TaxTMI 
TaxTMI 
2011 (2) TMI 302
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....assessee is aggrieved with the high pitched assessment i.e. assessed income is Rs. 75 Crores (rounded) against returned income of Rs. 20.7 Crores. Further, the assessee is aggrieved the way the deduction claimed u/s. 10A(7) was denied. Further also, the assessee is aggrieved with the way the Transfer Pricing guidelines or laws were applied to the assessee's case. Finally, assessee narrated the hardship in matters of paying the impugned arrears of demand and placed reliance on the written text as seen from para 6.3 of the annexure. The assessee also prayed for stay of demand till the appeal is decided by the Tribunal. The prayer of the assessee in brief as given in para no. 8 is as under : "8. The Applicant, therefore, prays: a) That the recovery proceedings should not be initiated against the Applicant till the receipt of the order of the ITAT with regard to the appeal filed against the order of the learned AO under section 143(3) read with section 144C(13) of the Act and for a period of 30 days thereafter; b) That the learned AO, the Tax Recovery Officer, the Commissioner of Income-tax or their subordinates or their successors may be restrained from t....
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....IT (TDS), Stay Application Nos. 224 to 226/Mum2009,A.Ys. 2007-09, 2008-09 & 2009-2010 (Mum) 3) Taneja Deverlopers & Infrastructure Ltd. vs. ACIT & Ors. (2009), Writ Petn. No. 6956 of 2009 & CM No. 2320 of 2009, 222 CTR (Del) 521 4) Reuters India (P) Ltd. vs. DCIT, ITAT, Delhi 'D" Bench, Stay Petition No. 157/Del 2004 in ITA No. 1089/DEL?2004 The above decision were cited to indicate that the Tribunal has power to stay the demand in cases of high pitched assessments, the Tribunal has a jurisdiction in respect of the stay applications even if assessee did not file stay application before the revenue authorities (para 8 & 9 of the order in the case of Vodafone Essar Limited dated 11.12.2009 is relevant). 4. Further, Ld. Counsel fairly mentioned that there is no judgment of any High Court on this issue of maintainability of the directly filed stay application before the Tribunal. Further, he mentioned that there exists decision of the Tribunal of Pune Bench in favour of the assessee's contention that Tribunal has jurisdiction in such matters and filed copy of our decision in the case of M/s. Kumar Company, S.A. Nos. 44 to 46/PN/2009, order dated ....
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.... i.e. Rs.11.32 Crores minus Rs. 7.6 Crores. DR underlined the need for payment of the arrears. 5. We have heard the parties and perused the orders of the Revenue on the Stay Application with its Annexures. We have also gone through various citations relied upon by the assessee's Counsel in support of the said arguments that the Tribunal has jurisdiction in respect of the Direct Stay Applications (DSA) before the Tribunal (those stay applications without going to the Revenue authorities or without waiting for the decision of the Revenue authorities). On the issue of maintainability of the DSAs, we find that it is a settled issue at the level of Tribunals that the DSAs are maintainable as held by various Benches of the Tribunal viz. Pune (M/s. Kumar and Company & Starent Networks I. Pvt. Ltd.), Delhi (Reuters India (P) Ltd., Mumbai and Vodafone Essar Limited & M/s. KEC International Limited). In our opinion, these are the cases, were the assessee never filed a stay application before the AO or any other IT authorities. For the sake of completeness of the order, we reproduce para 8 and 9 of the decision of the Tribunal in the case of Vodafone Essar Limited dated 11.12.2009 a....
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....re in favour of the assessee for the proposition that the 'it is not necessary that assessee should necessarily approach the Commissioner of Income Tax before approaching the Tribunal for grant of stay' Nagarjuna Fertilisers & Chemicals Ltd [supra].Further, we have also perused the understanding between the BAR and the Tribunal in matters of demands covered by the DRP's decisions and not insisting of the rejection of stay applications filed before the CIT. Relevant issue 10 is reproduced as follows. "10. The Dispute Resolution Panel constituted under the Income tax Act comprises of officers of the rank of Commissioners of Income Tax. The orders passed by them are directly appealable before the Honourable Tribunal. Very often when the applications for stay are made before the Honourable Tribunal, it is insisted that the rejection of stay application by the Commissioner of Income Tax be obtained before the petition for stay is to be proceeded with by the Tribunal. Since after the passage of orders by the DRP, Commissioners are functus officio as far as stay of demand is concerned very often they go ahead with the recovery of tax even while the stay applications are pending ....
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....: (i) liquidity of the funds of the assessee to clear the tax arrears out of own funds at the relevant point of time based on the assessee's financial status at the time of the stay petition hearing; (ii) creditworthiness of the assessee to outsource the funds to clear the departmental dues; (iii) prima facie views on the likely decision of the Tribunal on the issues raised in the appeal; (iv) departmental urgencies in matters of collection and recovery; (v) guarantees provided by the assessee to safe guard the interest of the revenue etc. 10. In the light of the above facts of the case as well as the philosophy relating to the matters on granting of the stay, we find the assessee's refund amounts to the tune of more than Rs 11 crore is still with the department and it is undisputed. In so far as the merits of the issue are concerned, the issue in question revolves around 'transfer pricing' issues and without hearing the parties in dispute, no prima facie view can be expressed on merits favouring the either side of the dispute. The arguments raised by the Ld. Counsel cannot be brushed aside summarily as the said arguments are backed by the extensive citations of several o....