Shri D.A Shyam Sunde... v. The Deputy Commissio..., Income Tax Appellate Tribunal, Judgment, Law, casemine.com

Citation Codes

Equivalent Citations

citation codes

Case Number

S.P No. 121.Bang/2011, (in ITA No. 776.Bang/2011), (Assessment Year 2008-09)

Attorney(S)

Appellant/Petitioner by: Shri S.R Kiron, C.A
Respondent by: Shri G.V Gopala Rao, CIT-I

Judges

N. Barathvaja Sankar, V.P
George George K., J.M

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Smart Summary

Factual and Procedural Background

The assessee, an individual trader in gold jewellery, filed a return of income for the assessment year 2008-09 declaring a total income of Rs.31,09,390/-. The scrutiny assessment under section 143(3) of the Income Tax Act was completed on 30.12.2010, wherein the Assessing Officer (AO) made an addition of Rs.1,37,98,322/- due to a difference in valuation of closing stock. The AO adopted the FIFO (First In First Out) method for valuing the closing stock, resulting in a higher valuation of Rs.2,85,51,202/-, compared to the average cost method used by the assessee, which valued it at Rs.1,47,52,880/-. The Commissioner of Income Tax (Appeals) [CIT(A)] affirmed the AO's view on 8.8.2011. The assessee filed an appeal before the Income Tax Appellate Tribunal (Tribunal) as well as a stay petition seeking to stay recovery of the disputed tax amounting to Rs.59,26,758/-. The stay petition was taken up for hearing on 7.10.2011, during which it was stated that the AO was threatening coercive recovery measures and the assessee expressed confidence in succeeding on appeal but was unable to pay the disputed amount. The assessee alternatively requested an early hearing of the appeal if the stay was refused. The Departmental Representative (DR) opposed the stay petition.

Legal Issues Presented

Whether the stay against recovery of the disputed tax amounting to Rs.59,26,758/- should be granted pending the appeal before the Tribunal.
Whether the appeal filed by the assessee can be expedited for early hearing to avoid coercive recovery steps.

Arguments of the Parties

Appellant's Arguments

The assessee contended that the disputed tax recovery should be stayed as the appeal is likely to succeed.
The assessee submitted inability to pay any portion of the disputed tax during the pendency of the appeal.
Alternatively, the assessee requested an early hearing of the appeal in case the stay was refused.

Respondent's Arguments

The Departmental Representative opposed the grant of stay against the recovery of tax.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court considered the submissions of both parties and reviewed the record. It noted the assessee's request for stay against recovery of disputed tax and the alternative request for early hearing of the appeal. The court found that the appeal could be disposed of without much delay and thus directed the Registry to list the appeal for final hearing on 27/10/2011. Given the imminent hearing date, the court concluded that there was no justification to grant the stay petition. The reasoning reflects a balancing of the assessee’s hardship against the need to avoid undue delay in adjudication, ensuring that the appeal is heard expeditiously to obviate the need for stay.

Holding and Implications

The court's final decision was to dismiss the Stay Petition filed by the assessee.

The immediate effect is that the recovery of the disputed tax amounting to Rs.59,26,758/- is not stayed and may proceed. However, the appeal is scheduled for final hearing shortly, which implies that the dispute will be resolved expeditiously. No new legal precedent was established by this order; it primarily manages procedural aspects to ensure timely disposal of the appeal.

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Shri D.A Shyam Sunder, 608, Avenue Road, Next To Rice Memoriam Church, Bangalore-1 / v. The Deputy Commissioner Of Income Tax, Circle 2(1), Bangalore .

PER GEORGE GEORGE K : This Stay Petition is filed by the assessee for seeking stay against the recovery of outstanding tax amounting to Rs.59,26,758/-

2. Brief facts of the issue are as follows:- The assessee, an individual, is a trader in gold jewellery. For the concerned asst. year, viz. 2008-09, return of income was filed Page 2 of 3 S.P. No.121/Bang/2011 on 28.9.2008 declaring a total income of Rs.31,09,390/-. Scrutiny assessment u/s 143(3) of the Act was completed vide order dated 30.12.2010. In the scrutiny assessment completed, an addition of Rs.1,37,98,322/- was made by the AO on account of difference in valuation of closing stock. The AO adopted (First In First Out) FIFO method of valuing closing stock as against the average cost method adopted by the assessee and brought to tax Rs.1,37,98,322/- being difference between FIFO method as worked out by the AO amounting to Rs.2,85,51,202/- and the value adopted by the assessee under the average cost method amounting to Rs.1,47,52,880/-.

3. The view of the AO was affirmed by the CIT(A) in his order dated 8.8.2011.

4. The assessee being aggrieved has filed an appeal before the Tribunal (ITA No.776/Bang/2011) and also the stay application (S P No.121/Bang/2011). The Stay Application was taken up for hearing today on the 7th October, 2011. It was stated that the AO is threatening to take coercive steps to recover the disputed tax. It was submitted that the assessee is confident of succeeding in the appeal filed before the Tribunal and is unable to pay any portion of the tax that is disputed in the appeal. Alternatively it was contended that an early hearing of the appeal may be granted in the event the stay is refused. Page 3 of 3 S.P. No.121/Bang/2011

5. The learned DR opposed the grant of stay against the recovery of tax.

6. We have heard the rival submissions and perused the material on record. We are of the view; the appeal can be disposed off without much delay. Accordingly, the Registry is directed to post the case for final hearing on 27/10/2011. Since the appeal has been posted for final hearing to 27/10/2011, the Stay Petition filed by the assessee is rejected.

7. In the result, the Stay Petition filed by the assessee is dismissed. Sd/- Sd/- (N BARATHVAJA SANKAR) (GEORGE GEORGE K) VICE PRESIDENT JUDICIAL MEMBER Bangalore, Dt.07/10/2011 Copy to : 1. The Revenue 2. The Assessee 3. The CIT concerned.

4. The CIT(A) concerned. 5. DR 6. GF MSP/ By order Asst. Registrar, ITAT, Bangalore.

Shri D.A Shyam Sunde... v. The Deputy Commissio...