2015 (5) TMI 451 - HC - VAT and Sales Tax

Waiver of pre deposit - Whether the Appellate Tribunal, Value Added Tax was justified in directing the appellant to deposit 25% of the amount in dispute in respect of assessment of tax, though the appellate authority on the question of quantum and other issues had remanded the matter to the assessing authority and, therefore, no payment was due and payable on the date when the appeal was preferred and on 24th April, 2014, when the Appellate Tribunal had passed the order directing the said pre-deposit - Held that - When there was no demand, which was due and payable, we do not think that the appellant was required to pay 25% of the disputed amount . The reason is simple, because when no demand was in existence and payable, the question of waiver of pre-deposit would not arise. There is difference between waiver of pre-deposit and direction to pay tax which was not determined and decided. Appellate tribunal has decided the application for waiver of deposit. It has not decided an application of the revenue that ad hoc payment should be deposited, assuming that such application was maintainable. The aforesaid distinction has not been kept in mind and deliberated while deciding an application for waiver of pre-deposit. In fact the appellant was not required to file the said application. Noticeably, the appellant assessee had deposited 5% of amount in dispute i.e. ₹ 1,65,670 as per the directions of Additional Commissioner, the first appellate authority. If we accept ratio and direction to deposit 25% of the demand, originally computed but set aside, we would be restoring and in a manner directing payment of an amount not due and payable. - Decided in favour of assessee.

Summary

Issues:
1. Condonation of delay in filing the appeal.
2. Justification of directing appellant to deposit 25% of the amount in dispute.
3. Interpretation of waiver of pre-deposit in the absence of a due and payable demand.

Analysis:
1. The judgment begins with an application for condonation of delay of 100 days in filing the appeal, which was initially a writ petition re-numbered as an appeal. The Revenue's counsel had no objection, leading to the allowance of the application for condonation of delay.

2. The main issue addressed was whether the Appellate Tribunal was justified in directing the appellant to deposit 25% of the amount in dispute, despite the matter being remanded to the assessing authority with no payment due at the time of appeal. The appellant was assessed additional tax under the Delhi Sales Tax Act, and the first appellate authority remanded the case for further consideration. The Tribunal found that no amount was due and payable when the appeal was filed, thus ruling in favor of the appellant against the Revenue.

3. The court clarified the distinction between waiver of pre-deposit and the direction to pay tax that was not determined. The appellant had already deposited 5% of the disputed amount as per the first appellate authority's directions. The Tribunal's decision to require a 25% deposit was deemed inappropriate as it would result in payment of an amount not actually due and payable. The judgment favored the appellant, stating that the Tribunal should hear the appeal on its merits without expressing an opinion on the findings of the first appellate authority.

In conclusion, the judgment allowed the appeal, emphasizing that the appellant was not required to pay 25% of the disputed amount when no demand was due and payable. The court directed the Tribunal to hear the appeal on its merits without expressing any opinion on the previous findings, ultimately ruling in favor of the appellant against the Revenue.