' The appellant through this appeal has objected against the impugned order of the learned CIR(A) dated 14-6-2011, deciding the miscellaneous application for stay of tax demand arising out of the order of the Taxation Officer/ACIR under section 122(5A) of the Income Tax Ordinance, 2001. The following grounds have been framed by the appellant: "(2) That the learned Commissioner Inland Revenue (Appeals-I) has erred in law and on facts in passing Impugned Order without considering the merits of the case for grant of stay.
(3) That the learned Commissioner Inland Revenue (Appeals-I) has erred in law and on facts in passing Impugned Order without considering the perquisites for grant of stay.
(4) That the learned Commissioner Inland. Revenue (Appeals-I) has erred in law and on facts in passing conditional order in respect of Stay of demand._
(5) That the appellant, therefore, prays that relief claimed before the learned Commissioner Inland Revenue (Appeals-I), Karachi for stay of demand of entire demand, may please be allowed.
2. Mr. Arshad Siraj, Advocate, appeared on behalf of the appellant and has contended that the learned CIR(A) has allowed the stay application but has directed to pay 50% of the outstanding demand which is not justifiable keeping in view the facts and circumstances of the case. In this regard, he has contended that the Additional Commissioner in this respect while passing the order under section 122(5A) has seriously erred A in law and on facts in misinterpreting the proviso to subsection (1) of section 113 and computing the minimum tax at 0.5% at Rs,543,440,205 which action is ab initio void, illegal as no notice under section 122(9) read with section 122(5A) of the Ordinance was issued to the appellant deviating from the computation made in the show-cause notice dated 25-4-2011. The learned counsel in this regard has also placed the copy of profit and loss account showing gross loss at Note No, 38 being at Rs,10,925,814 and the depreciation as mentioned at note 4.1.6 has been declared at Rs,3,757,325 while the Taxation Officer in his computation has taken the figure of the depreciation at Rs,13,012,467,847. The learned counsel in this regard has also referred to the decision of the Hon'ble Supreme Court of Pakistan reported as PLD 2003 Supreme Court 344, wherein it has been held regarding the temporary injunction that: "it is the bounden duty of the court to examine balance of convenience, irreparable loss as well as behavior and conduct of the parties". He has also referred to another case of the honourable High Court of Sindh at Karachi reported as 2006 PTD 670 wherein it is held that "any order which does not contain any reason and does not show that it is passed on objective consideration shall always be treated as arbitrary, which have no room in any system of law, because it is result of misuse of the authority vested in the public functionary".
Learned counsel in this regard has contended that in the instant case the learned CIR(A) without giving any reason has restricted the stay allowed with the condition to payment of 50% of outstanding demand without mentioning any reason. In an another case of the Hon'ble High Court reported as 1992 CLC 2540 wherein it has been held that: "in order to determine whether or not a prima facie case exists for grant or confirmation of the temporary injunction, it is necessary to highlight first the essential facts and then make reference to the state at law on the subject.
Needless to add that prima facie case, as understood by law, does not imply an indefeasible case.
It signifies only an arguable matter, involving serious or substantial questions of fact and law, which on proceedings to trial is capable of and has a possibility of success." In another decision reported as 1996 CLC 507 Karachi High Court, it is held that: "for the grant of interim relief it is never necessary for a court to record a positive finding in favour of either party on balance, the party claiming relief is only to be shown to have made out a prima facie case which in turn means an arguable and not an indefeasible case if that is so, the next questions to be considered are those of balance of convenience and irreparable loss, where the relief claimed is that of an interim injunction."
' In view of these augments, the learned counsel has requested that there was no justification for invoking condition of payment of 50% of the tax demand. He has, therefore, requested for cancelling that condition.
' On the other hand, the learned DR is supporting the impugned order of the learned CIR(A). He has contended that the taxpayer/appellant should pay at least 50% of the tax demand which is fair and just, keeping in view the facts and circumstances of the case.
3. We have considered the arguments put forth from both the sides and find force in the contention made by the learned counsel of the appellant that there was no justification to make condition for the payment of 50% of the tax demand without giving any reason in this respect by the learned CIR(A). The Hon'ble Supreme Court in the case referred above has already held that for the grant of interim relief it is necessary for a court to record positive finding in favour of either party and on balance, the party claiming relief is only to be shown to have made out a prima facie case which in turn means an arguable and not an indefeasible case. Likewise the Hon'ble Sindh High Court in the above referred case has held that: "in such like matters besides prima facie case it is bounden duty of the court to examine the balance of convenience, irreparable loss as well as behavior and conduct of the parties." But in this case we have found that the learned CIR(A) has not given any reason for making condition of the payment of 50% of the tax demand for allowing the stay.
' We find no justification for the payment of 50% of the tax demand. The stay in the matter already allowed by the learned CIR(A) till 20-7-2011 is upheld, however, the condition of payment of 50% of the outstanding demand is deleted and the Department is directed not to initiate recovery proceedings regarding subject matter appeal pending before the learned CIR(A) till 20-7-2011.
Consequently, the impugned order of the learned CIT(A) in this respect is amended to the extent of the above mentioned observations.
4. The appeal filed by the taxpayer is allowed to the extent and in the manner referred to above.