Interim stay in tax appeal modified after balancing prima facie case, hardship, and revenue protection.

Interim relief in a tax appeal was reconsidered on the basis of the assessee's prima facie case and the hardship caused by a higher pre-deposit. The HC applied the settled approach to balancing revenue protection against pending appeal rights and modified the earlier stay arrangement. It reduced the deposit requirement to 10% of the demanded tax, kept the remaining demand in abeyance until disposal of the first appeal, and required security for the stayed amount. Expeditious disposal of the appeal was also directed.

---

---

Issues: Whether the interim order in appeal needed modification by reducing the pre-deposit requirement and continuing stay of the balance demand till disposal of the appeal.

Analysis: The revision challenged the Tribunal's order granting stay of 80% of the disputed tax and sought complete stay. The Court considered that the appellate authority had already granted partial protection, but found that the demand should be balanced against the assessee's prima facie case and the hardship caused by insisting on a larger deposit. Applying the settled approach for interim relief in tax matters, the Court held that a further modification was justified. It also directed expeditious disposal of the first appeal.

Conclusion: The order was modified to require deposit of 10% of the total demanded tax within one month, with 90% of the demand kept in abeyance till disposal of the appeal, subject to furnishing security of the stayed amount. The revision was partly allowed in favour of the assessee.

---