2018 (4) TMI 1220 - HC - VAT and Sales Tax

Stay order - furnishing of Bank Guarantee or security deposit - Held that - At the time, when the Appeal Petition was entertained, 75% of the disputed tax has already been remitted by the petitioner. Therefore, this Court is of the view that the interest of the Revenue has been sufficiently safeguarded and to safeguard further interest of the Revenue, the petitioner can be directed to file a bond for the remaining tax and penalty - petition allowed in part.

Summary

Issues:
Challenge to order passed by second respondent in Stay Petition No.2 of 2018; Modification of order to execute a personal bond instead of furnishing bank guarantee.

Analysis:
The petitioner challenged the order passed by the second respondent in Stay Petition No.2 of 2018 by filing an Appeal Petition, A.P.No.920 of 2017, against the order issued by the first respondent on 24.08.2017. The second respondent, while granting a stay order, directed the petitioner to provide a bank guarantee or security deposit for the remaining disputed tax and penalty, to be valid until 22.07.2018. However, at the time of filing the Appeal Petition, the petitioner had already remitted 75% of the disputed tax, indicating sufficient safeguarding of the Revenue's interest. To further protect the Revenue's interest, the court decided that the petitioner should submit a bond for the outstanding tax and penalty instead of a bank guarantee.

The High Court partly allowed the Writ Petition and modified the second respondent's order dated 22.01.2018. The modification required the petitioner to execute a personal bond for the remaining tax and penalty for the relevant assessment year within two weeks from the receipt of the court's order. The petitioner was instructed to maintain the bond until the Appeal Petition No.920 of 2017 was disposed of. No additional costs were imposed, and the connected Writ Miscellaneous Petitions were closed as a consequence of this decision.