IMPORTANT POINT
Authorities must provide reasoned decisions when rejecting stay applications and consider claims of financial hardship, ensuring compliance with principles of natural justice.

JUDGMENT/ORDER

BHARAT P.DESHPANDE, J. - Rule. The Rule is made returnable forthwith. The matter is taken up for final disposal with the consent of both the parties.

2. The petitioner-Corporation is challenging the impugned order dtd. 2/12/2022 passed by respondent no.1 wherein the stay application filed by the petitioner was rejected only on the ground that the petitioner failed to deposit 20% of the disputed demand immediately.

3. Heard Shri Devidas J. Pangam, learned Advocate General along with Ms Maria Correia, learned Additional Government Advocate for the petitioner and Mr K. V. Aravind, learned Senior Standing Counsel for the Revenue.

4. Shri Pangam would submit that the petitioner received a notice under Sec. 148 of Income Tax Act dated 30.03,2021 requiring the petitioner to file return of the income for the assessment year 2017-18. Accordingly, on 27/4/2021 returns were filed disclosing loss of Rs.18805160.00.

5. Shri Pangam would then submit that though notices under Sec. 143(2) and 142(1) of the Income Tax Act were issued, the staff of the petitioner were not aware of such notices as at the relevant time most of the staff of the petitioner-Corporation was on auction duty and, thereafter, on election duty. The notices were not responded to because of above reasons. The Assessing Officer resorted to best judgment assessment under Sec. 144 of the Income Tax Act and passed an order on 26/3/2022 under Sec. 147 r/w Sec. 144 r/w Sec. 144B of the Income Tax Act. In the said order the Assessing Officer considered the income of Rs.50084646.00 and accordingly levied tax of Rs.38690390.00.

6. Mr Pangam then would submit that petitioner filed an appeal on 22/4/2022 against the assessment order. Mr Pangam would then submit that demand under Sec. 156 of Income Tax was issued for the assessment year 2017-18 for a sum of Rs.78121750.00. The petitioner then filed an application for stay of such demand until the disposal of appeal by the Commissioner of Income Tax.

7. The respondent no.2 refused to consider grant of stay of demand as 20% of the disputed demand was not paid. The petitioner was called upon to pay 20% of the disputed demand. Vide order dtd. 2/12/2022 respondent no.1 rejected the petitioner's appeal on the sole ground that the petitioner failed to deposit 20% of the disputed demand. The amount of 20% of the disputed demand works out to Rs.15624350.00. Vide letter dtd. 5/12/2022 the petitioner was directed to pay 20% of the disputed demand on or before 13/12/2022 failing which, recovery proceedings would be initiated as per the Income Tax Act. The petitioner, being aggrieved by such orders passed by the respondents, filed present petition with the prayer clauses as set out below:

'A. For a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction thereby quashing and setting aside the Impugned Order dtd. 2/12/2022 passed by the Respondent No.1 bearing reference No.Stay/Pr.CIT/PNJ/2022-23 and the consequential Demand letter dtd. 05/12/2022, issued by the Respondent No.2 bearing letter No.ITBA/RCV/F/17/2022-23/1047808787(1).

B. For an order staying the demand for the sum of Rs.7,81,21,752.00. C. That pending hearing and final disposal of this writ Petition, this Hon'ble Court may be pleased to stay the effect and operation of the Impugned Order dtd. 01/12/2022 passed by the Respondent No.1 bearing reference No.Stay/Pr.CIT/PNJ/2022-23 as well as the consequential demand letter dtd. 05/12/2022, issued by the Respondent No.2 bearing letter No.ITBA/RCV/F/17/2022-23/1047808786(1). D. Ex-parte ad interim relief in terms of prayer clause

(B). E. In the alternate, for an order remanding the matter to the Respondent No.1 for fresh consideration of the Petitioners communication dtd. 14/07/2022. For such other and further reliefs that this Hon'ble Court may deem fit and proper.'

8. Shri Pangam then submitted that the bank deposits of the petitioner were wrongfully considered by the Assessing Office