2024 (7) TMI 1495 - HC - Income Tax

Court Upholds Tribunal's Authority to Extend Tax Demand Stay Beyond 365 Days, Dismissing Revenue Appeals.

The Bombay HC dismissed the Appellant-Revenue's appeals concerning the extension of stay of demand beyond 365 days in income tax matters. Relying on ... Tribunal extending stay of demand beyond 365 days in the light of the provisions of Section 254 (2A) - HELD THAT:- The appeals before Tribunal in which the impugned interim order was passed granting extension of the stay of demand have been adjudicated, and therefore, for such reason these appeals have become infructuous. Be that as it may, even otherwise the question of law which has fallen for consideration in the present Appeals filed by the Appellant-Revenue, is no more res integra in view of the decision of Pepsi Foods (P) Ltd. [2015 (5) TMI 655 - DELHI HIGH COURT] in which the Delhi High Court considered the validity of the provisions of the third proviso to Section 254 (2A) and the amendment incorporated to the said provision by Finance Act, 2008 (with effect from 1 August 2008), by the words “even if delay in disposing of appeal is not attributable to assessee” were added. The Delhi High Court, held that the proviso to be illegal and had struck down the impugned part of the third proviso to Section 254 (2A) of the Act, which did not permit extension of stay of the said order beyond 365 days, even if the assessee was not responsible for delaying the disposal of appeal. The decision of the Delhi High Court was confirmed by the Supreme Court in the case of Deputy Commissioner of Income Tax Vs. Pepsi Foods Ltd. [2021 (4) TMI 369 - SUPREME COURT]. Thus in view of the authoritative pronouncement (supra), no fault can be found in the impugned order passed by the Tribunal. These appeals would not give rise to the question of law, as sought to be raised on behalf of the Appellant-Revenue. We may observe that similar issue had arisen for consideration of this Court in Fulford (India) Ltd. [2024 (6) TMI 1029 - BOMBAY HIGH COURT] in which considering such position in law as held by the Delhi High Court and confirmed by the Supreme Court in the case of Pepsi Foods (P) Ltd. (supra), this Court had refused to entertain Appeals filed by the Appellant- Revenue, assailing the orders passed by the Tribunal. The High Court of Bombay dismissed the appeals filed by the Appellant-Revenue regarding the extension of stay of demand beyond 365 days in income tax cases. The court cited the decision of the Delhi High Court and the Supreme Court in Pepsi Foods (P) Ltd. case, confirming the legality of the extension granted by the Tribunal. The appeals were deemed infructuous as the matters had already been adjudicated.