The aassessee filed an application for stay of demand , when the appeal was pending before the CIT(A). Revenue rejected the application and directed to pay to the extent of 20% of the total tax demand arising under section 201(1) of the Act . The assessee filed the writ petition against rejection of stay application . The Court held that requirement of 20 percent of disputed tax demand is not a pre-requisite for putting in abeyance recovery of demand pending first appeal in all cases . The said pre -condition of deposit of 20 percent of the demand can be relaxed in appropriate cases . High Court referred PCIT v. LG Electronics India ( P) Ltd ( 2018) 303 CTR 649 / 168 DTR 353 (SC) and set aside the order of recovery . Directed the Commissioner of income tax deal with all contention of the assessee and pass speaking order . ( WP (C) 16287 & 16288 ( Delhi) ( HC) dt . 25 -11-2022) ( AY. 2013 -14 , 2014-15)
Dr. B.L.Kapur Memorial Hospital v .CIT ( 2023 ) BCAJ- January P. 46 ( Delhi)( HC)
S. 201 : Deduction at source – Failure to deduct or pay – Stay of recovery – Pendency of appeal – Tax Authorities can grant stay against recovery of demand on deposit of a lesser than 20 percent of the disputed demand . [S. 220 (6), Art , 226 ]