High Court quashes stay order, mandates fresh hearing for petitioner. Emphasizes independent discretion for quasi-judicial authorities.

The High Court quashed the stay order issued by the first appellate authority, directing a fresh hearing for the petitioner in compliance with the Court's directions. The Court emphasized the need for quasi-judicial authorities to exercise independent discretion without being influenced by external directives, particularly when directed by the Court to consider matters on their merits. The first appellate authority was instructed to issue new orders within four months, suspending recovery actions during this period, and the petitioner was required to provide necessary documents to the authority for further action.

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Issues:
1. Validity of Ext.P6 stay order passed by the first appellate authority in a stay application filed along with an appeal against the order of assessment under the Income Tax Act.
2. Consideration of stay application by the appellate authority in compliance with the directions of the Court.
3. Reliance on office memoranda issued by the CBDT by the appellate authority.
4. Denial of opportunity of hearing to the petitioner before passing the stay order.

Analysis:
The petitioner challenged Ext.P6 stay order passed by the first appellate authority, contending that the authority relied on CBDT instructions, demanding 20% of the disputed demand as a condition for granting stay, contrary to the directions of the Court and without providing an opportunity of hearing. The High Court observed that the appellate authority acted under dictation by following CBDT instructions, which was improper as quasi-judicial authorities should exercise discretion independently. The Court emphasized that statutory authorities must adjudicate issues without being influenced by external directives, especially when directed by the Court to consider matters on merits. The Court agreed with the petitioner's argument that the appellate authority's failure to hear him before passing the stay order violated the Court's directions from a previous judgment.

The High Court, after considering the submissions and circumstances, quashed the Ext.P6 order and directed the first appellate authority to pass fresh orders after hearing the petitioner either physically or through video conference. The Court emphasized that the authority should not be influenced by external instructions and must act independently as mandated by the statutory scheme. The High Court instructed the 2nd respondent to issue fresh orders within four months, during which recovery steps for the disputed amounts should be suspended. The petitioner was directed to provide a copy of the writ petition and the judgment to the 2nd respondent for further action in compliance with the Court's directions.

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