2015 (4) TMI 656 - HC - VAT and Sales Tax

Delayed payment of interest on the pre-deposit - Held that - DVAT had required the appellant to make a payment of ₹ 2.61 crores as pre-condition to the hearing of his appeal. The appellant could not, however, comply with the direction but did so about three years later. In these circumstances, by the impugned order Tribunal directed it to pay 15% interest for the intervening period. Section 76(4) primarily empowers the Tribunal to make appropriate orders for waiver of either the full or part pre-deposit. Although this power includes the power to make other directions, the present direction to pay interest 15% per annum on belated payment of deposit has acted as a further barrier and caused hardship. - ribunal s order is hereby modified. Instead of direction to pay 15% interest for belated payment, the appellant is hereby directed to deposit ₹ 10 lacs - Decided partly in favour of assessee.

Summary

Issues: Delayed payment of interest on pre-deposit required by Delhi VAT Appellate Tribunal (DVAT).

In the judgment delivered by the Delhi High Court, the appellant raised a substantial question of law regarding the order of the DVAT related to delayed payment of interest on the pre-deposit required for the appeal. The DVAT had initially directed the appellant to make a payment of &8377; 2.61 crores as a pre-condition for the appeal hearing, which the appellant failed to comply with promptly. The Tribunal later ordered the appellant to pay 15% interest for the delayed period. The appellant argued that this order was harsh and caused hardship, emphasizing that the pre-deposit requirement should not act as a barrier to the appeal's disposal on merits. On the contrary, the Revenue's counsel contended that since the appeal was pending, the appellant had to adhere to the order, and the imposition of 15% interest on belated payment was justified. The Court analyzed Section 76(4) and concluded that while the Tribunal had the power to waive pre-deposit partially or fully, the direction to pay 15% interest acted as an additional barrier and caused hardship. Consequently, the Court modified the Tribunal's order, directing the appellant to deposit &8377; 10 lacs within four weeks for the appeal to be heard, instead of paying 15% interest. The appeal was partly allowed under these revised terms.