W.P.(C)/12627/2026 of AKAMAI TECHNOLOGIES INTERNATIONAL AG Vs ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE INT TAX 1 1 1 DELHI & ANR. on 15 September 2026

O R D E R

% 15.09.2026

1. The present writ petition has been preferred by the Petitioner seeking the following reliefs: “a) Writ in the nature of certiorari, mandamus or any order appropriate writ, order or direction for quashing of the Impugned Order dated 17.08.2026 for the AY 2023-24 and all consequential proceedings thereto.

b) Writ in the nature of mandamus or any order appropriate writ, order or direction, directing the Respondents to give due credit to the EL amounting to Rs. 13,34,81, 786/-, constituting approximately 23.59% of the purported outstanding demand, and to keep recovery of the balance demand in abeyance pending disposal of the Petitioner's appeal before the Tribunal.

c) Writ in the nature of mandamus or any order appropriate writ, order or direction, directing the Respondents to refund the EL amounting to Rs. 13,82,67,125 - (including interest on late payment amounting to Rs. 47,85,339/-) already paid by the Petitioner, along with applicable interest thereon, in accordance with law.”

2. On hearing Mr. Jolly, learned Senior Counsel, though the Court was of the view that the Income tax Appellate Tribunal ("ITAT") could consider the application for stay of demand, but it had its own doubt regarding power of the Ld. ITAT to allow adjustment of equalization levy against tax demand under the Income tax Act, 1961, as prayed in Clause (C) above. Thus, on 1st September 2026, the following order was passed : “1. Mr. Sachit Jolly, learned Senior Counsel for the petitioner submitted that for the time being, he would not press his prayers (a) and (b), if a direction is issued to the respondents to either refund the equalization levy of about 13 crores, which the petitioner has paid, or the Assessing Officer is directed to adjust the equalization levy so paid, against the outstanding demand of the assessee for the Assessment Year 2023-24. As the same would roughly meet more than 20% of the total outstanding demand.

2. Mr. Indruj Singh Rai, learned Senior Standing Counsel for the respondents prays for and is granted three days' time to complete the instructions.”

3. Mr Indruj Singh Rai, Senior Standing Counsel, has on instructions, suggested the following:

(i) Since the appeal of the Petitioner is pending before the Ld. ITAT, the Petitioner should move an application for stay of outstanding income tax demand before the Ld. ITAT;

(ii) He has further suggested that the amount equivalent to amount deposited as equalization i.e. Rs. 13, 34, 81,786/- may be ordered to be considered for the purposes of stay of demand.

(iii) He however submitted that until the appeal is finally decided, the characterisation of the payment as equalization levy should not be altered.

iv) This arrangement should be only an ad-interim measure in the facts of the present case.

4. Mr. Sachit Jolly, Ld. Senior Advocate, appearing on behalf of the Petitioner agreed with the fair proposition made by Mr. Rai.

5. Since both the parties are ad-idem, we propose to pass the following directions:

(i) Petitioner may file an application for stay of the outstanding income tax demand before the Ld. ITAT within two weeks from today.

(ii) The Ld. ITAT will consider the stay application on its own merits.

(iii) If the Ld. ITAT finds any deposit of income tax is required for the purposes of the stay, it shall consider the amount equivalent to the amount of equalization levy already paid by the Petitioner, while determining the total amount of income tax payable while granting the stay, if any. In other words, if the Ld. ITAT finds it a fit case to grant stay, but requires some deposit of income tax, it shall consider that a substantial amount in the form of equalization levy has been paid by the Petitioner. In case the ITAT feels that amount more than the amount of equalisation levy is required to be deposited as a condition of grant of stay, then only the Ld. ITAT shall require the Petitioner to deposit any further amount. We make it clear that this is only an ad-interim arrangement and the original character of amount of Rs. 13, 34, 81,786/- paid as equalization levy will not be altered by virtue of this arrangement and such amount will continue to be treated as equalization levy despite it being considered for the limited purpose of quantification of deposit of tax while granting stay, if any, subject of course to final adjudication by the Tribunal.

iv) The Respondent shall not take any measure to recover the outstanding demand till the Ld. ITAT decides the stay application. In case the Petitioner does not file stay application within two weeks from today, the Respondent shall be free to take appropriate steps in accordance with law.

6. With the aforesaid directions, the petition stands disposed of. DINESH MEHTA, J. RAJNEESH KUMAR GUPTA, J. SEPTEMBER 15, 2026/MR