2017 (3) TMI 1296 - HC - VAT and Sales Tax

Waiver of pre-deposit - bank guarantee to be made for the purpose of consideration of the appeal - Counsel for the petitioner says that uptill now 50% of the disputed tax has already been paid. The counsel further says that the petitioner is willing to furnish a personal bond for the balance disputed tax and penalty as against a bank guarantee sought for by the respondents - Held that - the impugned order is modified to the extent that instead of a bank guarantee, the petitioner would furnish a personal bond for the balance amount of disputed tax and the entire penalty amount, within two (2) weeks from the date of receipt of a copy of the order. Upon such personal bond being furnished, there shall be a stay qua the Order-in-Original dated 30.05.2016, pending consideration of the appeal preferred before the first respondent - petition allowed - decided in favor of petitioner.

Summary

Issues:
1. Challenge to the order directing to furnish a bank guarantee for disputed tax and penalty.
2. Request to modify the order to allow furnishing a personal bond instead of a bank guarantee.
3. Consideration of the appeal pending before respondent No.1 for the Assessment Year 2015-2016.

The High Court of Madras addressed a Writ Petition challenging an order that required the petitioner to provide a bank guarantee for the disputed tax and penalty amounting to ?10,75,641 claimed by the Revenue for the appeal's consideration. The petitioner had already paid 50% of the disputed tax and expressed willingness to offer a personal bond for the remaining amount instead of a bank guarantee. The petitioner referred to a previous order in a similar case to support this request. The Court, after hearing both parties, modified the impugned order. It allowed the petitioner to furnish a personal bond for the balance of the disputed tax and the entire penalty amount within two weeks, staying the Order-in-Original pending the appeal's consideration. The Writ Petition was disposed of with no costs, and the connected Miscellaneous Petition was closed.

This judgment primarily dealt with the challenge against an order mandating the provision of a bank guarantee for a disputed tax and penalty amount. The petitioner sought to modify this order to allow for the submission of a personal bond instead. The Court considered the petitioner's willingness to pay 50% of the disputed tax already and the proposal to provide a personal bond for the remaining amount. The petitioner's reliance on a previous order in a similar case supported this request. After hearing both parties, the Court modified the impugned order to permit the petitioner to furnish a personal bond for the balance of the disputed tax and the entire penalty amount within a specified timeline. This modification resulted in a stay on the Order-in-Original until the appeal's consideration by the first respondent for the Assessment Year 2015-2016.

In conclusion, the High Court of Madras allowed the modification of the order requiring a bank guarantee for the disputed tax and penalty. Instead, the petitioner was permitted to provide a personal bond for the remaining amount. This decision was influenced by the petitioner's partial payment of the disputed tax, willingness to offer a personal bond, and reference to a relevant previous order. The Court's modification provided relief to the petitioner by staying the Order-in-Original pending the appeal's consideration, ultimately disposing of the Writ Petition with no costs incurred.