2004 (5) TMI 537 - HC - VAT and Sales Tax

Summary

Issues:
- Interpretation of the right to withdraw an appeal under the U.P. Sales Tax Act, 1948.
- Authority of the appellate authority to allow an appeal despite an application for withdrawal.
- Examination of statutory provisions and judicial precedents regarding withdrawal of appeals.

Analysis:
The judgment by the Allahabad High Court dealt with six revisions involving the question of whether the appellate authority under the U.P. Sales Tax Act, 1948, can allow an appeal and remand the matter to the assessing authority for fresh consideration when an application to withdraw the appeal has been filed. The dealer, a partnership firm engaged in manufacturing and selling bricks, had filed appeals challenging best judgment assessment orders for the years 1984-85, 1985-86, and 1986-87. During the appeals, the dealer sought permission to withdraw them, which was opposed by the departmental representative citing the possibility of under-assessment. The appellate authority decided to remand the matter to the assessing authority for proper examination of certain issues, despite the withdrawal application.

The primary argument raised was whether the right to file an appeal includes the right to withdraw it unless prohibited by statute. The proviso to section 9(3)(b) of the Act was cited, allowing the appellate authority to dismiss an appeal upon withdrawal application without a request for enhancement of assessment or penalty. The Court examined the statutory provisions, emphasizing that appeals can only be filed by aggrieved dealers and not by the department. Judicial precedents were also considered, highlighting that the appellate authority's power includes the ability to enhance assessments, but not to allow appeals against the appellant's wishes.

The Court referenced Supreme Court decisions to assert that the appellant has the right to unconditionally withdraw an appeal unless a vested right of the respondent is affected. Additionally, a Gujarat High Court ruling emphasized that the High Court can decline to answer a reference if the party withdrawing the reference has no interest. The Orissa High Court similarly held that an appeal can be withdrawn by the appellant unless a notice for enhancement has been issued. Considering these principles and the proviso, the appellate authority's decision to allow the appeal despite the withdrawal application was deemed to exceed its jurisdiction.

Ultimately, the Court allowed the revisions, dismissing the appeals filed by the dealer as withdrawn. The judgment clarified the limitations on the appellate authority's power in allowing appeals against the wishes of the appellant, reaffirming the right to withdraw appeals unconditionally in certain circumstances.