ITR
Stay of demand while an appeal is pending
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Facts
Filing an appeal does not stop the demand by itself. You can ask the officer for a stay, which is usually granted on a part payment of the demand. Check the latest CBDT instruction for the standard percentage.
Provisions and law
- Sec 156, Income-tax Act 1961 (now Sec 289, Income-tax Act 2025)Demand notice issued with the order.
- Sec 220, Income-tax Act 1961Taxpayer in default if demand is not paid in time.
- Sec 246A, Income-tax Act 1961 (now Sec 357, Income-tax Act 2025)Appeal to the Commissioner (Appeals).
Analysis
Apply for stay giving your appeal details and reasons, such as a strong case on merits or financial hardship. Pay any part payment the officer requires. Without a stay, refunds of other years may be adjusted against this demand. Respond to the demand on the portal as disagreed with appeal filed.
Conclusion
- File the appeal first.
- Apply for stay with the appeal acknowledgement.
- Pay any part payment required.
- Mark the demand as disputed on the portal.
A Savvy can do this for you
Scrutiny assessment, Sec 143(2) (now 270(8))
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