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September 2025

Recovery of tax — Stay of demand pending appeal before CIT(A) — Condition requiring 20 per cent., deposit of outstanding demand is contrary to law — Instruction issued by CBDT misconceived — Non-consideration of prima facie merits and undue hardship — Mechanical approach rejecting stay application solely due to non-deposit of 20 per cent amount is contrary to law — Order of conditional stay set aside — Matter remanded.

By Keshav Bhujle | Ritu Punjabi, Advocates
Reading Time 2 mins

32. (2025) 475 ITR 96 (Del):

Centre For Policy Research vs. CIT:

A. Y. 2022-23: Date of order 09/05/2024:

Ss. 156 and 220(6) of ITA 1961

Recovery of tax — Stay of demand pending appeal before CIT(A) — Condition requiring 20 per cent., deposit of outstanding demand is contrary to law — Instruction issued by CBDT misconceived — Non-consideration of prima facie merits and undue hardship — Mechanical approach rejecting stay application solely due to non-deposit of 20 per cent amount is contrary to law — Order of conditional stay set aside — Matter remanded.

The assessee was registered as a charitable trust u/s. 12A r.w.s. 12AA and 12AB(4) of the Income-tax Act, 1961. The assessee’s registration was cancelled with retrospective effect, which formed the subject matter of a separate writ petition wherein interim orders were passed. Following this cancellation, an assessment order was passed for the A. Y. 2022-23. The assessee filed appeal before the Commissioner (Appeals) u/s. 246A of the Act. The assessee also applied for stay of the demand u/s. 220(6) of the Act, during the pendency of the Appeal. The Assessing Officer passed an order requiring the assessee to deposit

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