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VIJAY BISHNOI, YOGENDRA KUMAR PUROHIT
Kunj Bihari Lal Agarwal, S/o. Shri Ram Avtar Agarwal – Appellant
Versus
Principal Commissioner of Income Tax (Central) – Respondent
JUDGMENT :
1. This writ petition under Article 226 of the Constitution of India is filed by the petitioner challenging the order dated 03.03.2023 passed by respondent No.1-PCIT, Jaipur, whereby application filed by the petitioner seeking stay of recovery of demand pertaining to assessment years 2014-15, 2016-17 and 2020-21 has been disposed of in the following manner :
1. The Outstanding aggregate demand of Rs.25,12,77,982/- to be stayed till disposal of 1st appeal only upon payment of 20% of demand as per above schedule.
2. The applicant is directed to make payment as per the above schedule.
3. The assessee shall co-operate in early disposal of the appeal pending before the Ld. CIT(A).
4. Revenue retains the right to reconsider/review the payment plans/ stipulations as well as the stay order anytime in case of any exigency or administrative requirement or to safeguard the interests of revenue.
5. This order does not confer any legal right to the assessee. No finding or adjudication on assessee's pending matters can be inferred from this order. The assessee shall not act in any manner that may cause prejudice to interests
Assessments deemed excessively high must consider genuine hardship, allowing stays without mandatory pre-payment when necessary to protect taxpayer interests.
The court upheld the authority's decision to grant a stay subject to a 10% deposit, emphasizing the need for procedural propriety in stay applications.
Authorities must provide reasoned decisions when rejecting stay applications and consider claims of financial hardship, ensuring compliance with principles of natural justice.
Assessment orders must provide adequate reasoning and consider potential hardship; failure renders them unsustainable, necessitating reevaluation by tax authorities.
The court emphasized that the revenue authorities have the discretion to grant deposit orders of a lesser amount than 20% pending appeal, and the circulars issued by the department cannot overwrite t....
Power to consider prayer for stay is incidental and ancillary to the power to hear appeals.
The court ruled that a petitioner must demonstrate a prima facie case and financial incapacity to obtain a stay on tax demand, which was not established in this case.
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