2014 (11) TMI 62 - HC - Income Tax

Condition for payment of 50% of the demands for granting stay Principle of hardship Winding up proceedings going on - Held that - The assessee is already facing a petition for winding up on the file of the Company Court at the instance of the Bank of New York - the Company Court has already granted an interim order of injunction - Therefore, this is a case where the application of the principle of hardship is warranted revenue also should take note of the fact that whatever is collected now, may safeguard their interests ultimately in view of the pendency of the company petition for winding up the order is modified and the payment to be made is reduced to 20% of total demand Partial stay granted.

Summary

Issues:
Challenge to the imposition of a condition for payment of 50% of demands for stay of assessment orders.

Analysis:
The petitioner challenged the imposition of a condition requiring payment of 50% of the demands for granting a stay of assessment orders. The petitioner was facing a winding-up petition and had obtained an interim injunction. The court considered the principle of hardship and the interests of both parties. The court modified the condition imposed by the third respondent, allowing the petitioner to pay 20% of the total demand within six months in equal monthly installments. The stay granted by the court would be in effect until the disposal of the appeals, with the third respondent instructed to dispose of the appeals by a specified date. The court closed the matter without imposing any costs.

This judgment highlights the court's role in balancing the interests of parties in cases involving financial demands and legal proceedings. The court acknowledged the petitioner's circumstances, including the winding-up petition and the interim injunction obtained. By considering the principle of hardship, the court modified the payment condition to alleviate the burden on the petitioner while safeguarding the interests of the department. The court's decision to allow installment payments over six months demonstrates a practical approach to addressing financial obligations in legal matters.

The court's directive regarding the duration of the stay, linked to the disposal of appeals, provides clarity on the timeline for the resolution of the case. By setting a deadline for the disposal of appeals, the court aims to expedite the legal process and ensure timely resolution. Additionally, the court's decision to close the matter without imposing costs indicates a fair and efficient handling of the case, considering the circumstances and the modifications made to the payment condition. Overall, the judgment reflects a balanced approach to addressing the challenges faced by the petitioner while upholding legal principles and procedural requirements.