High Court Kerala directs Income Tax Commissioner to consider appeals without pre-payment for stay.

The High Court of Kerala allowed the writ appeals, setting aside the single Judge's judgments and directing the Commissioner of Income Tax (Appeals) to promptly consider and dispose of the statutory appeals filed by the appellants. The Court held that the insistence on payment of a portion of the disputed tax amount as a condition for granting a stay was not necessary in this case, keeping the recovery and collection of the tax assessed in abeyance pending the appeal's disposal.

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Issues:
Challenge against interim order for payment of disputed tax amount pending appeal.

Analysis:
The High Court of Kerala considered writ appeals challenging an interim order by the Commissioner of Income Tax (Appeals) requiring payment of 20% of the disputed tax amount pending appeal. The learned single Judge had reduced the payment condition to 10% in the original judgment being challenged by the appeals.

The appellants argued that the liability of the banks to pay income tax had been previously decided by a Full Bench of the Court in a specific judgment. They contended that the appellate authority could only remand the matter for a fresh inquiry into the banks' activities. They claimed that insisting on payment during the appeal process could cause hardships and prejudices to the banks.

On the other hand, the respondent's counsel argued that the part payment condition for granting a stay was within the discretion of the appellate authority, and the Court should not interfere with this exercise of discretion.

The Court, after considering the peculiar aspects of the case in light of the Full Bench decision, concluded that the insistence on payment of a portion as a condition for granting a stay was not necessary in the present cases. Therefore, the impugned judgments were to be modified.

Consequently, the writ appeals were allowed, the single Judge's judgments were set aside, and the Commissioner of Income Tax (Appeals) was directed to consider and dispose of the statutory appeals filed by the appellants promptly. The recovery and collection of the tax assessed were to be kept in abeyance pending the disposal of such appeals.

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