Petition Denied: Deposit of 20% of Outstanding Tax Demand Upheld

The court upheld the decision rejecting the stay of demand by the Income Tax Officer, requiring the petitioner to deposit 20% of the outstanding demand pending appeal before the Commissioner of Income Tax (Appeals). The court found that the petitioner failed to demonstrate genuine hardship in meeting the deposit condition. As a result, the petition was dismissed, and the pending application was disposed of without costs awarded.

---

---

Issues:
Challenge to rejection of stay of demand by Income Tax Officer and requirement to deposit 20% of outstanding demand pending appeal before CIT(A).

Analysis:
The petitioner challenged the order rejecting the stay of demand of Rs. 5,00,04,435/- by the Income Tax Officer and the requirement to deposit 20% of the outstanding demand as a condition for stay. The appeal against the assessment order was pending before the Commissioner of Income Tax (Appeals). The Additional Commissioner Income Tax, in the order dated 18th February, 2019, mandated the petitioner to deposit Rs. 1 crore, being 20% of the outstanding demand, citing relevant instructions. The court noted that the petitioner failed to demonstrate genuine hardship in meeting the deposit condition.

The petitioner sought reliance on previous judgments highlighting that the Assessing Officer's discretion could be interfered with only in exceptional circumstances, such as unreasonably high-pitched assessment or genuine hardship to the assessee. The court emphasized that the determination of what constitutes "unreasonably high-pitched" assessment varies case by case. In this case, the petitioner needed to establish genuine hardship in complying with the deposit requirement resulting from the assessment. However, the petitioner failed to show such hardship, and the question of the assessment being unreasonably high-pitched would be addressed in the pending appeal before the CIT(A).

As the petitioner did not prove genuine hardship for the stay of demand, the court found no reason to interfere with the impugned order. Consequently, the petition was dismissed, and the pending application was disposed of without any costs being awarded.

---