‘Congress’ Can File Fresh Stay Application Before ITAT as 48% of Outstanding Demand Has Been Recovered | HC

Case Details: Indian National Congress v. DCIT - [2024] 160 taxmann.com 359 (Delhi)

Judiciary and Counsel Details

• • Yashwant Varma & Purushaindra Kumar Kaurav, JJ.
  • Vivek K. Tankha, Ravi Shankar Jandhyala, Prasanna S., Vipul Tiwari, Inderdev Singh, Ms Kanishka Singh, Nikhil Bhalla & Ms Tarannu Cheema, Advs. for the Petitioner.
  • Zoheb Hossain, Vipul Agrawal, Sanjeev Menon, Ms Sakshi Shairwal, Ms Abhipriya, Vivek Gurnani & Rajat Sen, Advs. for the Respondent.

Facts of the Case

Assessee-Indian National Congress was fighting a legal battle with the Income Tax Department over the recovery of tax demand. On March 8 2024, the Income Tax Appellate Tribunal (ITAT) rejected the assessee’s application for a stay on the demand recovery.

The assessee approached the Delhi High Court seeking relief.

High Court Held

The Delhi High Court held that ITAT had carefully examined the various contentions and challenges which stood raised and expressed a prima facie opinion, which alone was required while considering an application for stay.

It would be wholly inappropriate to re-examine or reconsider those questions in extenso, bearing in mind the limited evaluation that the ITAT was liable to undertake and the fact that the principal appeal was pending consideration before the ITAT.

Further, the 20% deposit mentioned in the OM dated July 31 2017 isn’t set in stone or inviolable. It’s guidance for authorities considering stay applications during appeals. The OM doesn’t guarantee the right for the assessee to claim a stay by depositing 20%. Authorities decide on a sufficient amount to secure revenue interest and maintain balance.

Given the repeated adjournments requested by the assessee and their refusal to proceed with the appeal, the court has granted permission to the assessee to file a new stay application before the ITAT, considering the recovery of Rs. 65.94 crores by the Assessing Officer, which was 48% of the outstanding demand.