IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF JULY, 2019 BEFORE THE HON’BLE MRS.JUSTICE S.SUJATHA WRIT PETITION NO.25178 OF 2019(T-IT) BETWEEN:
M/s Sterling Urban Developments Private Limited, Level 5, Prestige Nebula, No.8, Cubbon Road, Opposite to Income Tax Building, Bengaluru-560 001.
Represented by its Director Sri. Ramani Sastri.
(By Sri. Udaya Holla, Senior Advocate for Sri. Vivek Holla, Advocate) AND :
The Deputy Commissioner of Income-Tax Circle-6(1)(2), Bengaluru-560 009.
... Petitioner … Respondent (By Sri. Jeevan J Neeralgi, Advocate) This Writ Petition filed under Articles 226 and 227 of the Constitution of India, praying to quash the order dated 22.02.2019 passed by the Income tax Tribunal, ‘B’ Bench, Bengaluru, passed (Annexure-G).
This Writ Petition coming on for Preliminary Hearing ‘B’ Group, this day, the Court made the following:
O R D E R The petitioner has challenged the order dated 22.02.2019 passed by the Income Tax Appellate Tribunal, ‘B’ Bench, Bengaluru, in SP No.59/BANG/2019 inter alia challenging the assessment Order dated 12.10.2018 passed by Deputy Commissioner of Income Tax Circle 6(1)(2), Bengaluru (Annexure-B) and the consequential Demand Notice issued under Section 156 to the Income Tax Act 1961(‘Act’ for short).
2. The petitioner is claiming to be a Private Limited Company incorporated under the provision of the Companies Act, 1956. Relating to the assessment year 2014-2015, the appellant has filed its return of Income on 29.11.2014 declaring loss of Rs.74,44,09,458/-. A notice under Section 143(2) of the Act was originally issued. Thereafter, a notice under Section 129 read with Section 142(1) of the Act was issued by the respondent. After hearing, the Assessing Officer referred the case to the Transfer Pricing Officer to re-determine the Arm’s length Price of the International Transactions and specified Domestic Transactions of petitioner with its Associated Enterprises and related parties covered under Section 40A (2) (b) of the Act. After hearing the petitioner, the Transfer Pricing Officer passed an order under Section 92CA of the Act on 31.10.2017 by making an adjustment of Rs.94,25,45,710/-. The Assessing Officer passed an assessment order on 12.10.2018 based on the Transfer Pricing adjustment made by the Transfer Officer and made a tax demand of Rs.9,29,93,360/-. In furtherance to the assessment order, a Demand Notice was also issued. Aggrieved by the same, the petitioner preferred a petition before the Dispute Resolution Panel which came to be disposed of confirming the order of the Assessing Officer. On further appeal before the Income Tax Appellate Tribunal (’ITAT’ for short), the petitioner had filed an application for stay of the demand putting forth the financial hardship faced by the petitioner assessee. The said application has been rejected by the impugned order dated 22.02.2019. Hence, this writ petition.
3. Learned Senior counsel Sri Udaya Holla appearing for the petitioner would submit that the order impugned is a non speaking order, no reasons are assigned by the ITAT in rejecting the said petition, hence, deserves to be set aside.
4. Learned counsel for the Revenue though made an endeavor to justify the impugned order fairly submits that the matter requires reconsideration by the ITAT.
5. Having heard the learned counsel for respective parties and perusing the materials on record, it is ex-facie apparent that the order impugned is a cryptic order passed by the ITAT without assigning valid reasons. No stay petition would have been dismissed outrightly for recovery of the outstanding demand. Even if the petitioner-assessee makes a request to grant an absolute stay, the ITAT has to apply its mind to all the possible avenues that are available for the dispensation of justice. If absolute stay is not possible, parameters of conditional stay has to be examined and an appropriate decision has to be taken in the circumstances of the case.
6. For the foregoing reasons, the order impugned cannot be approved and the same deserves to be set aside. Accordingly, the order at Annexure-G dated 22.02.2019 is set aside and the proceedings are remanded to ITAT for re-consideration. The ITAT shall re-consider the matter in accordance with law and decision shall be taken in an expedite manner preferably within a period of six weeks from the date of certified copy of the order. All the rights and contentions of the parties are left open.
The writ petition stands disposed of in terms of the above.
Sd/- JUDGE ag