Instakart Services Private Limited Vs PCIT (Central) (Karnataka High Court)
The Karnataka High Court considered a writ petition challenging orders rejecting the petitioner’s request for stay of tax demand for Assessment Year 2018-19 and seeking protection from recovery during the pendency of appeals. The petitioner contended that the authorities had incorrectly treated the requirement of depositing 20% of the disputed demand as a mandatory pre-condition for grant of stay by relying on the Circular dated 29.02.2016. The petitioner relied on an earlier decision of the High Court, arguing that in similar circumstances the Court had held that the requirement of deposit was not mandatory and had granted an unconditional stay while directing expeditious disposal of pending appeals. It was also argued that the review petition had been rejected by a cryptic and non-speaking order without proper application of mind. The Revenue supported the impugned orders and sought dismissal of the petition. After considering the submissions, the Court examined its earlier judgment and noted that the Circular dated 29.02.2016 only partially modified the earlier Circular No. 1914. The earlier circular continued to require authorities to consider whether the assessment was unreasonably high-pitched or whether insisting on deposit would cause genuine hardship to the assessee. The Court observed that the prescribed percentage was not mandatory in every case and depended upon the facts and circumstances.
