COMMISSIONER OF INCOME TAX, FARIDABAD vs. SANJAY KUMAR, H.NO. 432, SECTOR-21A, FARIDABAD

Facts

The Revenue, Commissioner of Income Tax, Faridabad, is in appeal before the High Court of Punjab and Haryana at Chandigarh. The appeal challenges orders dated March 17, 2011, passed by the CIT(A) and July 22, 2011, passed by the Income Tax Appellate Tribunal (ITAT), Delhi Bench 'G'. The appeal was filed with a delay of 766 days, which the High Court condoned. The core of the dispute revolves around the jurisdiction of the CIT(A) to grant a stay and permit payment of a demand in installments.

Held

The High Court held that the question raised by the Revenue has been rendered academic because the assessee has already deposited the amount in installments. Furthermore, the Court agreed with the views of the Allahabad High Court in Prem Parkash Tripathi v. Commissioner of Income-tax, the Madras High Court in Paulsons Litho Works v. Income-tax Officer, and the Rajasthan High Court in Maheshwari Agro Industries v. Union of India. These High Courts have held that inherent in the power of appeal is the power to grant interim relief on such terms and conditions as meet the parameters of a judicial or quasi-judicial order. Consequently, the High Court found no merit in the appeal, answered the question against the Revenue, and dismissed the appeal.

Key Issues

1. Whether the CIT(A) has the jurisdiction to grant a stay and direct payment of an assessed demand in installments, as per Section 251 of the Income Tax Act, 1961? (Question of law) The Revenue contended that Section 251 of the Income Tax Act, 1961, does not confer any power upon the CIT(A) to entertain an application for stay or to order payment of a demand in installments, irrespective of how equitable the relief granted may be. The Revenue argued that the CIT(A) lacked the jurisdiction to grant such relief. The Assessee's contentions were not recorded in the judgment.