Court grants interim stay on tax demand for assessment year 2013-14, directs prompt appeal review.

The Court granted an interim stay on the recovery action regarding a tax demand for the assessment year 2013-14, emphasizing the importance of considering certain factors. It directed the Commissioner of Income Tax (Appeals) - 11 to promptly review the Appeal within eight weeks, prohibiting any recovery action by the respondents until the Appeal's resolution. The Writ Petition was disposed of without costs, and the connected Miscellaneous Petition was closed.

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Issues:
Challenge to order directing remittance of tax demand for assessment year 2013-14 based on Income Tax Act, 1961.

Analysis:
The petitioner, a Tamil Nadu State Marketing Corporation Limited, challenged an order directing remittance of 15% of tax demand for the assessment year 2013-14 under Section 143(3) of the Income Tax Act, 1961. The petitioner filed a Stay Petition elaborating on various facts and referring to earlier successful appeals before the Income Tax Appellate Tribunal for the years 2007-08 and 2008-09. The petitioner sought a stay on the demand and requested the Appeal to be heard by the Commissioner of Income Tax (Appeals) - 11.

The Court granted an interim stay on the recovery action based on similar orders passed in the petitioner's previous cases. The Court highlighted the importance of considering three factors - prima facie case, balance of convenience, and irreparable hardship - while granting interim orders. The Court emphasized that circulars issued by the Central Board of Direct Taxes (CBDT) should only guide the Officer and not restrict their discretion in granting interim orders. It noted the lack of reasons in the impugned order, possibly due to the Officer being bound by CBDT circulars.

Considering the petitioner's success in previous appeals and pending appeals for other years, the Court directed the Commissioner of Income Tax (Appeals) - 11 to expeditiously consider the Appeal for the year 2013-14 within eight weeks. The Court ordered no recovery action to be initiated by the respondents until the Appeal is disposed of. The Writ Petition was disposed of with no costs, and the connected Miscellaneous Petition was closed.

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