2023 PLP (Trib (PTD)

Date of hearing: 25th March, 2022. ORDER ON STAY APPLICATION HABIB ULLAH KHAN, ACCOUNTANT MEMBER.

By this order, we intend to dispose off above titled miscellaneous application moved by the appellant wherein extension of stay against the recovery of tax demand has been requested which is the subject matter of the appeal bearing ITA No.345/KB/2021, pending before this Tribunal.

2. The learned A.R of the appellant has contended that under the facts and circumstances of the case, this Tribunal had already granted stay for a total of 360 days in different stay orders and latest of which has been expired on 23-03-2022. He further added that if stay is not granted, the appellant shall suffer irreparable loss. He has submitted that the provisions of Section 131(5) of the Income Tax Ordinance, 2001 is directory and not mandatory in nature and the Tribunal is duly empowered to grant stay for more than 180 days. In support of his contention, the learned AR has relied upon the case reported as 2016 PTD 1702 [Islamabad High Court] and unreported case bearing M.A. (Stay) Ext. No.726/KB/2017, MA(Stay) No.1242/KB/2018 dated 13-07.2018, MA (Stay) Nos.1213 to 1216/KB/2018 dated 09-07-2018. Finally, he prayed that the stay already granted by this Tribunal may please further be extended. He has further submitted that the appellant has a prima facie good case with every likelihood of success.

3. On the other hand, learned DR strongly opposed further stay.

4. We have heard the arguments of learned representative of learned counsel for the appellant/taxpayer and perused the available record of the case, gone through the decisions of the Hon'ble High Court and of the Tribunal and found that this Tribunal has already granted stay to the appellant for aggregated period of 360 days in portions. There is no change in facts and circumstances of the case as were prevailing earlier. However, before venturing further, it would be advantageous to refer to subsection (8) of Section 30 of the Finance Act, 2018, quoted as follows:-- "(30) in section 131 in subsection (5) in the first proviso for expression at the end a colon shall be substituted and thereafter the following new proviso shall be inserted namely:- "Provided further that where recovery of tax has been stayed under this section, such stay order shall cease to have effect on expiration of the said period of one hundred and eighty days following the date on which the stay order was made and the Commissioner shall proceed to recover the said tax."

5. The applicability of section 8(30) of the Finance Act, 2018 reproduced above has been examined in the light of the circumstances of the case, which shows no delinquency on the part of the appellant. In the light of judgment of the Hon'able Islamabad High Court reported as 2016 PTD 1702 as well as considering the fact that main appeal is pending before this Tribunal, there exist special circumstances.

6. Furthermore, the provision of law introduced through Finance Act, 2018 was carefully examined in the light of the recent judgment of Hon'ble Islamabad High Court in W.P.No.2608 of 2018 (M/s. Holmore Power Generation Company Ltd. v. Deputy Commissioner, I.R and others) dated 04.08.2018. In the said order the Hon'ble High Court it has inter alia been mentioned that: "Indeed, the A.T.I.R. is empowered to grant interim relief for a period of 180 days. However, it presuppose that appeals would be decided by the ATIR within the said period. Failure on the part of the ATIR to decide the appeal within the said period cannot operate to the prejudice of the petitioner/appellant who is not responsible for causing of delay in adjudication of the appeal"

7. Notwithstanding the above legal position, on the issue of stay of demand honorable Lahore High Court has recently issued an interim order in the case of Omega Industries in Writ Petition No.26556 of 2020 by observing that no application for interim relief is to be fixed before the Inland Revenue Tribunals without main appeal. In order to adjudicate the miscellaneous application for stay in the light of the order of the honorable Court (quoted supra), the main appeal was also heard in the Instant case along with the application which will be disposed off through a separate order by adjudicating the grounds of the main appeal stated therein. At this stage, after considering the peculiar facts of the case stated in the main grounds of appeal, we have considered that in order to provide temporary relief to the appellant from the 'undue hardship', it would be appropriate to grant stay till the disposal of main appeal and in the meanwhile, the main appeal will also be decided through a separate order. Order accordingly. SA/38/Tax (Trib.) Stay granted.