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2023 (3) TMI 188 - ITAT MUMBAIStay of demand - Tribunal's powers of granting the stay - payment of 20% of the disputed demands - HELD THAT:- An institution like this Tribunal, which is itself a creature of the Income Tax Act, 1961, has to perform its functions within the limitations that the Income Tax Act, 1961, has imposed on its functioning. As we say so, we make it clear that the law itself visualises that the payment of 20% of the disputed demands, impugned in the appeal before the Tribunal, cannot be viewed as a condition precedent for the grant of stay by the Tribunal, inasmuch as when the applicant “furnishes security of equal amount in respect thereof”, the Tribunal can exercise its powers of granting a stay. While the issue of the reasonableness of the nature of security cannot be at the unfettered discretion of the Assessing Officer, and it must meet the judicial scrutiny as and when so required. It has to be ensured that the limitations placed upon the powers of the Tribunal are respected, in letter and in spirit, and, on the other hand, it has to be equally ensured that, within this framework, substantial justice is to be rendered to the assessee and the rights of the assessee even to seek the legal remedies against any inappropriate use of power by the field authorities are zealously guarded. What constitutes reasonable security may vary from case to case. That is where a judicious and pragmatic approach by the field authorities is of utmost importance. Still, where their decisions, on this aspect, are less than appropriate, the Tribunal can surely judicially examine the same, or even decide, on its own, as to what is the nature of security to be offered by the assessee. In the present case, for the reasons we will set out in a short while, there is no need for us, as of now, to take a call on the nature of security to be offered by the assessee, even as the ususal precautions to safeguard legitimate rights of the assessee are being taken anyway. Learned counsel hastens to add, at the fag end of the proceedings, that since almost all the issues are covered by the binding judicial precedents in favour of the assessee, a conditional stay may be granted by directing the Assessing Officer to grant a stay on collection/recovery of the demands impugned in appeal before us, after accepting security equivalent to 20% of the disputed demands and to his satisfaction, on the same lines as was ordered by a coordinate bench in the case of Grasim India Ltd [2021 (4) TMI 495 - ITAT MUMBAI] That is a case in which the stay was granted on the condition that the assessee was to provide, to the satisfaction of the Assessing Officer, security for the amount of 20% of the disputed demands impugned in the appeal. Having heard the learned Departmental Representative on this plea and having satisfied ourselves that the issues in appeal are by and large covered by the judicial precedents- including in the assessee‟s own case, we are inclined to accord the same treatment, and, consequently, grant a stay on collection/recovery of the disputed impugned demands, and interest thereon. The assessee shall provide a reasonable security for an amount of Rs. 35 crores or more, within two weeks from the date of receipt of this order; Provided, however, in case the Assessing Officer is, for any reasons whatsoever, not satisfied with the security offered by the assessee, the Assessing Officer shall pass a detailed speaking order in respect of the same and setting out his position on the issue, and will give a two week notice to the assessee, before initiating any coercive recovery proceedings, so that the assessee can pursue appropriate legal remedies, if so advised, against the stand of the Assessing Officer. The assessee will fully cooperate in expeditious disposal of appeal before this Tribunal and will not seek any unnecessary adjournment.
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