2016 (4) TMI 315 - HC - Income Tax

Recover proceedings - pre deposit - Held that - Since the petitioner had paid 25% of the demand which was also admitted by the standing counsel appearing for the respondents the impugned order dated 30.09.2015 is modified as follows There shall be an order of interim stay till the disposal of the appeal preferred by the petitioner on payment of 25% of the demand which was already paid by the petitioner. The first respondent is directed to decide the appeal and pass orders in the appeal on merits and in accordance with law within three months from the date of receipt of a copy of this order and till such time there shall be an order of interim stay.

Summary

Issues:
Challenge to order refusing stay of income tax recovery pending appeal.

Analysis:
The petitioner filed a writ petition challenging an order dated 30.09.2015, seeking a writ of Certiorarified Mandamus to prevent the second respondent from initiating recovery proceedings for Income Tax until the appeal pending before the first respondent is disposed of. The petitioner had initially appealed to the first respondent on 15.04.2015 and requested a stay on collection, but the request was denied on 04.06.2015, with instructions to deposit the amount. Subsequently, despite filing for an interim stay on 12.06.2015, the second respondent issued a notice on 14.08.2015 demanding immediate payment of Rs. 98,73,120. The petitioner then filed a Writ Petition before the Court, resulting in the notice being set aside on 11.9.2015, and the first respondent was directed to decide on the stay petition within four weeks. The first respondent finally granted a stay on 30.09.2015, requiring the petitioner to pay 40% of the demand. Dissatisfied with this order, the petitioner filed the current writ petition.

During the hearing on 08.03.2016, the Court granted an interim stay on the condition that the petitioner pay 25% of the demand within ten days. Both parties confirmed compliance with this order during a subsequent hearing. Consequently, the impugned order dated 30.09.2015 was modified to allow for an interim stay until the appeal's disposal, based on the petitioner's payment of 25% of the demand. The first respondent was directed to decide on the appeal within three months from the date of the modified order. The writ petition was disposed of with no costs, and the connected MP was closed.