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Issues: (i) Whether the condition requiring payment of 20% of the disputed tax for grant of stay of recovery should be modified when 15% had already been deposited; (ii) Whether coercive recovery and freezing of the assessee's bank account should continue pending disposal of the appeal.
Issue (i): Whether the condition requiring payment of 20% of the disputed tax for grant of stay of recovery should be modified when 15% had already been deposited.
Analysis: The assessee had already deposited 15% of the disputed tax. In the circumstances, the Court found the insistence on further payment up to 20% to be onerous and accepted the modification sought. The stay condition was therefore aligned with the amount already deposited.
Conclusion: The condition was modified from 20% to 15%, and the assessee was treated as having satisfied that requirement.
Issue (ii): Whether coercive recovery and freezing of the assessee's bank account should continue pending disposal of the appeal.
Analysis: Since the appeal was pending and the revised pre-deposit condition stood satisfied, continued coercive steps were not warranted. The freezing of the bank account was also found unsustainable in the circumstances and was directed to be lifted.
Conclusion: Coercive recovery was restrained until disposal of the appeal, and the bank account freeze was annulled with directions for de-freezing.
Final Conclusion: The assessee obtained partial relief by securing modification of the stay condition and protection from recovery action pending appeal.
Ratio Decidendi: Where the assessee has already complied with a substantial pre-deposit condition, the recovery condition may be moderated and coercive measures kept in abeyance pending appellate disposal.
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