2018 (2) TMI 313 - HC - VAT and Sales Tax

Pre-deposit - Whether under the facts and circumstances, the learned Tribunal has not erred in hearing the Second Appeal on merits when the First Appeal was dismiss on the ground of pre deposit? - Held that - the Tribunal has exercised its discretion and has held that the amount deposited is sufficient for admission and stay. The order passed by the Tribunal, having regard to the facts of the case, appears to be just and proper and there is no reason to believe that the same is in any manner arbitrary or rendered without application of mind to the circumstances of the case - it cannot be said that the impugned order passed by the Tribunal suffers from any legal infirmity - appeal dismissed.

Summary

Issues:
Challenging common order of Gujarat VAT Tribunal on predeposit and assessment amount.

Analysis:
In this case, the State of Gujarat challenged a common order of the Gujarat Value Added Tax Tribunal related to appeals under section 78 of the Gujarat Value Added Tax, 2003. The State raised two substantial questions of law regarding the Tribunal's decision. The first question was whether the Tribunal erred in hearing second appeals on merits when the first appeals were dismissed due to nonpayment of predeposit. The second question was whether the Tribunal erred in concluding that the amount prescribed by the First Appellate Authority did not need to be taken from the respondent. The Tribunal had allowed the second appeals, setting aside the orders of the First Appellate Authority and directing a fresh hearing on merits while granting a stay on recovery of outstanding amounts.

The State argued that the Tribunal was unjustified in interfering with the First Appellate Authority's order and not requiring the appellant to make the predeposit as directed. On the other hand, the respondent supported the Tribunal's decision, stating it was just, legal, and proper. The Court observed that the Tribunal had focused on the issue of predeposit and did not delve into the merits of the assessment order. The Tribunal noted that the respondent had paid the entire tax amount for all four second appeals, totaling to ?2,35,05,951. The Tribunal considered this payment as sufficient for predeposit and granted a stay on recovery until the final disposal of the appeals. The Court found that the Tribunal had reasonably exercised its discretion in determining the predeposit amount and that the order appeared just and proper. Consequently, the appeals were dismissed summarily, as the Tribunal's order was deemed legally sound without any substantial question of law arising.

Therefore, the Court upheld the Tribunal's decision, emphasizing the importance of the Tribunal's discretion in determining the predeposit amount and finding no legal infirmity in the order.