2013 (4) TMI 99 - HC - VAT and Sales Tax

Revision application - Tribunal has increased the stay order to the extent of 80% as against 50% allowed earlier still not satisfied the assessee has preferred this revision - Held that - It has been settled by various decisions that while considering the stay application, the authorities should deal with the prima facie merit of the case and in case the chances of success are more the interim protection be accorded accordingly. In the present case the tribunal has not dealt with the case on merits at all in granting interim protection and the same has been granted simply for the reason that the Presiding Officers are not available. Thus the revision only involves application of the settled law and no question of law but as the settled principles applicable for grant of interim protection have not been adhered in the interest of justice, the revision is being disposed of with the direction to the FAA to reconsider the matter within a period of one month from the date of production of certified copy of this order. For a period of six weeks or till final assessment order is passed or the interim stay application is considered by the FAA whichever is earlier no coercive measure shall be taken to recover the disputed amount of tax from the assessee.

Summary

Issues:
1. Stay application for interim protection during appeal process.
2. Consideration of prima facie case and chances of success in granting limited protection.
3. Adherence to settled principles for granting interim protection.

Analysis:
1. The case involves a dispute regarding the grant of interim protection to the assessee revisionist during the appeal process against a provisional assessment order for the assessment year 2011-12. Initially, the revisionist was granted 50% stay subject to certain conditions, which was later increased to 80% by the tribunal. Dissatisfied with this, the revisionist filed a revision seeking further relief.

2. The revisionist's counsel argued that the authorities should have finalized the annual assessment instead of relying on provisional assessment. Additionally, it was contended that the authorities did not consider the prima facie case or the chances of success in the appeal process when granting limited protection. The settled legal position requires authorities to assess the merit of the case and grant interim protection accordingly.

3. The court noted that the tribunal did not evaluate the case on its merits while granting interim protection. Instead, the protection was provided due to the unavailability of Presiding Officers. Despite finding no question of law involved, the court set aside the orders granting interim protection and directed the first appellate authority to reconsider the matter within a month, adhering to settled principles for granting interim protection.

4. As a result of the judgment, no coercive measures can be taken to recover the disputed tax amount for a specified period, provided the assessee furnishes security other than cash and bank guarantee within two weeks. The assessing authority is also directed to finalize the annual return submitted by the assessee within three months of the court order. The revision was disposed of accordingly, emphasizing the importance of adhering to established legal principles in granting interim protection during the appeal process.