MIS. PENNAR INDUSTRIES LTD v. STATE OF A.P & Ors.

Interim order- Demand - Pre-deposit of 50% of disputed tax as condition to grant stay - Held: While granting stay, c pending disposal of the matters, though discretion is available, same has to be exercised judicially - Petitions for stay should not be disposed of in a routine manner - Forum! authority should not pass an order which cannot be sustained on the touchstone of fairness, legality and public interest - D Where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizens' faith in the impartiality of public administration, interim relief can be given - On facts, appellant deposited Rs. 60 lacs as directed by Supreme Court - Writ petition was heard and judgment was E reserved - In the peculiar circumstances of the case till the disposal of the writ petition, there shall not be any further deposit -Tax/Taxation - Andhra Pradesh Tax on Entry of Goods into Local Areas Act, 2001. The appellant has challenged the order of High Court F directing payment of 50% of the disputed tax as condition for grant of interim stay. Disposing of the appeal, the Court HELD: 1. While granting stay pending disposal of the matters, though discretion is available, the same has to be exercised judicially. It is true that on merely establishing a prima facie case, interim order of 1137 G H 1138 SUPREME COURT REPORTS [2009] 1 S.C.R. A protection should not be passed. But if on a cursory glance it appears that the demand raised has no leg to stand, it would be undesirable to require the assessee to pay full or substantive part of the demand. Petitions for stay should not be disposed of in a routine matter B unmindful of the consequences flowing from the order requiring the assessee to deposit full or part of the demand. There can be no rule of universal application in such matters and the order has to be passed keeping in view the factual scenario involved. The forum/authority c should not pass an order which cannot be sustained on the touchstone of fairness, legality and public interest. Where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizens' faith in the impartiality of public administration, interim relief can be given. [Paras 5 and 7) [1140-B; 1140-D-G) 0