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2023 (3) TMI 1458 - HC - VAT and Sales TaxRejection of petitioner s application for waiver of pre-deposit under Section 63(4) of the KVAT Act - validity of the provisions of Section 63(4) of the KVAT Act - HELD THAT - On careful consideration of these circumstances, and this Court s opinion on modulating the requirement of pre-deposit under Section 63(4) of the KVAT Act in the light of the earlier decision of this Court, this Court is of the considered view that the petitioner, which cannot be granted complete waiver, must deposit 50% (15% of the amount in demand) of the requirement of pre- deposit under Section 63(4) of the KVAT Act with reasonable time. The petitioner is permitted to deposit 50% (that is 15% of the amount in demand) as required under Section 63(4) of the KVAT Act and the petitioner shall be at liberty to make this deposit within six (6) weeks from the date of receipt of a certified copy of this order - Petition allowed in part.
Issues involved:
The petitioner challenged the common order of the Karnataka Appellate Tribunal under Section 63 of the Karnataka Value Added Tax Act 2003 (KVAT Act). The issues included the rejection of the petitioner's application for waiver of pre-deposit under Section 63(4) of the KVAT Act, and the denial of input tax credit (ITC) due to belated filing of Returns in Form VAT 100. The validity of Section 63(4) of the KVAT Act was also questioned. Impugned Common Order and Waiver of Pre-deposit: The Tribunal rejected the petitioner's application for waiver of pre-deposit under Section 63(4) of the KVAT Act, citing the mandate of law and lack of discretion to waive the pre-deposit. The petitioner sought waiver based on genuine reasons, including the pending consideration by the Supreme Court on whether ITC can be denied for belatedly filed Returns. Contentions of the Petitioner: The petitioner argued that despite belated filing of Returns, taxes were paid for the relevant period, and there was no loss to the State Exchequer. The petitioner's plea for waiver of pre-deposit was supported by circumstances such as the Managing Partner's wife's illness, which led to delayed filing. The petitioner emphasized the need for a final decision on ITC availability based on belated Returns. Arguments of the Respondents: The Additional Government Advocate contended that pre-deposit under Section 63(4) of the KVAT Act is mandatory and integral to the appeal process. The discretion to grant stay is linked to pre-deposit, and any waiver would be contrary to the statutory scheme. Referring to precedent, it was asserted that the 30% pre-deposit requirement cannot be waived. Court's Decision on Pre-deposit and Waiver: Considering the circumstances and previous judgments modulating pre-deposit requirements, the Court allowed partial relief to the petitioner. The petitioner was directed to deposit 50% (15% of the amount in demand) within six weeks, with the Tribunal to consider the request for deferring proceedings pending the Supreme Court's decision. Conclusion: The Court modified the Tribunal's order, permitting partial deposit and granting the petitioner the opportunity to seek deferment of proceedings. The decision balanced the statutory requirements with the petitioner's genuine reasons for seeking relief, ensuring a fair consideration of the case.
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