Tribunal grants stay on tax amounts for 2012-13 and 2013-14, directs Rs. 21 crores deposit.

The Tribunal granted stay petitions for outstanding tax amounts for AY 2012-13 and AY 2013-14, directing the assessee to deposit Rs. 21 crores to prevent enforcement of the remaining tax amount for 180 days or until appeal disposal. Compliance with payment schedule and procedural conditions was required, with the possibility of stay vacation for non-compliance. The Tribunal emphasized the temporary nature of the stay and the need for timely proceedings, without expressing an opinion on the case's merits.

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Issues:
Stay petitions for outstanding tax amounts for AY 2012-13 and AY 2013-14.

Analysis:
The assessee filed two stay petitions seeking relief for outstanding tax amounts for AY 2012-13 and AY 2013-14. The primary issue for AY 2012-13 was the addition made by the AO towards AMP adjustment and 40(a)(ia) of the Act. The assessee argued that the AMP issue was contrary to decisions by the Hon'ble Delhi High Court in various cases. It was contended that there was no international transaction as the expenditure was for promoting the assessee's brand and end product user. Additionally, the assessee claimed economic ownership of tangible assets created through AMP spending. Regarding the 40(a)(ia) addition, the assessee differentiated the case from a jurisdictional High Court judgment and sought benefit under the Finance Act's amendment. The assessee also invoked the DTAA between India and Malaysia to avoid discrimination. Various High Court judgments were cited in support.

The Revenue argued that the issues raised were factual and required detailed examination to determine if the assessee had a prima facie case for relief. The bench inquired about financial hardship and immediate danger from the AO, to which the assessee responded that there was no financial hardship or urgent recovery proceedings. The bench proposed a reasonable deposit by the assessee, which the assessee agreed to. The Tribunal emphasized the need for the assessee to establish a prima facie case, financial hardship, and balance of convenience to warrant interim stay.

After considering submissions, the bench directed the assessee to deposit Rs. 21 crores as a condition of stay, taking into account the total demand for both years and amounts already paid. The payment schedule was outlined, and compliance would prevent enforcement of the remaining tax amount for 180 days or until appeal disposal. The Tribunal set hearing dates and imposed conditions, including timely submission of documents and no undue adjournments. Violation would lead to vacation of the stay. The order was pronounced, granting the stay petitions to the specified extent.

In conclusion, the Tribunal granted the stay petitions subject to the assessee's compliance with the deposit conditions and procedural requirements, emphasizing the temporary nature of the stay and the need for timely proceedings without expressing any opinion on the case's merits.

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