THE PR. COMMISSIONER OF INCOME TAX -6 vs. MSD PHARMACEUTICALS PVT. LTD.
What did the High Court hold?
The High Court held that no substantial question of law arises in the present appeal. The Court relied on its own previous decision in Pepsi Foods Co. Pvt. Ltd. v. Assistant Commissioner of Income Tax & Anr, 2015 376 ITR 87. In that judgment, this Court had ruled that the Income Tax Appellate Tribunal possesses the power to extend a stay order beyond the period of 365 days, even in light of the second proviso to Section 254(2A) of the Income Tax Act. Consequently, the appeal filed by the Revenue was dismissed.
What were the facts?
The Revenue is appealing an order dated March 8, 2019, passed by the Income Tax Appellate Tribunal (ITAT). This order extended a stay granted to the Respondent-assessee, MSD Pharmaceuticals Pvt. Ltd., beyond the statutory period of 365 days. The stay pertained to appeals for assessment years 2010-11 and 2011-12. The Revenue's challenge is based on the interpretation of the second proviso to Section 254(2A) of the Income Tax Act, which limits the duration of interim stay orders.
What were the issues?
1. Whether the Tribunal has the power to extend a stay order beyond 365 days, notwithstanding the second proviso to Section 254(2A) of the Income Tax Act, 1961? The Revenue contends that the Tribunal cannot extend the stay beyond 365 days as stipulated by the second proviso to Section 254(2A). The assessee, through its counsel, relies on the decision of the High Court in Pepsi Foods Co. Pvt. Ltd. v. Assistant Commissioner of Income Tax & Anr, 2015 376 ITR 87, which held that the Tribunal can indeed extend the stay beyond 365 days.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
$~36 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 868/2019 THE PR. COMMISSIONER OF INCOME TAX -6 ..... Appellant Through: Mr. Ruchir Bhatia, Advocate. versus MSD PHARMACEUTICALS PVT. LTD. ..... Respondent Through: Ms. Rashmi Chopra and Mr. Harpreet Singh Ajmani, Advocates. CORAM: HON'BLE MR. JUSTICE VIPIN SANGHI HON'BLE MR. JUSTICE SANJEEV NARULA O R D E R % 27.09.2019 C.M. No. 43453/2019 (exemption) 1. Exemption allowed, subject to all just exceptions. 2. The application stands disposed of. ITA 868/2019 3. The Revenue assails the order dated 08.03.2019 passed by the ITAT in S.A. No. 230/Del/2019 arising out of ITA No. 1423/Del/2015 for the assessment year 2010-11 and S.A. No. 231/Del/2019 arising out of ITA No. 1382/Del/2016 for the assessment year 2011-12. By the impugned order, the Tribunal has extended the stay granted by it in favour of the Respondent- assessee beyond the period of 365 days. The issue sought to be raised by the Revenue is covered by the decision of this Court in Pepsi Foods Co. Pvt. Ltd. v. Assistant Commissioner of Income Tax & Anr, 2015 376 ITR 87. This Court has held that the Tribunal can extend the stay beyond the period
of 365 days despite the second proviso under Section 254 (2A) of the Income Tax Act. 4. Thus no question of law arises in the present appeal and the same is dismissed. VIPIN SANGHI, J SANJEEV NARULA, J SEPTEMBER 27, 2019 nk
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