| Case ID |
2e0a3f92-4f4c-4df3-b096-ea52f32b5a24 |
| Body |
View case body. Login to View |
| Case Number |
W.P. (C) Nos. 1334 OF 2015 AND 1934, 1935, 2326, 2 |
| Decision Date |
May 19, 2015 |
| Hearing Date |
|
| Decision |
The Delhi High Court ruled on the constitutional validity of the third proviso to Section 254(2A) of the Income Tax Act, 1961. The amendment introduced by the Finance Act, 2008 was challenged, which stated that the Appellate Tribunal could not extend the stay beyond 365 days even if the delay was not attributable to the assessee. The court found this provision to be arbitrary and violative of Article 14 of the Constitution, as it treated assessees who were not responsible for delays equally with those who were. The court reinstated the power of the Tribunal to grant extensions of stay beyond 365 days if the delay was not due to the assessee's conduct, thus aligning with the earlier ruling of the Bombay High Court in Narang Overseas (P.) Ltd. |
| Summary |
In the landmark ruling by the Delhi High Court on May 19, 2015, the court examined the constitutional validity of Section 254(2A) of the Income Tax Act, 1961, particularly focusing on the amendments made by the Finance Act, 2008. The core issue revolved around the restriction imposed on the Income Tax Appellate Tribunal's ability to extend stay orders beyond 365 days, irrespective of whether the delay was attributable to the assessee. The High Court's decision emphasized the importance of maintaining a fair judicial process, highlighting the arbitrary nature of the amendment which effectively rendered the right of appeal illusory for compliant assessees. The ruling underscored that the Tribunal retains the authority to extend stay orders in deserving cases, ensuring that the legal rights of assessees are protected. The case reaffirms the principles of justice and equity within the framework of tax law, making it a significant reference point for future litigation and legal interpretations in the realm of income tax. |
| Court |
Delhi High Court
|
| Entities Involved |
Pepsi Foods Pvt. Ltd.,
Astt. Commissioner of Income Tax
|
| Judges |
Badar Durrez Ahmed,
Sanjeev Sachdeva
|
| Lawyers |
Deepak Chopra,
Piyush Singh,
Amit Shrivastava,
Harpreet Ajmani,
Ms. Rashi Khanna,
Ms. Ananya Kapoor,
M.S. Syali, Sr. Adv.,
Mayank Nagi,
Harkunal Singh,
Tarun Singh,
Ms. Rashmi Chopra
|
| Petitioners |
others,
Pepsi Foods Pvt. Ltd.
|
| Respondents |
other,
Astt. Commissioner of Income Tax
|
| Citations |
2015 SLD 2061,
(2015) 112 TAX 100,
(2015) 232 TAXMAN 78
|
| Other Citations |
ITO v. M.K. Mohammed Kunhi [1969] 71 ITR 815 (SC),
Wire Netting Store v. Regional Provident Fund Commissioner [1984] 1 ILR 76 (Delhi) (DB),
Mardia Chemicals Ltd. v. Union of India [2004] 4 SCC 311,
Narang Overseas (P.) Ltd. (supra),
PML Industries Ltd. v. CCE [2013] 31 taxmann.com 382/39 STT 302 (Punj. & Har.) (DB),
CIT v. Maruti Suzuki (India) Ltd. [2014] 362 ITR 215/44 taxmann.com 166 (Delhi) (DB),
Dr. Subramanian Swamy v. Director, CBI [2014] 8 SCC 682 (SC)
|
| Laws Involved |
Income Tax Act, 1961
|
| Sections |
254(2A),
254,
254(1),
253(1)
|