Tribunal extends stay on income tax demands for assessment years 2007-08 & 2008-09, emphasizes timely case disposal

The Tribunal granted an extension of stay for the balance income tax and interest demands for assessment years 2007-08 and 2008-09 pending before a Special Bench. The stay applications were allowed, and the stay on outstanding demands was extended until 180 days from the order date or until appeal disposal, whichever is earlier. The Tribunal emphasized the importance of timely disposal of cases referred to Special Benches and Third Members, setting guidelines for expeditious hearings and restricting adjournments for effective resolution of appeals.

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Issues:
Extension of stay granted by the Tribunal for balance income tax and interest demands for assessment years 2007-08 and 2008-09 pending before a Special Bench.

Analysis:
The stay applications sought extension for the outstanding payable amounts of income tax and interest for assessment years 2007-08 and 2008-09. The total demand for 2007-08 was Rs. 41,80,729, out of which Rs. 24,50,000 was paid, leaving a balance of Rs. 17,30,730. Similarly, for 2008-09, the total demand was Rs. 1,20,59,673, with Rs. 67,00,010 paid, and Rs. 53,59,663 outstanding. The assessee highlighted the delay in the hearing of appeals despite the constitution of a special bench almost two years ago. The counsel referred to Section 254(2A) of the Income Tax Act, emphasizing the legislature's intent for expeditious hearing of stay granted appeals within one year. The counsel urged for directions to ensure timely disposal and requested an extension of stay until the matter's hearing.

The Departmental Representative did not oppose the extension of stay and also sought earliest disposal of the appeals. The Tribunal noted the delay in fixing the hearing of the special bench case and emphasized the importance of timely disposal of such cases. Guidelines were formulated for expeditious hearing of cases referred to Special Benches and Third Members, emphasizing commencement of hearing within 120 days of constitution. Adjournments were restricted, and cooperation of all stakeholders was deemed necessary for timely disposal. The Tribunal scheduled the hearing of related appeals for 13th February 2019 with the consent of parties, extending the stay on outstanding demands until 180 days from the order date or until appeal disposal, whichever is earlier.

In conclusion, the stay applications were allowed, and the stay on outstanding demands was extended. The Tribunal highlighted the need for expeditious disposal of cases referred to Special Benches and Third Members, emphasizing timely hearings and cooperation for effective resolution of appeals.

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