2003 (11) TMI 580 - HC - VAT and Sales Tax

Summary

Issues:
1. Cancellation of registration certificate due to business closure and heavy losses.
2. Assessment order for tax liability for the year 1996-97.
3. Appeal filed against the assessment order.
4. Directions by appellate authorities for payment of tax in installments.
5. Dismissal of appeal due to non-payment of pre-deposit.
6. Review petition filed against dismissal of appeal.
7. Justification for requiring pre-deposit before adjudication.
8. Granting an opportunity for hearing and adjudication on merits.

Analysis:
1. The petitioner, engaged in manufacturing plywood boards, had its registration certificate canceled in 1998 due to business closure in 1994 following significant losses.
2. An assessment order for tax liability of Rs. 1,21,000 for the year 1996-97 was issued against the petitioner.
3. The petitioner appealed the assessment order before the Joint Excise and Taxation Commissioner (Appeals) and also applied for a stay.
4. The appellate authority directed the petitioner to pay the tax in six monthly installments starting from February 1999.
5. Subsequent appeals and remands by the Sales Tax Tribunal, Haryana, led to dismissal of the petitioner's appeal due to failure to deposit the assessed tax as directed.
6. Despite filing a review petition, the petitioner faced dismissal of the appeal by the Sales Tax Tribunal, Haryana.
7. The court acknowledged the statutory requirement for pre-deposit before appeal adjudication and justified the dismissal of the appeal for non-compliance.
8. However, considering the circumstances and the petitioner's claim of business cessation in 1994, the court granted a three-month extension for the petitioner to make the pre-deposit. If the deposit is made within the extended period, the appeal will be reconsidered on merits; otherwise, the earlier appellate order will stand affirmed.

This judgment highlights the importance of complying with statutory provisions regarding pre-deposit before appeal adjudication while also balancing the need for a fair opportunity for hearing and adjudication on merits, especially in cases with unique circumstances like business closure and financial losses.