TMI Blog2011 (2) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... can be expressed on merits favouring the either side of the dispute Out of the total demand of Rs 28.15 crores, only the demand of Rs 17.62 crores is the collectible demand and it includes Rs 10.83 crores of tax component, the assessee shall pay 50% of the sum of Rs 10.83 crores ie Rs 5.42 crores immediately either by way of adjustment of refunds or otherwise at the option of the assessee - In the result, the stay application is allowed pro-tanto - 08/PN/2011 - - - Dated:- 24-2-2011 - SHRI SHAILENDRA KUMAR YADAV, SHRI D. KARUNAKARA RAO, JJ. Applicant by : Dr. A.S. Singh Respondent by : Shri R.R. Vora ORDER Per D. Karunakara Rao AM This is the Stay Application filed by the assessee in connection with appeal ITA No. 18/PN/2011 for the A.Y. 2006-07. As per the application, assessee is in arrears of the demand to the tune of 28.15 Crores (rounded off). It includes tax component of Rs. 17.03 Crores and rest of it relates to the interest component. As per the stay application, the assessee filed separate application for stay of demand before the DCIT on 28.12.2010, before Additional CIT on 17.1.2011 and finally before the CIT on 17.1.2011. None of these o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the disallowance of provision for expenses. Concluding from the above, as per assessee, Rs. 10.83 Crores is the tax component which is open for recovery notwithstanding the disputes attached with it as made out in the present appeal. Further, the interest levied under section 234 B C in respect of the demand of Rs 10.83 crores is Rs. 6.79 Crores. Finally, the total demand which can be reasonably open for collection is Rs. 17.62 Crores as per the summary chart filed before us (Rs.10.83 + Rs. 6.79 Crores). 3. During the proceedings, in the context of filing of the present SA before us without awaiting the decision of the revenue, an issue of maintainability of the such SA came up. In this regard, Ld Counsel demonstrated the necessity of such an application at this point of time and mentioned the inaction of the revenue for nearly two months considering the 28th December 2010 the date of filing of the application before the AO. Ld Counsel also demonstrated the way similar issue came up before the this and other benches of the Tribunal and upheld the maintainability of the Stay application, which were filed before the Tribunal. In this regard, Shri Vora, the Ld Counsel for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.3 Crores is refund pending with the Department for the issue and the same has not been issued till date. On enquiry from the bench on the readiness of the assessee to pay any of arrears, the Ld. Counsel mentioned that the Bench may consider giving directions to the A.O. to adjust the said refunds towards the arrears to the extent of Rs. 5 Crores and rest of the refunds may be withheld by them till the disposal of the appeal by the Tribunal. Ld counsel requested for grant of early hearing. Further, Ld AR brought our notice the cases approved by the DRPs, where similar stay application were disposed off by various benches of the Tribunal of Delhi Bench either granting complete stay of demand in some cases and granting stay of demand subjected to payment of 10 % of the demand. 5. On the other hand, the Ld. D.R for Revenue argued stating that the assessee has to pay the whole of the arrears immediately. Ld DR took objection to the way the assessee filed of the present Stay Application before the Tribunal ie prior to the date of filing of the stay applications before the Addl. CIT and CIT. On the issue of collectible undisputed demand, DR demonstrated the existence of Rs. 17.62 Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not necessary that assessee should necessarily approach the Commissioner of Income Tax before approaching the Tribunal for grant of stay. Similar view has been expressed by the Tribunal at Delhi in the case of Reutes India (P) Ltd. 3 SOT 886 [Del]. Hence the objection of the revenue is rejected and the point is answered in favour of the assessee. 6. Income tax Act has conferred certain powers on the Income tax Authorities for discharging and one such power relates the matters of stay of the demand. Assessee filed the stay application before the AO on 28th December 2010 and the AO did not take any action, be it a case of rejection or otherwise. Same is the fate of the application lying with the Addl CIT. CIT merely passed on the responsibility to his deputies vide the letter dated 18.1.2011 instead of either staying the demand or rejecting the request for stay of the same or otherwise. While there is inaction with the Revenue on the applications for stay, the assessee is busy in making application for stay of demand from time to time fearing of ultimate coercive action by the AO and its likely adverse effects on the business operations of the assessee. Therefore, the Calcutta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make any difference whether the assessee filed any application before the Revenue and not awaited their decisions before filing application before the Tribunal or directly approaching the Tribunal without even filing the applications before the Revenue authorities, when there exists threat of coercive action by the AO. Thus, therefore, the objections raised by the Revenue in this regard are dismissed. 8. Coming to the merit of the additions, we find that the demand raised by the Revenue is certainly in higher side considering the invoking of the transfer pricing provisions to the Non-AE transactions. It is the law of the land that Transfer Pricing provisions apply to the AE transactions. Therefore, the demand relatable to the non-AE transactions amounting to Rs. 9.98 Crores as highlighted by assessee may not be a collectible demand. In any case, as per the summary chart prepared by the assessee, Rs. 17.62 Crores is not a high-pitched demand and hence it is collectible demand and the tax component of the same is determined at Rs 10.83 Crores. 9. Further, we have examined the general issues to be considered for deciding the stay applications. It is the operating guidelines in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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