May 2012
Section 253 of the Income-tax Act, 1961 — Direct stay application filed before Tribunal is maintainable and it is not a requirement of law that assessee should necessarily approach Commissioner before approaching Tribunal for grant of stay.
By C. N. Vaze
Shailesh Kamdar
Jagdish T. Punjabi
Bhadresh Doshi
Chartered Accountants
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(2012) 49 SOT 333 (Pune)
Honeywell Automation India Ltd. v. Dy. CIT
A.Y.: 2006-07. Dated: 24-2-2011
Section 253 of the Income-tax Act, 1961 — Direct stay application filed before Tribunal is maintainable and it is not a requirement of law that assessee should necessarily approach Commissioner before approaching Tribunal for grant of stay.
The assessee filed separate application for stay of demand before the Deputy Commissioner, before Additional Commissioner and finally before the Commissioner. None of these officials disposed of the assessee’s applications for stay of demand. The assessee-company thereupon filed application before the Tribunal for stay against the demand of arrears by the Revenue. The Revenue raised an objection that Tribunal had no jurisdiction to entertain directly stay application (DSA) without waiting for decision of the lower authorities.
The Tribunal dismissed the objections raised by the Revenue. The Tribunal noted as under:
(1) The Act has conferred certain powers on the Income Tax authorities for discharging and 158 (2012) 44-A BCAJ 9 10 one such power relates to matters of stay of the demand. The assessee filed the stay application before the Assessing Officer, but the Assessing Officer did not take any action, be it a case of rejection or otherwise. The same is the fate of application lying with the Additional Commissioner. The Commissioner merely passed on the responsibility to his deputies instead of either staying the demand or rejecting the request for stay of the same or otherwise.
(2) While there is inaction on part of the Revenue on the applications for stay, the assessee is busy in making application for stay of demand from time to time fearing ultimate coercive action by the AO and its likely adverse effects on the business operations of the assessee.
(3) Regarding the DSA by the assessee before the Tribunal, the decisions of the Tribunal are in favour of the assessee for the proposition that it is not necessary that the assessee should necessarily approach the Commissioner of Income-tax before approaching the Tribunal for grant of stay.
(4) Therefore, DSA filed before the Tribunal is maintainable and it is not the requirement of law that the assessee should necessarily approach the Commissioner before approaching the Tribunal for grant of stay.
(5) It does not make any difference whether the assessee filed any application before the Revenue and not awaited their decisions before filing application before the Tribunal or directly approached the Tribunal without even filing the applications before the Revenue authorities when there exists threat of coercive action by the Assessing Officer.
