ROHIT TANDON vs. INCOME TAX APPELLATE TRIBUNAL AMRITSAR

Facts

The petitioner, Rohit Tandon, filed multiple writ petitions (CWP Nos. 8352, 8356, 8386, and 8388 of 2014) before the High Court of Punjab & Haryana. An appeal filed by the assessee was pending before the Income Tax Appellate Tribunal (ITAT), Amritsar. The ITAT had initially granted an interim stay, which was statutorily vacated under Section 254(2-A) of the Income Tax Act, 1961. The petitioner sought an extension of this stay until the disposal of the appeal. The revenue contended that the stay order, having been vacated by operation of law, could not be extended under Article 226 of the Constitution.

Held

The High Court, without opining on whether Section 254(2-A) of the Income Tax Act, 1961, is mandatory or directory, disposed of the writ petitions. The Tribunal was directed to decide the petitioner's appeal within three months from the date of the order. The interim stay granted by the Tribunal was ordered to continue for this three-month period, subject to the petitioner filing an undertaking before the Tribunal that he would not delay the disposal of the appeal. The operative direction was to expedite the adjudication of the pending appeal.

Key Issues

1. Whether the interim stay granted by the ITAT, having been statutorily vacated under Section 254(2-A) of the Income Tax Act, 1961, can be extended by the High Court in exercise of its powers under Article 226 of the Constitution of India? (Question of law) Assessee's Contention: The petitioner sought an extension of the stay order until the final decision of the appeal pending before the ITAT. Revenue's Contention: The revenue argued that as the stay order stood vacated by operation of Section 254(2-A) of the Act, the High Court could not extend it under Article 226 of the Constitution.