Income Tax Appellate Tribunal - Delhi
Rockland Diagnostics Services P.Ltd, ... vs Ito, Ward-21(3), New Delhi on 31 January, 2020
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH 'FRIDAY' : NEW DELHI)
BEFORE SHRI N.K. BILLAIAY, ACCOUNTANT MEMBER
and
SHRI KULDIP SINGH, JUDICIAL MEMBER
Stay Application No.73/Del/2020
(in ITA No.316/Del./2019)
(ASSESSMENT YEAR : 2015-16)
M/s. Rockland Diagnostics Services P.Ltd., vs. ITO, Ward 21 (3),
C/o Shri Ravi Gupta, Advocate New Delhi.
E - 6A, Kailash Colony,
New Delhi - 110 048.
(PAN : AAGCR7840C)
(APPLICANT) (RESPONDENT)
APPLICANT/ASSESSEE BY : Shri K.M. Gupta, Advocate
Shri Vinay Verma, Advocate
REVENUE BY : Ms. Rakhi Vimal, Senior DR
Date of Hearing : 31.01.2020
Date of Order : 31.01.2020
ORDER
PER KULDIP SINGH, JUDICIAL MEMBER :
Applicant, M/s. Rockland Diagnostics Services P. Ltd. (hereinafter referred to as 'the assessee') by filing the present stay application under Rule 35A of the Income Tax (Appellate) Tribunal Rules, 1963 sought to stay the impugned demand of Rs.43,29,410/- on the grounds inter alia that Rockland Hospitals Ltd. has subscribed to 3,26,741 equity shares of the assessee company @ Rs.10/- each (Rs.32,67,410/-) along with share 2 Stay No.73/Del./2020 premium of Rs.33/- (Rs.1,07,82,453/-) for the purpose of running the ancillary services like in-house diagnostic centre, laboratories etc.; that shares of assessee company has been valued on the Discounted Cash Flow (DCF) method which included valuation of upcoming business prospects of the company; that AO disregarded the valuation report primarily on the ground that valuation of equity shares was based on projection of revenue which did not match with the actual revenue of the subsequent years and made disallowance u/s 56(2)(viib); that AO also disallowed the ROC fees paid by treating the same as revenue expenditure; that prima facie case and balance of convenience is made out in favour of the assessee who will suffer business hardship in case demand is not stayed; that assessee has already paid an amount of Rs.5,00,000/- after assessment.
2. Ld. DR for the Revenue opposed the stay application on the grounds inter alia that the demand raised by the Revenue is prima facie sustainable; that in case demand raised by the Revenue is to be stayed, the assessee should be made to pay at least 50% of the impugned demand.
3. We have heard Ld. Authorized representatives of both the parties and have perused the material on record in the light of facts and circumstances of the case and orders of tax authorities below. 3 Stay No.73/Del./2020
4. Keeping in view the facts inter alia that the issue as to disallowance u/s 56(2)(viib) by disregarding the valuation report has an arguable point and requires to be disposed off on merits; that prima facie disallowance of ROC fees paid by the company is not sustainable; that prima facie case and balance of convenience is made out in favour of the assessee who will suffer business hardship in case impugned demand is not stayed and that the assessee has already paid an amount of Rs.5,00,000/- against the impugned demand after assessment; the impugned demand is stayed on further depositing of Rs.5,00,000/- (Rupees Five lakhs only) on or before 20.02.2020 for the period of 180 days or till the disposal of the appeal whichever is earlier, subject to the rider that the assessee shall not take unnecessary adjournment to prolong the appeal otherwise stay order would cease to operate. The appeal is listed for hearing for 07.04.2020.
Order pronounced in open court on this 31st day of January, 2020 after the conclusion of the hearing .
Sd/- sd/-
(N.K. BILLAIYA) (KULDIP SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated the 31st day of January, 2020
TS
4 Stay No.73/Del./2020
Copy forwarded to:
1.Appellant
2.Respondent
3.CIT
4.CIT
5.CIT(ITAT), New Delhi. AR, ITAT
NEW DELHI.