2015 (9) TMI 579 - HC - VAT and Sales Tax

Pre-deposit Condition Deposit of partial amount Vide order passed by Appellate Authority demand was raised directing dealer to deposit 25% of total demand raised as pre-deposit On ground of failure to comply with order of pre-deposit, Appellate Authority dismissed appeals Tribunal directed appellant to deposit total sum of ₹ 20 lacs, on non-compliance of which Tribunal dismissed both appeals Held that - Admitted that appellant had deposited total sum of ₹ 14 lacs, therefore appellant to be given some more reasonable time to appellant to deposit balance amount as pre-deposit and on that Appellate Authority directed to decide and dispose of appeals in accordance with law and on merits If appellant fails to make deposit of aforesaid amount, Appellate Authority s order on noncompliance of pre-deposit stands Decided in favour of assesse.

Summary

Issues:
1. Noncompliance with pre-deposit order under VAT Act and CST Act for the years 2008-09 and 2009-10.
2. Appeal against the order of dismissal due to noncompliance with pre-deposit.
3. Request for extension to deposit the balance amount of pre-deposit.
4. Decision on granting more time for pre-deposit and direction to decide the appeals on merits.

Analysis:

Issue 1:
The appeals arose from an order passed by the first Appellate Authority under the VAT Act and CST Act, demanding a total of Rs. 8,82,80,472, including a tax demand of Rs. 1,87,80,269. The appellant was directed to pre-deposit 25% of the total demand, failing which the appeals were dismissed. The Tribunal then ordered a total deposit of Rs. 20 lakhs, leading to the dismissal of the appeals due to noncompliance.

Issue 2:
Feeling aggrieved by the Tribunal's order, the appellant filed Tax Appeals before the High Court. Initially, the appellant deposited Rs. 14 lakhs against the pre-deposit of Rs. 20 lakhs. The Court adjourned the hearing to allow the appellant to deposit the remaining balance. The appellant withdrew the appeals challenging the Tribunal's order and filed fresh appeals against the orders related to pre-deposit and the final common order.

Issue 3:
During the hearing, the appellant's counsel requested more time to deposit the balance amount of Rs. 6 lakhs, stating financial difficulties and business closure. The appellant sought an opportunity to manage the deposit and requested the appeals to be decided on merits if the balance amount could be deposited.

Issue 4:
After hearing both parties, the Court considered the appellant's request for additional time to deposit the balance pre-deposit amount. The Court found the request reasonable and directed the appellant to deposit the remaining Rs. 6 lakhs within eight weeks. It was decided that if the deposit was made within the specified time, the first Appellate Authority would decide the appeals on merits. Failure to comply within the given period would result in the dismissal of the appeals.

In conclusion, the High Court allowed the appellant an extension to deposit the balance pre-deposit amount, emphasizing that compliance within the stipulated time frame was crucial for the appeals to be decided on their merits.