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2015 (10) TMI 1708 - ITAT BANGALORE

2015 (10) TMI 1708 - ITAT BANGALORE - TMI - Stay of recovery proceedings - Demand including interest u/s .234A to 234D - Assessments passed u/s 153A read with sec.143(3) - Held that:- In the facts and circumstances of the case, when the claim was earlier allowed for the assessment year 2004-05 which has not been disturbed by the AO till date and further the assessees before us have already paid about 65% and 56% respectively of the total outstanding demand which includes the levy of interest u/s .....

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a regular assessment. Thus, the assessee has also made out a prima facie case on the point of levy of interest u/s 234D.

Accordingly, having considered the totality of the facts of the case, we are of the considered opinion that the assessees before us have made out a good arguable case on merits as well as for grant of stay of the balance outstanding demand when the assessees have already made the payment of more than 50% of the total outstanding demand. Hence, the balance outstandin .....

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tioners : Shri K.R.Pradeep, CA. For The Respondent : Shri Anurag Sahay, CIT(DR). ORDER Per VIJAY PAY RAO, JM : These are seven stay petition by two related assessees seeking stay of outstanding demand arising from the assessments passed u/s 153A read with sec.143(3) of the Income-tax Act,1961 [hereinafter referred to as the Act for short] for the assessment years 2005-06 to 2007-08 and 2010-11 to 2011-12 respectively. 2. We have heard the learned AR of the assessee as well as the ld. DR and cons .....

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ompleting the assessment u/s 153A, the said claim of the assessee was withdrawn by the AO and consequently there is a demand in question. He has further submitted that the total demand for the seven years comes to ₹ 253,88,64,501/- out of which the assessee has already paid a sum of ₹ 164,45,31,814/-. Thus, the assessee has already paid more than 65% of the total demand which includes interest u/s 234A to 234C. The learned AR of the assessee has pointed out that the total demand in t .....

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ase of Director of Incometax( International Taxation vs. Delta Air Lines Inc. reported in 358 ITR 367 and submitted that the Hon'ble High Court has held that interest u/s 234D is not chargeable consequent to re-assessment because sec.234D applies only to those cases where refund was granted u/s 143(1) and subsequent regular assessment is made u/s 143(3) of the Act. The learned AR of the assessee has also relied upon the decision of the Mumbai Benches of the Tribunal in the case of MISC Berha .....

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AO has given much emphasis on the point that the assessee applied for private bonded warehouse in the year 2006 and therefore, when the request of the assessee for private bonded warehouse was pending for consideration, assessee did not set up the EOU. The learned AR of the assessee has further pointed out that the assessee has claimed its own manufacturing facility as bonded warehouse and merely because the request of the assessee was pending cannot lead to the conclusion that the assessee did .....

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ore than 65% of the total outstanding demand and about 99% of the tax demand excluding interest levied u/ss. 234A to 234D then in view of the fact that the assessee has made out a prima facie case, the outstanding demand in question may be stayed till the disposal of the appeals of the assessee. He further submitted that since interest u/s 234D is not leviable in case of the assessee for the assessment years 2005-06 and 2006-07, therefore, if the said amount is excluded from the total demand, th .....

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st. Thus, the learned AR of the assessee has submitted that the assessee has already made payment of the substantive tax demanded by the AO arising from the denial of deduction u/s 10B. Since denial of claim u/s 10B is based on the change of opinion without any tangible material found during search and seizure proceedings, therefore, the assessee has made out a prima facie case for stay of the outstanding balance demand till the disposal of the appeal. 4. On the other hand, learned Departmental .....

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tal Representative has submitted that though the assessee has already paid part of the tax demand, assessee may be directed to make further payment upto 75% of the demand if the assessee is seeking stay against the balance outstanding demand. He vehemently objected to the stay prayed by the assessee. 5. Having considered the rival submissions as well as the relevant material on record, we note that the assessee has already paid about 65% of the total outstanding demand in the case of Shri Dinesh .....

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sment. Once the AO has allowed the claim of the assessee u/s 10B in scrutiny assessment and the said assessment has not been disturbed then, the assessee has made out a good prima facie case on merit. We further note that even the question of establishing 100% EOU is a highly debatable issue in the facts of the case of the assessee, because the AO has not given a finding that there was no unit in existence but the finding of the AO is based more on the fact that the assessee s request for privat .....

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4-05 which has not been disturbed by the AO till date and further the assessees before us have already paid about 65% and 56%respectively of the total outstanding demand which includes the levy of interest u/s 234A to 234D then the assessees have made out a prima facie good case for grant of stay against the balance outstanding demand. In the case of Shri Dinesh Kumar Singhi, the total demand includes levy of interest u/s 234D amounting to ₹ 26.44 crores for the assessment years 2005-06 an .....

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