A Division Bench of the Delhi High Court has instructed the Commissioner of Income Tax (CIT) to grant a personal hearing to OYO Hotels and Homes Private Limited (OYO) to decide on the stay on their income tax demand of Rs. 1,140 crores.
OYO, the petitioner, has challenged the order that denied a stay on the recovery of the complete tax demand. The petitioner requested the department not to consider OYO as an assessee in default under Section 220(6) of the Income-tax Act, 1961, for the entire outstanding demand of Rs.11,39,93,05,320/- until the Commissioner of Income-tax (Appeals) decides on the appeal.
The court also stated that if an order is passed by the CIT that is unfavorable to OYO, the order of the CIT will not be enforced for a period of two weeks from the date when the order is received by OYO.
The Bench comprising Justice Rajiv Shakdher and Justice Tara Vitasta Ganju has observed that the CIT has not dealt with OYO’s application with regard to the order passed by the Assessing Officer (AO) under Section 220(6) of the Income Tax Act, 1961.
The court directed the CIT to dispose of the application as soon as possible, but not later than four weeks. The CIT must provide a personal hearing to the authorized representative of OYO and allow the submission of written arguments.
The Delhi High Court’s decision is a significant development for OYO in their ongoing tax dispute. The court’s directive to provide a personal hearing to OYO’s authorized representative and to allow the submission of written arguments will enable OYO to present their case effectively.
Moreover, the court’s order to stay the CIT’s decision for two weeks provides OYO with additional time to consider their legal options if the outcome is adverse to their interests. Overall, the Delhi High Court’s decision provides OYO with a fair opportunity to challenge the tax demand and protect their interests.
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