Interim protection in tax writ proceedings depends on factual discretion, hardship, and prima facie strength, not mechanical stay rules.

Interim protection in tax writ proceedings must be decided on the facts of each case through judicial discretion, not by a mechanical reference to earlier stay orders. A prima facie case alone does not automatically justify relief, but requiring payment of the full or a substantial part of the demand may be unwarranted where the demand appears unsustainable on a cursory view and further payment would cause grave hardship or public mischief. As the amounts already directed had been deposited and the writ petition had been heard with judgment reserved, no further deposit was required pending disposal.

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Issues: Whether, in the pending writ proceedings arising out of a tax demand, the assessee could be relieved from any further deposit until disposal of the writ petition.

Analysis: The Court reiterated that applications for interim protection must be decided judicially on the facts of each case and not by a mechanical reference to earlier stay decisions. While a prima facie case alone does not automatically justify interim protection, the Court noted that requiring payment of the full or a substantial part of the demand may be unwarranted where the demand appears unsustainable on a cursory view. The Court also emphasised that interim relief may be justified where denial would cause grave private injury or public mischief. Since the amounts already directed to be deposited had in fact been deposited and the writ petition had already been heard with judgment reserved, the Court considered the circumstances sufficient to avoid any further deposit.

Conclusion: The assessee was granted protection against any further deposit until disposal of the writ petition.

Final Conclusion: Interim relief was extended in the tax matter, and the appeal was concluded by removing any additional deposit obligation pending the writ proceedings.

Ratio Decidendi: Interim stay matters in tax cases must be decided on the facts of the case by a judicially exercised discretion, balancing prima facie strength, potential hardship, and public interest rather than by a mechanical formula.

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