Court sets aside 20% deposit order, emphasizes appellate discretion in deposit orders. Administrative circulars not binding. Remanded for fresh decision.

The court set aside the order requiring a 20% deposit of outstanding demand, emphasizing the appellate authority's discretion in granting deposit orders. The court clarified that administrative circulars are not binding on the authority, which must independently assess each case. The matter was remanded for a fresh decision, ensuring compliance with natural justice principles. The judgment disposed of the writ petition without costs and directed closure of pending applications for a comprehensive resolution.

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Issues:
1. Petitioner's grievance against the order for depositing 20% of outstanding demand.
2. Applicability of CBDT office memorandum dated 31.07.2017.
3. Judicial interpretation of administrative circulars.
4. Quasi-judicial powers of the appellate authority.
5. Setting aside the impugned order and remanding the matter for a fresh decision.

Analysis:

Issue 1: The petitioner challenged the order requiring a deposit of 20% of the outstanding demand. The petitioner was aggrieved by the order dated 04.03.2022, where the 1st respondent directed that the petitioner would not be treated as in default if 20% of the outstanding demand was deposited by a specified date. The petitioner, an assessee under the Income Tax Act, was assessed for the year 2017-18, resulting in a substantial increase in the assessed income compared to the returned income.

Issue 2: The impugned order was guided by the CBDT office memorandum dated 31.07.2017, allowing for a stay in cases with pending appeals upon payment of 20% of the disputed demand. The court noted the reliance on this memorandum but emphasized that the authority is not bound by such administrative circulars. The Supreme Court precedent highlighted that the authority can exercise discretion to grant deposit orders for amounts less than 20% during appeals.

Issue 3: The judgment clarified the judicial stance on administrative circulars, emphasizing that the appellate authority, as a quasi-judicial body, must independently assess each case. The Commissioner (Appeals) is not mandated to follow administrative circulars blindly but must apply individual judgment based on the circumstances of each case.

Issue 4: Recognizing the quasi-judicial powers of the appellate authority, the court set aside the impugned order dated 04.03.2022. The matter was remanded back to the 1st respondent for a fresh decision on the stay petition, emphasizing compliance with natural justice principles. The appellate authority was directed to reconsider the petitioner's stay request within four weeks, maintaining the stay on the demand until a fresh decision is made.

Issue 5: The judgment concluded by disposing of the writ petition without imposing any costs. Additionally, any pending miscellaneous applications in the writ petition were directed to be closed as a sequel to the main decision, ensuring a comprehensive resolution of the legal matter.

This detailed analysis encapsulates the key issues addressed in the judgment, providing a comprehensive understanding of the legal reasoning and implications of the court's decision.

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