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2016 (5) TMI 47 - ITAT DELHI

2016 (5) TMI 47 - ITAT DELHI - TMI - Extension of stay of outstanding demand - Held that:- In the facts of the present case, stay for 365 days has already been granted by the ITAT and a further stay of six months beyond the said period is requested by the assessee. In order to decide the issue arising in the present stay petition, the specific provision invoked by the assessee and required to be considered by us in the present proceedings is section 254(2A).

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or The Appellant : Sh.Gaurav Bhutani and Yishu Goel, CA For The Respondent : Ms. Anima Barnwal, Sr.DR ORDER PER DIVA SINGH, JM By the present stay petition in ITA No.764/Del/2015, the assessee prays for extension of stay of outstanding demand of ₹ 4,07,87,088/-. 2. Referring to material available on record it was submitted by the Ld.AR that originally stay for a period of 6 months was granted by the ITAT vide order dated 05/03/2015 in S.A No.-141/Del/2015. In terms of the direction therein .....

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een decided for no fault of the assessee. Inviting attention to Annexure-8 to the stay petition filed it was submitted that on each of the dates when the appeal came up for hearing it was adjourned on the request of the Department. Accordingly it was his prayer that the stay may be extended for a period of six months as whether the Revenue would be ready to argue on the next date or not could not be ascertained. 3. The Revenue represented by Ms. Anima Barnwal, Sr. Dr submitted that since the app .....

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she was not in a position to state whether on 23.03.2016 the Department would be ready to argue the appeal or not. 4. We have heard the rival submissions and perused the material available on record. In the facts of the present case, stay for 365 days has already been granted by the ITAT and a further stay of six months beyond the said period is requested by the assessee. In order to decide the issue arising in the present stay petition, the specific provision invoked by the assessee and requir .....

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is filed under subsection (1) or sub-section 253: Provided that the Appellate Tribunal may, after considering the merits of the application made by the assessee, pass an order of stay in any proceedings relating to an appeal filed under sub-section (1) of section 253, for a period not exceeding one hundred and eighty days from the date of such order and the Appellate Tribunal shall dispose of the appeal within the said period of stay specified in that order : Provided further that where such app .....

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t, in any case, exceed three hundred and sixty-five days and the Appellate Tribunal shall dispose of the appeal within the period or periods of stay so extended or allowed: Provided also that if such appeal is not so disposed of within the period allowed under the first proviso or the period or periods extended or allowed under the second proviso, which shall not, if any case, exceed three hundred and sixty-five days, the order of stay shall stand vacated after the expiry of such period or perio .....

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another six months. The third proviso which curtailed the powers of the ITAT to grant stay beyond a period of 365 days came up for consideration before the Jurisdictional High Court in Pepsi Foods Pvt.Ltd.(cited supra). The Jurisdictional High Court considering the decision rendered in the case of Maruti Suzuki India [2014] 44 taxman.com.166 (Del.) held that the Division Bench of the High Court in Maruti Suzuki s case was not called upon to examine the Constitutional validity of the third provis .....

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who delayed the hearing after having obtained the stay. Considering the Amendment carried out by the Finance Act 2008 as violating the non-discrimination clause of Article 14 of the Constitution of India the third proviso was struck down and the second proviso to section 254(2A) was read down. For ready-reference, para 24 of the decision is reproduced hereunder:- 24. Furthermore, the petitioners are correct in their submission that unequals have been treated equally. Assessees who, after having .....

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the appeal is not attributable to the assessee'- by virtue of the Finance Act, 2008, violates the non-discrimination clause of Article 14 of the Constitution of India. The object that appeals should be heard expeditiously and that assessees should not misuse the stay orders granted in their favour by adopting delaying tactics is not at all achieved by the provision as it stands. On the contrary, the clubbing together of 'well behaved' assessees and those who cause delay in the appeal .....

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al is not attributable to the assessee, the Tribunal has the power to grant extension of stay beyond 365 days in deserving cases. The writ petitions are allowed as above. (emphasis provided) 4.2. Thus on considering the judicial precedent, we find that there is no legal impediment to the Tribunal to extend stay for a period beyond 365 days in deserving cases. Considering the facts of the present case, we find that after the order dated 15.09.2015 in S.A.No.457/Del/2015 the ITA No.764/Del/2015 ca .....

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the aforesaid peculiar facts and circumstances of the case, we find that the adjournment granted and delay in disposal of the appeal cannot be said to be attributable to the assessee. Accordingly finding ourselves satisfied with the conduct of the assessee who is found to have remained present on each of the dates when the appeal came up for hearing we hold that the present case is a fit case for extension of stay for a period of six months or disposal of appeal whichever is earlier. Support is .....

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iment to the Tribunal to extend stay for a period beyond 365 days in deserving cases. Reliance may also be placed on order dated 01.02.2016 in SA No.-18/Del/2016 in ITA No.414/Del/2015 in the case M/s Jaypee Infratech Ltd.vs ACIT. In the said background reverting to the facts of the present case we find that though on a bare reading of the recordings made in the order sheet by the Co-ordinate Bench on different dates it is borne out that the adjournments have been moved by the Ld.AR however, whe .....

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obtained the stay. We find that more or less factually similar position was considered by the Hon ble Punjab & Haryana High Court in PML Industries Ltd. vs CCE [2013] 22 GSTR 83 (P&H) which was relied upon by the petitioners before the Hon ble Delhi High Court in Pepsi Foods Pvt.Ltd. (cited supra) in para 20. The same is extracted hereunder:- 20. The learned counsel for the petitioners had also referred to a decision of the Division Bench of the Punjab and Haryana High Court in PML Indu .....

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the Tribunal, in appropriate circumstances, could extend the period of stay beyond 180 days. While considering the said question, the Punjab and Haryana High Court held as under (page 117 of 22 GSTR) : "Though the right of appeal is a creation of Statute and it can be exercised only subject to the conditions specified therein, but the conditions specified have to be in relation to the assessee as some thing which is required to be complied with by the assessee. But where the assessee has no .....

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structure ; the members of the Tribunal and the workload. Therefore, for the reason that the Tribunal is not able to decide appeal within 180 days, the vacation of stay is a harsh and onerous and unreasonable condition. The condition of vacation of stay for the inability of the Tribunal to decide the appeal is burdening the assessee for no fault of his. Such a condition is onerous and renders the right of appeal as illusory. An order passed by a judicial forum is sought to be annulled for no fau .....

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egality rendering the right of appeal as redundant . . . Consequently, the second proviso in sub-section (2A) of section 35C is ordered to be read down to mean that after 180 days, the Revenue has a right to seek vacation of stay on proof of the fact that the assessee is the one, who is defaulted or taken steps to delay the ultimate decision." The said court read down the provision in question in much the same manner as did the Bombay High Court in the case of Narang Overseas (supra). The o .....

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