Sec. 220, 254(1) of Income Tax Act, 1961— Recovery- Prima facie assessee has an arguable case in appeal, it was deemed to be fit and proper to grant a stay on collection/ recovery of the outstanding demands.

Facts: By way of this petition, assessee seeks vacation of coercive measures against recovery in respect of the remaining demands for interest and penalty for being assessee in default, in respect of the asst. yr. 2010-11. Out of total demand of Rs 6,47,75,090, the assessee applicant has already paid Rs 3,56,69,430, which is little more than the tax component of Rs 3,48,13,919, and the balance outstanding demand represent interest and penalty only. The assessee applicant seeks vacation of garnishee proceedings initiated against the assessee.

Held, that in view of the attachment of assessee’s bank accounts and assessee’s debtors, the assessee is stated to be not in a position to perform these obligations. Prima facie assessee has an arguable case in appeal. Fact that assessee has already paid his entire tax liability, and in case the assessee is to opt for Vivad se Vishwas Scheme, he will have nothing further to pay. In these circumstances, the legitimate interests of the revenue cannot be prejudiced by our grant of stay on the remaining outstanding dues which are primarily on account of levy of interest, and consequential levies. In view of the above discussions, as also bearing in mind entirety of the case, we deem it fit and proper to grant a stay on collection/ recovery of the outstanding demands of Rs. 2,91,05,660 till the disposal of appeal or till the end of six months from the date of this order- whichever is earlier. - PANDHES INFRACON PVT LTD V/s ASSTT. CIT - [2020] 205 TTJ 478 (ITAT-MUMBAI)