Tribunal Extends Stay on Tax Demand, Allows Refund Adjustment The Tribunal granted an extension of stay for an outstanding demand for Assessment Year 2011-12, amounting to &8377; 60,94,46,150, with the assessee ...
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Tribunal Extends Stay on Tax Demand, Allows Refund Adjustment
The Tribunal granted an extension of stay for an outstanding demand for Assessment Year 2011-12, amounting to &8377; 60,94,46,150, with the assessee having already deposited &8377; 31,19,91,745. The stay was extended for three months or until the Tribunal's order in the appeal, following legal precedent allowing extensions beyond the 365-day limit under Section 254(2A) of the Income Tax Act, 1961. The Tribunal directed that a refund of &8377; 7,59,94,310 for Assessment Year 2010-11 be retained or adjusted against the outstanding demand during the stay period.
Issues: Extension of stay granted by Tribunal for outstanding demand for Assessment Year 2011-12.
Analysis: The judgment deals with an application seeking an extension of stay granted by the Tribunal regarding an outstanding demand for Assessment Year 2011-12. The demand amount was &8377; 60,94,46,150, out of which the assessee had already deposited &8377; 31,19,91,745. The Assessing Officer explained that recovery was pending due to the non-disposal of the corresponding appeal by the Tribunal. Additionally, a refund of &8377; 7,59,94,310 pertaining to Assessment Year 2010-11 had been determined payable to the assessee but not yet granted. The Tribunal decided to continue the stay on the recovery of the remaining demand for a further three months or until the Tribunal's order in the assessee's appeal, whichever is earlier. The Tribunal also directed that the refund determined payable to the assessee be retained or adjusted against the outstanding demand during the period of stay.
The Department raised a concern that the continuation of the stay would exceed the period specified under Section 254(2A) of the Income Tax Act, 1961, which is 365 days. However, the Tribunal referred to a judgment of the Hon'ble Bombay High Court in the case of CIT vs. Tata Teleservices (Maharashtra) Ltd., which upheld the Tribunal's power to extend the period of stay beyond 365 days if circumstances warrant such an extension. Therefore, considering the circumstances of the case and the legal precedent, the Tribunal extended the stay as deemed appropriate. The stay application was disposed of based on these considerations.
The judgment was pronounced in the open court in the presence of both parties at the conclusion of the hearing on 3rd January 2019.
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