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1971 (10) TMI 88 - SC - VAT and Sales TaxWhether the delay in depositing the admitted tax should be condoned? Held that - Appeal allowed. As the appellate authority disposed of the appeal on the short ground that it was barred by time and that it had no jurisdiction to extend the period of limitation this matter will have to go back for reconsideration and re-decision of that authority. In the result the appeal is allowed and the judgment of the High Court is set aside. The case is remitted to the High Court for making appropriate directions for reconsideration and rehearing of the appeal by the appellate authority under the Act. The assessee will be entitled to costs in this court.
Issues:
- Interpretation of section 9 of the U.P. Sales Tax Act, 1948 regarding the time limit for filing an appeal and depositing the admitted tax amount. - Applicability of section 5 of the Indian Limitation Act to appeals under the Act. - Consideration of the judgment of the Allahabad High Court in Janta Cycle and Motor Mart v. Assistant Commissioner (J.) III, Sales Tax, Kanpur Range [1968] 22 S.T.C. 94. - Comparison with the decision in Lakshmiratan Engineering Works Ltd. v. Assistant Commissioner (J.) I, Sales Tax, Kanpur [1968] 21 S.T.C. 154 (S.C.). - Analysis of the decision in Gangadharan Pillai v. Sales Tax Officer (Reserve), Ernakulam [1965] 16 S.T.C. 578. - Examination of the decision in Raja of Venkatagiri v. Commissioner of Income-tax [1955] 28 I.T.R. 189. Detailed Analysis: The judgment of the Supreme Court pertains to an appeal challenging an order of the Allahabad High Court concerning the interpretation of section 9 of the U.P. Sales Tax Act, 1948. The main issue revolved around the time limit for filing an appeal and depositing the admitted tax amount. The appellant, a Hindu undivided family engaged in the business of manufacturing oils, had filed an appeal after the expiry of the period of limitation prescribed for filing the appeal. The Assistant Commissioner rejected the appeal as defective due to a delay in depositing the tax amount admitted to be due. The Allahabad High Court had dismissed the petition challenging the Assistant Commissioner's order, emphasizing that the delay in making the necessary deposit of the admitted tax could not be condoned under section 5 of the Limitation Act. The Full Bench of the High Court, in the case of Janta Cycle and Motor Mart, had interpreted the provisions of section 9, concluding that the delay in depositing the admitted tax could not be condoned under section 5 of the Limitation Act. However, the Supreme Court disagreed with the reasoning of the High Court. The Court clarified that the appeal would be deemed properly filed on the date the admitted tax amount is paid, even if it is beyond the initial 30-day period. It emphasized that section 9(6) would then apply, allowing the appellant to seek condonation of delay under that provision. The Court cited the decision in Gangadharan Pillai v. Sales Tax Officer, Ernakulam, supporting the view that the appeal should be treated as filed when the tax amount is paid. Furthermore, the Court referred to the decision in Raja of Venkatagiri v. Commissioner of Income-tax, highlighting that the delay in filing an appeal could be condoned under the relevant provision, even if the tax payment was a condition precedent to the maintainability of the appeal. The Supreme Court criticized the High Court's reliance on Lakshmiratan Engineering Works Ltd. case, emphasizing that the word "entertain" in section 9(1) did not impact the consideration of the appeal's timeliness. In conclusion, the Supreme Court allowed the appeal, set aside the High Court's judgment, and remitted the case for reconsideration by the appellate authority under the Act. The Court clarified that the appellate authority had the jurisdiction to extend the time for filing the appeal if sufficient cause for the delay was established, regardless of the timing of the tax payment.
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