Interim stay deposit conditions require reasoned consideration and credit for amounts already recovered before fixation.

An interim stay condition requiring payment of 20% of the disputed demand was not struck down as arbitrary, since such a deposit requirement was consistent with Section 55(4) of the Kerala Value Added Tax Act, 2003. However, the orders were faulted for not showing reasons or application of mind to the appellants' contentions, and fairness required that any amount already recovered towards the disputed liability be credited before fixing stay terms. The stay applications were therefore remitted to the Appellate Authority for fresh consideration, and the interim orders were set aside to that extent.

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Issues: Whether the interim stay condition requiring payment of 20% of the disputed demand was imposed mechanically, and whether amounts already recovered towards the disputed liability had to be given credit while fixing such condition.

Analysis: The impugned interim orders did not disclose reasons for imposing the 20% condition or any application of mind to the contentions raised in the appeals. Though the requirement of a 20% deposit was not found to be arbitrary in view of Section 55(4) of the Kerala Value Added Tax Act, 2003, fairness required that any amount already realised out of the disputed liability be taken into account before finalising the interim stay terms. The appropriate course was therefore to remit the stay applications for fresh consideration by the Appellate Authority.

Conclusion: The interim orders were set aside to the extent of remand, and the Appellate Authority was directed to reconsider the stay applications afresh after giving credit for amounts already recovered.

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