Facts of the Case
Order passed by the Assessing Officer under section 143(3) of the Income-tax Act, 1961 is pending consideration before the Commissioner of Income-tax (Appeal).
Assessing officer can recover only 20% of the Disputed amount till disposal of appeal by CIT (appeals) . But AO already recovered 86.43% of the total outstanding demand.
Decision of High Court
Assessing Officer shall normally grant stay of demand till disposal of the first appeal on payment of 20% of the disputed demand. In the event, the Assessing Officer is of the view that the payment of a lump sum amount higher than 20% is warranted, then the Assessing Officer will have to give reason
There is no order by the Assessing Officer giving any special/particular reason as to why any amount in excess of 20% of the outstanding demand should be recovered from the petitioner-assessee
The respondents are entitled to seek pre-deposit of only 20% of the disputed demand during the pendency of the appeals
Accordingly, the respondent No. 1 is directed to refund the amount adjusted in excess of 20% of the disputed demand