2019 (10) TMI 1582 - HC - VAT and Sales Tax

Rejection of application filed by the petitioner to dispense with the deposit of 30% of disputed tax - It is the grievance of the petitioner that the demand made by the authorities under the Act results in double taxation, the same has not been properly appreciated by the Tribunal while considering the I.A filed, seeking waiver of the deposit of 30% of the disputed tax - HELD THAT - Section 63 7 a of the Act contemplates that the Appellate Tribunal may, in its discretion, stay payment of seventy percent of the tax or other amount disputed, if the appellant makes payment of the thirty percent of the tax or other amount disputed along with the prescribed form of appeal. This payment of 30% of the tax or the other amount disputed is mandatory and the same cannot be waived of, as claimed by the petitioner. Hence, there is no substance in the writ petition to set aside the order impugned. However, considering the totality of the circumstances of the case, this Court deems it appropriate to direct the Tribunal to dispose of the appeals in STA Nos.112/2019 and 113/2019 in an expedite manner preferably within a period of three months from today. Petition disposed off.

Summary

Issues:
Challenge to order rejecting waiver of deposit of disputed tax under Karnataka Value Added Tax Act, 2003.

Analysis:
The petitioner, a registered dealer under the Karnataka Value Added Tax Act, 2003, challenged the order of the Karnataka Appellate Tribunal rejecting the waiver of the deposit of 30% of disputed tax. The petitioner contended that the demand by the authorities resulted in double taxation, which was not properly considered by the Tribunal.

The Act provides under Section 63[7][a] that the Appellate Tribunal may stay payment of seventy percent of the disputed tax if the appellant pays thirty percent of the tax along with the appeal. The payment of 30% is mandatory and cannot be waived. The High Court found no merit in the petitioner's claim to set aside the impugned order based on this provision.

Despite upholding the requirement of the 30% deposit, the Court, considering the circumstances, directed the Tribunal to expedite the disposal of the appeals within three months. This directive aimed to ensure a swift resolution of the matter.

In conclusion, the High Court dismissed the writ petition challenging the rejection of the waiver of the deposit of disputed tax. The Court emphasized the mandatory nature of the 30% payment under the Act but also instructed the Tribunal to expedite the proceedings for a timely resolution.