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Issues involved: Appeal against judgment and order passed by Writ Court regarding stay of demand under section 220(6) of the IT Act.
The judgment pertains to a letters patent appeal filed against the decision of the Writ Court in OWP No. 338 of 2009, where it was held that the writ jurisdiction could not be invoked as the appellant had an appeal pending before the CIT(A) and had also applied for stay of demand under section 220(6) of the IT Act. The appellant, an assessee under the IT Act, had filed a return which was reassessed by the IT authorities. The appellant then approached the CIT(A) for appeal and also applied for stay of the assessment order under section 220(6) of the Act. The assessing authority, without granting the stay order as requested, directed the appellant to pay 50% of the demand pending disposal of the appeal. Dissatisfied with this decision, the appellant initiated writ proceedings through OWP No. 338 of 2009. The Writ Court, after considering the circumstances, concluded that since the appellant had already appealed before the appellate authority and was granted interim relief, the writ jurisdiction was not warranted, leading to the dismissal of the writ petition and subsequent appeal. The High Court analyzed section 220(6) of the IT Act, emphasizing the discretionary power of the assessing authority to pass orders until the appeal is disposed of. It was determined that the discretion exercised by the assessing authority was in accordance with established legal principles, equity, and justice, not being arbitrary or fanciful. The Court highlighted that interference with discretionary power by the High Court is only permissible if the order violates fundamental principles of justice or fairness. In this case, the refusal to grant the stay order was found not to infringe any legal or fundamental rights enforceable under Article 226 of the Constitution of India. Ultimately, the appeal was dismissed as it was deemed to lack merit, with no costs imposed.
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