At, Income Tax Appellate Tribunal Bangalore
By, THE HONOURABLE MR. N.V. VASUDEVAN
By, JUDICIAL MEMBER & THE HONOURABLE MR. A.K. GARODIA
By, ACCOUNTANT MEMBER
For the Applicant: Narendra Sharma, Advocate. For the Respondent: Siddappaji, Addl. CIT(DR)(ITAT)
N.V. Vasudevan, Judicial Member:
1. This is an application filed by the assessee praying for an order extending the order of stay of recovery of outstanding demand of Rs.8,30,92,838 for a period of six months from 04.09.2018 or till the disposal of the appeal.
2. It has been stated in this application that the appeals were posted for hearing before the Circuit Bench of the Tribunal at Mangalore on 02.02.2017 and the case was heard and reserved for orders. Later the appeal so heard and reserved for orders was released and listed to be posted for fresh hearing. Since the department had attached all the rentals receivable and the assessee had no funds to pay the outstanding demand, therefore a stay petition was filed before the Tribunal and the Tribunal vide its order dated 01.09.2017 in SP No.147/Bang/2017 granted stay against recovery of the outstanding demand for a period of three months. Thereafter the appeal was heard on 08.11.2017 and reserved for orders. The stay expired on 30.11.2017, upon which the department issued garnishee notices u/s. 226(3) of the Income-Tax Act, 1961 ["the Act"] to the banks/tenants. Thereafter, another stay petition was filed before the Tribunal in SP No.66/Bang/2018 and the Tribunal vide its order dated 09.03.2018 granted stay for a period of 180 days which expires on 04.09.2018. The ld. counsel for the assessee submitted that the AO vide letter dated 08.08.2018 has intimated about initiation of recovery proceedings against the assessee on expiry of the stay on 04.09.2018 and hence the present stay petition.
3. It was further submitted that the assessee has paid more than 50% of the disputed taxes and it is hard pressed for funds to pay the outstanding demand. On merits, it is submitted that the assessee is confident of succeeding in its appeal before the Tribunal. The non-disposal of the appeal before the Tribunal is not attributable to the assessee. Therefore, it is prayed for an order of extension of stay.
4. We have heard the rival submissions. From the facts narrated above, it is clear that the delay in non-disposal of the appeal is not attributable to the assessee. The law is by now well settled that if the delay in non-disposal of the appeal is not attributable to the assessee, then the Tribunal has power to extend the period of stay beyond the time limit laid down in third proviso to section 254(2A) of the Act. Reference may be made to the decision of the Hon'ble Delhi High Court in the case of Pepsi Foods (P) Ltd. v. ACIT, 376 ITR 87 (Del) which was followed by the ITAT Bangalore Bench in the case of M/s. SAP La
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bs (I) Pvt. Ltd. v. ACIT, 67 taxmann.com 78. We therefore extend the order of stay of recovery of outstanding demand for a period of six months from the date of this order, or till the disposal of the appeal, whichever is earlier. 5. In the result, the stay petition is allowed.