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2014 (11) TMI 952 - HC - Income TaxGrant of stay of demand – Stay petition rejected – Cardinal test for granting stay, prima facie case and balance of convenience - Whether the first respondent ignoring its earlier order in respect of the AYs 2009-10 to 2011-12 is required to pass an order on the Stay Petition to stay the demand - Held that:- A notice was issued to the assessee on 19.9.2014, calling upon the assessee to produce copies of Books of Accounts maintained by them, to verify the balances/fund available as on date - unless and until the assessee places materials before the first respondent, pleading financial incapacity or inability to pay the demand, pending decision of the Appeal, the authority who is consider the Stay Petition cannot be faulted for having taken a decision that the petitioner/applicant has not established a prima facie case - Section 220 of the act would treat an assessee to be an assessee in default when he does not meet the tax liability in respect of the demand raised by demand notice under section 156 of the Act - The discretion conferred on the AO u/s 220(6) is not an arbitrary power, but a power coupled with responsibility and the assessing officer concerned should take all the circumstances into account and all the considerations that could be urged by the assessee as to why he should not be treated as "not being in default" and then make an order as is provided to the facts of the case. Though the reasoning of the first respondent while rejecting the Stay Petition cannot be faulted in its entirety, but the fact that on the date when the order was passed, the CIT(A) ought to have noted that the appeal arising out of the assessment orders for the years 2007-08 and 2008-09, has been entertained and interim order has also been granted - If the legal issue is now pending before the Hon'ble Division Bench of the Court and order of interim stay has been granted, subject to certain conditions, that should have been considered by the first respondent while passing the impugned order dated 17.10.2014 – certain questions of law admitted for consideration – Assessee is directed to deposit 50% of the entire demand in respect of all the three AYs viz. 2012-13, 2013-14 and 2014-15 and the remaining amount demanded shall remain stayed till the disposal of the appeal – partial stay granted.
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