Dept shall exercise Power to Grant Stay Order Judiciously by Balancing Convenience and Irreparable Injury: Delhi HC [Read Order]

The Delhi High Court consisting of Justice Manmohan and Justice Dinesh Kumar Sharma has held that the income tax department shall exercise the power to grant a stay order judicially by considering the balance of convenience and irreparable injury.

The assessee, Seven Seas Hospitality Private Limited has challenged the order rejecting stay applications contending that the same are non-reasoned orders inasmuch as the department has not considered the submissions of the Petitioner.

The Court observed that “the discretion vested in the department has not been exercised judiciously. Further, neither the Assessing Officer nor the PCIT has considered the three basic principles i.e. the prima facie case, balance of convenience and irreparable injury while deciding the stay application.”

Clarifying that no coercive action shall be taken against the assessee till the disposal of stay applications, the Court quashed the impugned orders and notices and the matter is remanded back to the PCIT for fresh adjudication on the applications for stay.

“However, before deciding the stay applications, the PCIT shall grant a personal hearing to the authorised representative of the Petitioner. For this purpose, list the matter before the PCIT on 23rd May, 2022. After grant of personal hearing, the PCIT shall pass a reasoned order in accordance with the law,” the Court said.

To Read the full text of the Order CLICK HERE

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