New Delhi: The profits tax branch’s plans to arm itself with an SC order to enhance year-give up recoveries have hit a roadblock.

The authorities had approached appellate tribunals during the last few weeks, in search of to venture stay orders granted to assessees which are over six months vintage, based totally on an apex court docket judgment in March last yr that stay orders will not make bigger beyond six months, regardless of whether a case is civil or criminal.

However, in a ruling on March 15, the earnings tax appellate tribunal (ITAT) dismissed an appeal through the tax department searching for to vacate a stay granted to Piramal EnterprisesNSE -zero.25 % in a count number where the latter has disputed a call for making via the branch.


The ITAT cited in its judgment that the live orders have been granted to Piramal Enterprises as the case was still pending adjudication and that the put off became now not resulting from the enterprise, thereby clearing the grounds for grant of the life.

ET had pronounced in its version on March 11 that the earnings tax branch changed into preparing to use the Supreme Court order as a device to implement it needs towards assessees who have disputed those at the ITAT and were granted a stay past the six-month length.

“This judgment can be an alleviation to real taxpayers who have been granted life and anywhere the put off is not on account of the assessee the tribunal might be capable of furnish remains beyond twelve months,” stated Ronak Doshi, an associate at CA firm Bansi Mehta & Co.

According to senior chartered accountant Dilip Lakhani, “In February this year, the Bombay High Court in a writ petition did not uphold the IT dept’s stand, which changed into relying on the SC ruling.

Since ITAT is not a courtroom and court cases are not trial, the faint strive by the department to upset the judicial order to fulfill goal is likewise not justified”.

The tax branch argued that its grounds for requesting the life to be vacated have been based at the Supreme Court judgment in a case involving Asian Resurfacing of Road Agency and the Central Bureau of Investigation (CBI) in which the apex court docket ruled that live granting orders by way of courts would lapse after a duration of six months.

“The apex court’s judgment intends to make certain that human beings don’t use flimsy grounds for delaying payments by using getting live orders,” Transactions Square’s founder Girish Vanvari stated. “Even the apex court docket has noted in its judgment that during first rate instances a stay may be granted.”

In the case of Asian Resurfacing of Road Agency & others versus (CBI), which the I-T department is relying on, the apex courtroom on March 28, 2018, said: “Delay in trials affects the religion in the rule of regulation and efficacy of the prison system. It affects social welfare and development. Even in public or tax instances, it’s been laid down that energy to furnish stay has to be exercised with restraint… In instances wherein stay is granted in future, the same will end on the expiry of six months from the date of such order except a similar extension is granted by way of a speaking order. The talking order needs to show that the case was of such terrific nature”.

The tax departments desperation stems from a stiff target of Rs 12 lakh crore fixed within the period in-between finances. The total net collection as on March 7, 2019, changed into a little over Rs eight.45 lakh crore. The circulate to technique ITAT turned into advocated using PC Mody, chairman at Central Board of Direct Taxes, ET previously mentioned.

Appeals towards tax needs are generally made via an assessee on the workplace of the commissioner of IT appeals wherein it has to deposit 20% of the call for the amount on the time of acquiring a stay.

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