2013 (5) TMI 398 - HC - VAT and Sales Tax

Stay of demand - Condition imposed to satisfy 35% of the outstanding liability for availing the benefit of interim stay during the pendency of the appeal. - Held that - the assessment was finalized by the concerned authority on the basis of the available materials on record. It was to strike a balance, that the appellate authority passed orders, taking note of the sequence of events and the facts and figures, thus imposing a condition to the tune of 35% to be satisfied for availing the benefit of interim stay. - This Court does not find anything wrong, arbitrary or illegal in having passed such orders and hence interference is declined. However, taking note of the fact that, the time stipulated to satisfy the condition is already over, the petitioner is granted a further period of two weeks from the date of receipt of a copy of this judgment, to effect the deposit, for availing the benefit flowing interim order.

Summary

Issues:
1. Condition imposed by appellate authority for interim stay during appeal.
2. Allegation of lack of opportunity to substantiate facts and figures in assessment.
3. Validity of orders passed by the appellate authority.

Analysis:
1. The petitioner challenged the condition imposed by the appellate authority for granting interim stay during the appeal process, which required them to satisfy 35% of the outstanding liability. The petitioner contended that proper opportunity to substantiate facts and figures was not given, and the assessment was finalized without considering all relevant aspects. The High Court noted the sequence of events leading to the appeal, where the assessment was completed by the assessing authority after issuing notices and providing opportunities for objections and hearings. The Court found that the appellate authority's decision to impose the condition for interim stay was based on the available materials on record and was not arbitrary or illegal. The Court declined to interfere with the orders passed by the appellate authority.

2. The petitioner argued that they were not given a proper opportunity to present their case and that the assessment was based on turnover that should not have been taxed. However, the Court observed that the assessment was conducted following due process, with notices issued and opportunities provided for objections and hearings. The assessing authority proceeded with finalizing the assessment as the petitioner did not respond or appear on the scheduled date. The Court emphasized that the petitioner's case could be considered by the appellate authority during the appeal process, and the condition imposed for interim stay was a reasonable measure to balance the interests involved. The Court granted the petitioner an additional two weeks to satisfy the condition for availing the benefit of the interim stay.

3. After hearing arguments from both sides, the Court found that the appellate authority's orders were not arbitrary or illegal. The Court upheld the decision to impose the condition for interim stay, considering the sequence of events and the facts and figures involved in the case. While declining to interfere with the orders passed by the appellate authority, the Court granted the petitioner an extension to fulfill the condition within two weeks from the date of receiving the judgment. The writ petition was disposed of, with the Court maintaining the validity of the appellate authority's orders.