TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 141
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....No. 3758-S of 2001 dated 12.10.2001. The petitioner was granted registration under section 12A(1)(ac)(i) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') on 12.10.2021. The said registration came to be cancelled by the Commissioner of Income-tax (Exemptions), Chandigarh, vide order dated 19.01.2024, purportedly in exercise of powers under section 12AB(4)(ii) of the Act. 2. Aggrieved by the order of cancellation, the petitioner preferred an appeal before the Income-tax Appellate Tribunal, Amritsar Bench, registered as I.T.A. No. 56/Asr/2025. A stay application being SA No. 3/Asr/2025 was filed along with the appeal, seeking, inter alia, stay of the operation of the cancellation order during pendency of the appeal. 3. ....
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....en in the absence of an express statutory provision, an appellate authority possesses the power to stay proceedings pending appeal, such power being incidental or ancillary to the effective exercise of its appellate jurisdiction. The Court observed as under: "We think that the petitioner is entitled to succeed on the first ground, and that it is unnecessary to consider the validity of the second ground. That the power to stay is a necessary corollary and is incidental to the appellate power has been ruled by Rajagopala Ayyangar J., as a judge of the Madras High Court, in Swarnambikai Motor Service v. Wahita Motor Service W. Ps. Nos. 427 and 438 of 1956. The short report of the case sets out the relevant passage as follows: "It is n....
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....revent the appeal if successful from being rendered nugatory." 9. In "Commissioner of Income-tax v. Income-tax Appellate Tribunal", WP(C) No. 4684/2010, decided on 03.08.2012, the Delhi High Court reaffirmed the position of law regarding the powers of the Tribunal and held as under: "21. So far as the order of the Tribunal passed on 21.05.2010 is concerned, it is well settled by the judgment of the Supreme court in ITO v. M.K. Mohammed Kunhi [1969] 71 ITR 815 that the Tribunal, while exercising its appellate powers under the Income Tax Act has also the power to ensure that the fruits of success are not rendered futile or nugatory and for this purpose it is empowered, to pass appropriate orders including orders of stay. ....
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....will be no order as to costs." 10. In "Assistant Commissioner of Income-tax v. GE India Industrial (P.) Ltd.", Special Civil Application No. 6851 of 2013, the Gujarat High Court reiterated that the Income-tax Appellate Tribunal, in exercise of its powers under section 254 of the Income-tax Act, possesses incidental and ancillary powers to pass such interim orders as may be necessary to protect the efficacy of the appellate remedy. The Court held that the Tribunal is competent to grant stay where continuation thereof during pendency of the appeal would render the appeal nugatory. It was further observed that while exercising such power, the Tribunal must be satisfied that a strong prima facie case is made out and that refusal to grant int....
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.... as incidental or ancillary to its appellate jurisdiction. However, while exercising such power of stay, the Tribunal has to be satisfied that there is a strong prima facie case made out and the Tribunal is satisfied that the entire purpose of appeal would be frustrated or rendered nugatory by allowing the recovery proceedings/penalty proceedings to continue, during pendency of the appeal. It is also observed that in a case where the Appellate Tribunal grants the stay either of recovery and/or stay of penalty proceedings, the Appellate Tribunal shall see to it that the appeal before it is decided and disposed of finally at the earliest and preferably within a period of three months so that the appellant-assessee may not take undue advantage....