Stay on interest recovery cannot be withdrawn without review power while waiver request remains pending.

The High Court held that an order vacating a stay on recovery of interest was unsustainable where the petitioners had complied with the instalment conditions, the tax demand had been paid, and the waiver request on interest remained pending before the CBDT. It noted that, in the absence of an express review power under the Income-tax Act, the authority that granted the stay could not withdraw it while the waiver representation was undecided. The vacating order was quashed, the earlier stay orders were revived, and the waiver request was directed to be decided expeditiously.

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Issues: Whether the order vacating the earlier stay of recovery of interest was sustainable when the petitioners had complied with the instalment conditions and the stay application for waiver of interest was still pending before the Central Board of Direct Taxes.

Analysis: The petitioners had been granted instalment facilities and the interest component of the demand had been kept in abeyance pending disposal of the waiver request. The tax portion was stated to have been fully paid in terms of the earlier directions. In the absence of an express power of review in the Income-tax Act, the authority which granted the stay could not validly revisit and withdraw that order, especially when the underlying waiver representation had not yet been decided.

Conclusion: The order vacating the stay was not legally sustainable and was quashed. The earlier stay orders stood revived, and the Central Board of Direct Taxes was directed to decide the waiver representation expeditiously.

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