Income Tax Appellate Tribunal - Mumbai
Piramal Enterprise Ltd, Mumbai vs Addl Cit Rg 7(3), Mumbai on 6 September, 2019
1 SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.) IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH "J", MUMBAI Before Shri C.N.PRASAD (JUDICIAL MEMBER) AND Shri G MANJUNATHA (ACCOUNTANT MEMBER) S.A. No.341/Mum/2019 (Arising out of ITA No.1754/Mum/2015) (Assessment Year: 2010-11) Piramal Enterprises Ltd. VS DCIT-7(3)(2) (Formerly known as Piramal Healthcare Mumbai Ltd.) Piramal Ananta, Agastya Corporate Park, Kamani Junction, LBS Marg, Kurla (West) Mumbai-400 070 PAN : AAACN4538P APPLICANT) RESPONDENT Applicant by J.D.Mistri & Madhur Aggrwal Respondent by Rajeshwar Yadav Date of hearing 05/09/2019 Date of pronouncement 06 /09/2019 O R D ER Per G MANJUNATHA: AM The assessee has filed this Stay Application, seeking stay for outstanding demand of tax and interest amounting to Rs. 74,02,75,530/- for the Assessment Year (AY) 2010-11.
2SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.)
2. The brief facts of the case are that the assesee is a public limited company, filed its return of income for AY 2010-11 on 13/10/2010, which was subsequently revised on 03/06/2011, declaring total income at Rs. 69,61,44,360/- under normal provisions of the I.T.Act, 1961 and book profit of Rs. 469,39,41,579/- under section 115JB of the I.T.Act, 1961. The assessment has been completed u/s 143(3) r.w.s. 144C(13) of the Act, determining the total income at Rs. 524,84,58,590/- and raised aggregate tax and interest demand of Rs. 157,81,75,580/-.
3. The Ld. AR, for the assesee referring to stay application filed by the assessee submitted that the demand in the captioned assessment year arose mainly on account of the action of the AO in denying deduction of Rs. 373,57,78,443/- claimed u/s 80-IC of the I.T.Act, 1961 by relying on the assessment order for AY 2008-09. Although, many other additions have been made by the AO, but majority of issues including, deduction claimed u/s 80-IC of the I.T.Act, 1961 has been decided by the Tribunal for AY 2009-10. Therefore, on merits, the assessee is having a strong case and also, the balance of convenience is in favour of the assesee, in light of the prima facie case as demonstrated above. The Ld. AR, further submitted that although, there is a assurance from the AO for not initiating coercive steps, including adjustments of refund due to the assessee for subsequent years till, the disposal of appeal for AY 2009-10 by the ITAT, but the AO has adjusted refund due to the assesee for AY 2013-14, amounting to Rs. 30,14,78,890/- and also, refund due for AY 2014-15, amounting to Rs. 54,18,59,070/- in aggregate, a sum of Rs. 83,79,00,050/- has been adjusted against outstanding demand of tax and interest , which works 3 SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.) out to 53% of the total disputed demand. He, therefore submitted that till disposal of appeal filed by the assessee by the Tribunal, the balance outstanding of Rs. 74,02,75,530/- may be stayed for a period of six months or till disposal of appeal by the Tribunal.
4. The Ld. DR, on the other hand, strongly opposing stay application filed by the assessee submitted that the assesee has failed to make out a case of prima-facie merits in its favour and also, the balance of convenience as demonstrated, in light of facts brought out by the AO. The Ld. DR, further submitted that although, the assessee claims that the issues involved in this appeal are squarely covered by the decision of ITAT for AY 2009-10, but fact of the matter is that substantial issue of rejection of deduction claimed u/s 80-IC has been set aside to the file of the AO, for further examination, which is evident from the fact that the ITAT in its order at Para 53 set aside the issue to the file of the AO for further verification of the facts. The Ld. DR, further submitted that although, few other issues are covered in favour of the assesee, but main issue is not fully covered in favour of the assesee, because of setting aside, the issue to the file of the AO. Therefore, it is incorrect on the part of the Ld.AR for the assesse to argue that the issues have been fully covered in favour of the assesee. The Ld. AR, further submitted that anyway, while deciding the stay application filed by the assessee, the issue of prima facie merits and balance of convenience has to be judged, in light of facts brought out by the assessee and also, the financial conditions put forth with evidences. In this case, the assessee has failed to make out a case of financial difficulty with evidences. Therefore, the demand shall not be stayed. He, further submitted that 4 SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.) even, in a cases the AO has granted stay for a recovery of payment, still refund due to the assessee for subsequent years can be adjusted against demand of earlier years, as per the provision of section 245 of the I.T.Act, 1961. In this regard, he relied upon the decision of Hon'ble Supreme Court, in the case of Northern Coal Fields Ltd. Vs ACIT (2017), 85 taxmann.com 78 and also, the decision of Hon'ble Madya Pradesh High Court, in the case of Northern coal Field Limited vs ACIT (2017) 81 taxmann.com 9 (MP).
5. We have heard both the parties, perused the material available on record and gone through orders of the authorities below. We have also carefully considered, case laws relied upon by the Ld. DR, as well as the Ld. AR for the assessee. The assessee is seeking stay for balance demand mainly on the ground that the department has so far adjusted a sum of Rs. 83,79,00,050/- out of refund due to the assesee for AY 2013- 14 and 2014-15 which works out to 53% of total disputed demand. The assessee, further contended that if, you consider tax demand alone excluding interest, the assesse has almost paid more than 85% disputed tax demand. Therefore, without going into the merits of the case, the balance outstanding demand needs to be stayed, till disposal of appeal filed by the assessee. The Ld. AR, for the assesee had also try to demonstrate with evidence that most of the issues involved in this appeal are covered in favour of the assesee by the decision of ITAT for AY 2009-10.
5SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.)
6. Having considered arguments of both the sides, we are of the considered view that although, the Ld. AR for the assesee fails to demonstrate that all issues involved in this appeal are covered in favour of the assessee by the decision of ITAT for earlier years, but fact of the matter remains that the department has so far recovered a sum of Rs. 83,79,00,050/-, out of refund due to the assessee for subsequent years, which works out to more than 53% of disputed demand. Further, while deciding stay application, not only need to go by merits of the case but also consider balance of convience and demand already paid by the assesee. In this case, there is no dispute that few issues are covered in favour of the assesee by the decision of ITAT for earlier year and also the assesee had given consent for adjustment of refund due for AY 2013-14 and 2014-15 to the tax demand subject to a condition that no further adjustment can be made for refunds due to the assesee for other years. Therefore, considering the facts and circumstances of this case and also taken into consideration taxes already paid by the assesee (refund adjustments), without going into the merits of the case, at this juncture, we deem it appropriate to stay, the balance demand of Rs. 74,02,75,530/-, for a period of three months from the date of this order or till disposal of appeal filed by the assessee by the Tribunal, whichever is earlier, subject to a condition that the assesee shall not dispute, the refund adjustment made by the Ld. AO for AY 2013-14 and 2014-15 amounting to Rs. 83,79,00,050/-. In case, the assessee disputes in any manner, the adjustment made by the AO towards refund due to the assessee for AY 2013-14 and AY 2014-15, then the stay granted for balance outstanding demand shall stands cancelled automatically. Accordingly, we stayed the balance demand of Rs.
6SA 341/Mum/2019 Piramal Enterprises Ltd. (Formerly known as Piramal Healthcare Ltd.) 74,02,75,530/- for a period of three months from date of this order or till disposal of appeal of the assessee by the Tribunal, whichever is earlier.
7. In the result, the Stay Application filed by the assesee is disposed- off in terms of our observations indicated hereinabove.
Order pronounced in the open court on 06.09.2019.
Sd/- Sd/-
C.N.Prasad G Manjunatha
JUDICIAL MEMBER ACCOUNTANT MEMBER
Mumbai, Dt : 06.09.2019
Thirumalesh, Sr.PS
Copy of the Order forwarded to :
1. The Appellant
2. The Respondent.
3. The CIT(A), Mumbai.
4. CIT
DR, ITAT, Mumbai
5.
BY ORDER,
6. Guard file.
स ािपत ित //True Copy//
(Asstt. Registrar)
ITAT, Mumbai