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| DATE: | January 17, 2013 (Date of publication) |
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| Click here to download the judgement (vodafone_tribunal_stay_demand_unlimited.pdf) |
S. 254(2A) Third Proviso: Tribunal has the power to grant unlimited stay of demand
The assessee’s appeal was not disposed of by the Tribunal as a similar issue was pending in the case of another assessee before the Supreme Court. The Tribunal had granted a stay on recovery of the demand. On the expiry of 365 days, the assessee filed an application seeking extension of the stay for a further period. The assessee relied on Ronuk Industries 333 ITR 99 (Bom), Tata Communications Ltd 138 TTJ 257 (Mum)(SB) and Qualcomm Incorporated (ITAT Del) where it had been held that despite the Third Proviso to s. 254(2A), the Tribunal had the power to grant stay of demand beyond 365 days if the assessee was not at fault. The Department opposed the application by relying on Ecom Gill Coffee Trading (K’Taka HC) where a contrary view was taken and on Dunlop India Ltd 154 ITR 172 (SC). HELD by the Tribunal allowing the stay application:
The assessee is seeking extension of stay beyond 365 days. The assessee argued that on similar facts the matter is pending before the Supreme Court in case of Idea Cellular Ltd and Bharti Cellular Ltd wherein ad interim order had been passed. In CIT vs. Ronuk Industries Ltd 333 ITR 99 (Bom) & Tata Communications Ltd 138 TTJ 257 (Mum) (SB) it has been held that the Tribunal has power to extend the period of stay beyond 365 days under the Third Proviso to s. 254(2A) even if the delay in disposing off the appeal is not attributable to the assessee as there may be several other reasons for not disposing of the appeal by the ITAT. In Qualcomm Incorporated (ITAT Del) it was held that as there was a cleavage of opinion between the Bombay High Court and the Karnataka High Court and there was no decision of the jurisdictional High Court on the issue, the view favourable to the assessee has to be adopted. Consequently, the stay has to be extended subject to certain conditions.
in my view unless the law is settled by the courts revenue should aceept the cardinal rule that till settling of issue interpretation favourable to assassee in tax matters
Right view of the tribunal. It is already laid down law by Supreme court, that the tribunals shall follow their own jurisdictional high courts orders.
Karnataka High court decision may be persuasive but not mandatory, please. Revenue fails.
i was discussing with an intellectual friend on financial economics. In the discussion emerged, that Income Tax Act 1961 talks about sections when so every year finance bill is a superseding of previous year finance bill. Any previous years finance bill lapses once new finance bill is introduced in parliament where new members sit not old members elected earlier, so it means when new finance bill is passed then automatically earlier year finance bill automatically lapses, else it infringes fundamental rights of citizens under part iii of constitution. there is some meat in this innovative thought.It means whenever new bill is passed it takes away some earlier dispensations, so it is perfect to say that previous year finance bill is lapsed when new finance bill comes up every year, after all in the term of five years the government changes its finance perceptions how come the government take advantage of last year finance bill in certain aspects. yes it needs a very detailed research. True under Article 14 one can move government intention in new finance bill is a malafide as that creates a lot of uncertainties every year is it not!
that way there is a lot of meaning when late Nani Palkiwala said income tax is inglorious levy! so he was indeed a great thinker advocate, as he was quite imaginative.
In Golaknath v Panjab case, in1967 then CJI k subba Rao when delivering majority judgement said crystal clear that SC will impose on itself voluntary Estoppel when he introduced doctrine of prospective ruling saying that First, Fourth and Seventeenth Amendment will be not be questioned by SC only those amendments it produced till 1967 that is the self imposed estoppel is it not and as a result when CJI Y K sABHARWAL struck down schedule ix in first amendment , in IE Coelho(dead) rep by Legal Rep v TN in 2007 january judgenent CJI allowed only those laws till 1967 were allowed to continue and nothing further after 1967.
Similarly it would be said if u/s 143(2) limitation imposed is a self imposed estoppel on revenue is it not? If so revenue cannot breach their self imposed estoppel is it not, ie no Notice can surface after say 6 months or 12 months from the date of returns filed date!
But revenue breaches its own self imposed estoppel and if Supreme court also Beaches its self imposed estoppel, AFTER DOCTRINE OF PROSPECTIVE RULING WHAT WILL HAPPEN TO GOVERNMENT IS THE QUESTION?