2016 (3) TMI 934 - HC - VAT and Sales Tax

Validity of dismissal order passed by below authorities - Whether on the facts and circumstances of the case, both the authorities below were justified in dismissing the appeals by holding the condition of pre-deposit of 25% as mandatory for the entertainment of appeal - Held that - the issue involved in this appeal stands concluded by the decision of this Court in Punjab State Power Corporation Limited v. The State of Punjab and others 2016 (2) TMI 245 - PUNJAB AND HARYANA HIGH COURT . Therefore, by following this, the orders passed by the Deputy Excise and Taxation Commissioner (Appeals) and the Tribunal are set aside. - Matter remanded back

Summary

Issues:
Appeal under Section 68 of Punjab Value Added Tax Act, 2005 against Tribunal's order on pre-deposit requirement.

Analysis:
The appellant, a dealer in chemicals, filed returns for the assessment year 2009-10 and availed Input Tax Credit (ITC). An additional demand of Rs. 3,30,51,478/- was created by the Excise and Taxation Officer, leading to an appeal by the appellant. The Deputy Excise and Taxation Commissioner (Appeals) dismissed the appeal for non-deposit of 25% under Section 62(5) of the Act. Subsequently, the Tribunal upheld this decision. However, a related case challenged the vires of Section 62(5), resulting in a remand to the first appellate authority. The appellant then filed a writ petition which was withdrawn, leading to the current appeal.

The High Court noted that the issue at hand was previously addressed in a related case where it was held that the first appellate authority has the power to grant interim protection/injunction and can waive the pre-deposit condition under Section 62(5) in deserving cases. This power is not to be exercised routinely but only when a strong prima facie case is established. The High Court emphasized that the authority must ensure that the purpose of the appeal is not frustrated by the pre-deposit condition. Therefore, the orders of the Deputy Excise and Taxation Commissioner (Appeals) and the Tribunal were set aside, and the matter was remanded to the Deputy Excise and Taxation Commissioner (Appeals) in line with the judgment in the related case.

In conclusion, the High Court allowed the appeal, setting aside the previous orders and remanding the matter for reconsideration by the Deputy Excise and Taxation Commissioner (Appeals) in accordance with the principles outlined in the related case regarding the power to waive pre-deposit conditions under Section 62(5) of the Punjab Value Added Tax Act, 2005.