1994 (8) TMI 290 - HC - VAT and Sales Tax

Summary

Issues:
1. Appeal against ex parte assessment order for additional tax demand.
2. Appeal against order for interest on assessed tax amount.
3. Interpretation of Section 20(5) of the Punjab General Sales Tax Act, 1948 regarding deposit requirements for appeal.
4. Quashing order directing deposit of interest as a condition for appeal.

Analysis:
1. The petitioner, a cement trader registered under the Punjab General Sales Tax Act, 1948, challenged an ex parte assessment order for the assessment year 1982-83, which raised an additional tax demand of Rs. 5,51,822. The petitioner's appeal to the Deputy Excise and Taxation Commissioner and Sales Tax Tribunal was dismissed due to failure to deposit Rs. 25,000 as directed. Subsequently, the petitioner deposited the amount, leading to directions for re-entry of the appeal against the original number by the Deputy Excise and Taxation Commissioner.

2. Another order raised a further demand of Rs. 2,86,988 for interest on the assessed tax amount under section 11-D of the Act. The petitioner's appeal to the appellate authority and Sales Tax Tribunal was dismissed for non-deposit of interest. The petitioner sought quashing of the order requiring deposit of interest as a condition for appeal.

3. The key contention revolved around the interpretation of Section 20(5) of the Act, which mandates proof of payment of tax or penalty for entertaining an appeal. The petitioner argued that the absence of the term "interest" in the provision exempted the deposit of interest as a condition. The State's position was that the provision should be read in conjunction with other sections like 11-D. The court held that Section 11-D only imposes a liability for interest and cannot be applied to appeal provisions. Consequently, the court directed re-entry and consideration of both appeals without prior deposit requirements.

4. Ultimately, the court disposed of the writ petition by directing the re-entry and consideration of the petitioner's appeals against the tax demand and interest order without insisting on prior deposits. The court emphasized that both appeals should be adjudicated according to the law, thereby resolving the issues raised by the petitioner effectively.