The Orissa High Court has granted interim relief to Tata Play Limited by staying recovery of an Entry Tax penalty of ₹18.45 lakh while directing the company to pay the disputed tax and interest component in three installments.
The bench of Justice Savitri Ratho and Justice V. Narasingh has also requested the Odisha Sales Tax Tribunal to dispose of the pending second appeal expeditiously, preferably by the end of August 2026.
The case arose from a writ petition filed by M/s Tata Play Limited (formerly Tata Sky Limited) challenging an order of the Commissioner of Sales Tax rejecting its request for stay of demand during the pendency of a second appeal before the Odisha Sales Tax Tribunal. The dispute relates to proceedings under the Orissa Entry Tax Act, 1999.
Tata Play contended that denial of stay would cause serious prejudice and virtually render the pending second appeal before the Tribunal infructuous. The company argued that coercive recovery during the pendency of the appeal would defeat the purpose of pursuing appellate remedies.
On the other hand, the State authorities opposed the writ petition, arguing that the company did not have a prima facie case and therefore was not entitled to any interim protection. The Revenue relied upon the Commissioner’s order rejecting the stay application and sought dismissal of the writ petition.
The Court examined the demand notice issued under the Orissa Entry Tax Act, 1999, which pertained to the tax period from 1 April 2012 to 31 March 2014. The notice quantified the total demand at ₹66.66 lakh, comprising tax of ₹8.83 lakh, interest of ₹39.57 lakh and penalty of ₹18.45 lakh. The demand had been determined through an order dated 31 August 2021.
While refraining from commenting on the merits of the dispute because the matter was already pending before the Tribunal, the High Court considered the statutory framework under Section 7(5) read with Section 16(4) of the Orissa Entry Tax Act. After evaluating the rival submissions and materials on record, the Bench concluded that the interests of justice would be served by granting conditional protection to the petitioner.
The Court directed Tata Play to pay the tax and interest amounts in three equal installments. The first installment is due on 30 June 2026, the second on 15 July 2026, and the third on 30 July 2026. Before determining the exact installment amounts, the Revenue authorities were directed to consider Tata Play’s claim regarding payments already made towards tax and interest, as reflected in documents annexed to the writ petition.
The High Court ordered that upon such deposits being made, recovery of the penalty amount would remain stayed until the disposal of the second appeal by the Tribunal. This effectively shields the company from immediate recovery proceedings in respect of the penalty component while the appellate challenge remains pending.
Taking note that the second appeal is presently pending before a Single Bench of the Odisha Sales Tax Tribunal, the Court requested the Tribunal to dispose of the appeal as expeditiously as possible, preferably by the end of August 2026. The parties were also directed to cooperate in ensuring timely disposal of the proceedings.
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