The Income Tax Appellate Tribunal (ITAT), Bangalore has granted partial relief to Google Ireland where the Tribunal expedited the hearing and posted the matter for final hearing on 16th September 2021.
Facts of the case:-
The Assessing Officer has assessed an income of Rs.93.66 crores as royalty and passed an order against the assessee-Company and demanded approximately 33 crores rupees as tax. The assessee challenged the above order on appeal and filed an application for a stay where a stay of demand was granted. The assessee challenged the final assessment order by filing an appeal before the Tribunal on 19-04-2021 along with the present Stay application, which was finally disposed by the High Court on 17th April 2021 wherein the Court quashed all the Tribunal orders and directed the department to start the proceedings afresh.
Interpretation of law:-
The assessee contended before the Tribunal that the assessing officer has passed the impugned assessment order in order to give effect to the order passed by the Tribunal. However, the said order of the Tribunal has since been set aside by the Hon’ble High Court of Karnataka and therefore, the entire tax demand raised on the assessee by the impugned assessment order deserves to be set aside. It was also contended that the assessee deserves a full stay of the outstanding demand.
The bench comprising Judicial Member Beena Pillai and Accountant Member B R Bhaskaran has partly allowed the stay application and held that “the order so passed by ITAT has been set aside by Hon’ble High Court of Karnataka and the entire matter has been remanded back to the Tribunal, meaning thereby, status quo ante has been restored. The effect is that the earlier appeal filed by the assessee in IT(IT)A No.2845/Bang/2017 has been revived and pending before the Tribunal for final disposal. When enquired with the Registry, they informed us that the above-said appeal has been posted for hearing on 16th September, 2021.” “In view of the above discussed legal position, a specific query was posed to the counsel as to the legal effect of the impugned demand. He submitted that the assessee seeks to stay on a safer course. The Ld A.R, in the alternative, submitted that the assessee may be granted an early hearing of the appeal. Having regard to the rival submissions, we are of the view that the balance of convenience is in favor of granting an early hearing of the appeal of the assessee. Accordingly, we direct the registry to post the appeal of the assessee numbered as IT(IT)A No.166/Bang/2021 for a final hearing on 16th September, 2021. Since the date of hearing is announced in the open court in the presence of both the parties, the registry may desist from sending formal notice of hearing to the parties,” the Tribunal said.