Statutory payment condition for Chapter XX appeals bars admission where the mandatory tax payment requirement remains unpaid.

Whether an appeal under Chapter XX is maintainable turns on the statutory payment condition that income-tax due on returned income must be paid before admission; the tribunal applied this mandatory requirement and concluded that, absent payment and absent applicability of the proviso exception, no discretion exists to admit the appeal. The reasoning relied on the mandatory wording of the payment condition and the record of search-related assessment proceedings; consequence: the appeal was held not maintainable and dismissed for non-compliance with the payment requirement.

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Issues: Whether the appeal filed under Chapter XX is maintainable where the assessee has not paid the income-tax due on the income returned by him as required by Section 249(4) of the Income-tax Act, 1961.

Analysis: Section 249(4) of the Income-tax Act, 1961 mandates that an appeal under Chapter XX shall not be admitted unless the appellant has paid the income-tax due on the income returned by him, with limited exception provided by the proviso to section 249(4)(b). The facts show a search and seizure under the relevant provisions leading to assessment proceedings and that the assessee had admitted tax liability but had not paid the tax due up to the date of hearing before the Appellate Tribunal. The appellate authorities applied the statutory bar on admission of appeals in absence of payment of the tax due and relied upon the recorded satisfaction note initiating proceedings under Section 153C of the Income-tax Act, 1961. No discretionary power is available to admit the appeal where the statutory payment condition remains unfulfilled, except as expressly provided by the proviso to section 249(4).

Conclusion: The appeal is not maintainable for non-compliance with the mandatory payment requirement of Section 249(4) of the Income-tax Act, 1961 and is dismissed.

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