Interim stay in tax appeal requires prima facie merits and hardship review, not rejection based only on pre-deposit.

A stay application in a tax appeal must be decided on settled interim-relief parameters, including prima facie merits and hardship, and cannot be rejected merely because the statutory pre-deposit has been made. The order under challenge was found unsustainable because it treated the deposit as showing economic soundness without properly examining the applicant's prima facie case or the hardship caused by denial of interim protection. The HC set aside the rejection of stay, granted interim protection against coercive recovery, and directed expeditious disposal of the appeal.

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Issues: Whether the order rejecting the stay application could be sustained when it was passed without proper consideration of the prima facie case and the hardship caused to the applicant.

Analysis: The challenge related to the refusal of interim protection in a tax appeal after the applicant had already made the mandatory pre-deposit. The order under challenge was found to proceed on the assumption that the deposit itself showed economic soundness, without properly examining the applicant's prima facie case or the relevant hardship factors. A stay application is expected to be decided on settled parameters governing interim relief, and not in a routine or cursory manner merely because the statutory deposit has been made.

Conclusion: The rejection of the stay application was unsustainable and was set aside.

Final Conclusion: The revision succeeded, the impugned stay order was annulled, and the appeal was directed to be decided expeditiously with interim protection against coercive recovery.

Ratio Decidendi: A stay application in a tax appeal must be decided on the basis of prima facie merits and hardship, and cannot be rejected merely because the required pre-deposit has been made.

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