MANNA TRUST vs. INCOME TAX OFFICER

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CW/3845/2020HC Rajasthan2026:RJ-JD:4417-DB23 January 2026Author: ARUN MONGA, YOGENDRA KUMAR PUROHIT2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, without commenting on the merits of the case, disposed of the writ petition. The court took into account that interim protection had been in favour of the petitioner since 2020 and that the appeal had remained undecided for over five years. Consequently, the court directed the first Appellate Authority to decide the pending appeal within three months from the date of receiving a certified copy of the order. The interim protection granted to the petitioner was extended to continue until the appeal was heard and finally decided. The operative direction was to expedite the appeal process and maintain the status quo regarding recovery until the appeal's disposal.

What were the facts?

The petitioner, Manna Trust, is challenging two orders: one dated 18.02.2020, which disposed of their stay application in a pending appeal subject to a 20% deposit of the disputed tax demand, and another dated 07.03.2020, which initiated recovery proceedings under Section 226(3) of the Income Tax Act, 1961, during the pendency of the appeal. The assessment order leading to the demand was dated 27.12.2019. The petitioner filed the present writ petition seeking to quash these orders. The High Court had previously granted interim protection to the petitioner on 07.05.2020, restraining the recovery of the impugned demand. Despite the appeal being pending since March 2020, it had not been heard.

What were the issues?

1. Whether the High Court should quash the order dated 18.02.2020, which disposed of the stay application by requiring a 20% deposit of the disputed tax demand, considering the pendency of the appeal? (Question of law and fact, concerning principles of stay and recovery during appeal). 2. Whether the High Court should quash the order dated 07.03.2020, which initiated recovery proceedings under Section 226(3) of the Income Tax Act, 1961, while the appeal was pending? (Question of law and fact, concerning recovery powers during appeal). Assessee's Contentions: The petitioner sought to quash the impugned orders, implying they were aggrieved by the conditions imposed for stay and the initiation of recovery proceedings during the pendency of their appeal. The petitioner relied on the fact that their appeal had been pending since March 2020 and that interim protection had been granted since May 2020. Revenue's Contentions: The judgment records no specific contentions made by the revenue.

Which sections of the Income-tax Act were involved?

Section 226(3)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
[2026:RJ-JD:4417-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 3845/2020 Manna Trust, Having Its Address At G-5, Shree Ganpati Apartment, New Bhupalpura, Udaipur 313001 Through Its Authorized Signatory Vijay Khandal ----Petitioner Versus 1. Income Tax Officer, Exemption Ward, Udaipur Having Its Office At Aaykar Bhawan, Subcity Centre, Savina, Udaipur 313001. 2. Commissioenr Of Income Tax, Exemption, Jaipur Through Its Office At Kailash Height, Lal Kothi, Tonk Road, Jaipur 302015. 3. Central Board Of Direct Taxes, Having Its Address At North Block, New Delhi Through Its Chairman. ----Respondents For Petitioner(s) : Mr. Harshvardhan Singh Chundawat For Respondent(s) : Mr. K.K. Bissa HON'BLE MR. JUSTICE ARUN MONGA HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT

Order 23/01/2026

1.

Petitioner herein, inter alia, seeks quashing of an order dated 18.02.2020 (Annexure-7) vide which the stay application filed by the assessee in a pending appeal assailing disputed tax demand was disposed of subject to deposit of 20% of the tax demand. Further, he seeks quashing of another order dated 07.03.2020 vide which an attachment under Section 226 (3) of the Income Tax Act, 1961 was passed to cause recovery of tax during pendency of appeal.

2.

Heard and perused the case file. (Uploaded on 29/01/2026 at 05:11:49 PM) (Downloaded on 28/10/2026 at 12:43:48 AM)

[2026:RJ-JD:4417-DB] (2 of 2) [CW-3845/2020]

3.

While issuing notice of instant petition on 07.05.2020, the respondents were restrained from recovering the outstanding impugned demand on the basis of assessment order dated 27.12.2019. In the meanwhile, inspite of the appeal being pending since March 2020 same has not been heard.

4.

Without commenting upon merits of the case, taking into account that there is interim protection in favour of the petitioner since 2020 and; for more than last five years, the appeal has not been decided, the petition is disposed of with direction to the first Appellate Authority to decide the appeal within three months from the date of receipt of certified copy of this order. The interim protection shall continue till the appeal is heard and finally decided. (YOGENDRA KUMAR PUROHIT),J (ARUN MONGA),J 46-Devanshi/- Powered by TCPDF (www.tcpdf.org) (Uploaded on 29/01/2026 at 05:11:49 PM) (Downloaded on 28/10/2026 at 12:43:48 AM)

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