Tribunal Halts Recovery Proceedings Pending Appeal, Orders Suspension of Coercive Measures

The Tribunal granted an interim stay on recovery proceedings until the disposal of the appeal, directing revenue authorities to suspend coercive measures and garnishee proceedings. The Tribunal emphasized the need to await the outcome of the stay petition before taking any further actions to recover outstanding demands. It suspended garnishee proceedings and ordered the suspension of all coercive measures until further instructions, emphasizing communication of the order to field authorities and parties promptly.

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Issues:
Extension of stay on recovery proceedings, Coercive measures by revenue authorities, Suspension of garnishee proceedings, Interim stay on proceedings.

Extension of Stay on Recovery Proceedings:
The applicant sought an extension of the stay granted by the 'C' Bench against recovery proceedings initiated by the department until the disposal of the appeal in ITA No. 7302/Mum/2018. The applicant filed an application for extension of stay as the 180-day period had expired, and the appeal was still pending. The department resorted to coercive means for recovery, including a recovery survey, issuing summons, and attaching bank accounts, despite the pending application for extension of stay. The applicant requested an extension of stay under the second proviso to Section 254(2A) until the final order is pronounced. The Tribunal granted an interim stay on proceedings until the disposal of the stay petition, the appeal, or further orders, whichever is earlier. The Tribunal directed the revenue authorities to suspend all coercive measures and garnishee proceedings until the stay petition is disposed of.

Coercive Measures by Revenue Authorities:
The revenue authorities resorted to coercive measures for recovering the demand, such as conducting a recovery survey, issuing summons, and attaching bank accounts, despite the pending application for extension of stay. The Tribunal noted the inappropriate haste in initiating garnishee proceedings on the bankers of the assessee on the same day the hearing of the stay petition concluded. The Tribunal emphasized that the revenue authorities should have waited for the disposal of the stay petition before taking coercive actions. The Tribunal directed the revenue authorities not to resort to or continue with any coercive measures to recover the outstanding demands until further orders.

Suspension of Garnishee Proceedings:
The Tribunal suspended the garnishee proceedings initiated by the revenue authorities on the bankers of the assessee until the stay petition is disposed of. The Tribunal deemed it appropriate to grant an interim stay on the proceedings until a specified date, the disposal of the stay petition, the appeal, or further orders, whichever is earlier. The Tribunal ordered the suspension of all garnishee notices issued by the revenue authorities on or after a specific date until further instructions.

Interim Stay on Proceedings:
The Tribunal granted an interim stay on the proceedings until the disposal of the stay petition, the appeal, or further orders. The Tribunal emphasized the need to suspend all coercive measures and garnishee proceedings until the stay petition is resolved. The Tribunal directed the revenue authorities to communicate the order to the field authorities immediately and provide a copy of the order to the parties by hand. The interim order was pronounced with limited validity on a specific date.

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