2019 (11) TMI 46 - HC - VAT and Sales Tax

Maintainability of appeal - non-compliance with the condition of pre-deposit - HELD THAT - Counsel for the appellant prays for two months' time for fulfilling the condition of pre-deposit for maintaining his appeal - Mr.Ajay Jagga, counsel for UT has no objection to the grant of such time. The present appeal is disposed of with a direction that in case the appellant deposits the required 25 per cent of the additional demand on or before 31.12.2019, then the appeal shall be entertain and decided on merits by the First Appellate Authority.

Summary

Issues:
1. Compliance with pre-deposit condition under Section 62(5) of the Punjab Value Added Tax Act, 2005 and Section 63 of the Act.
2. Applicability of waiver of pre-deposit condition based on merits and hardship of the case.
3. Impact of the Supreme Court judgment in M/s Tecnimont Pvt. Ltd. v. State of Punjab & Others on the waiver of pre-deposit condition.
4. Request for extension of time to fulfill the pre-deposit condition.

Analysis:
1. The appellant, a proprietorship firm engaged in selling tyres and tubes, was assessed additional demands under the Punjab Value Added Tax Act, 2005 and the Central Sales Tax Act, 1956. The appellant's appeal against the assessment was dismissed by the First Appellate Authority for not complying with the pre-deposit condition of 25% under Section 62(5) of the Act.

2. Subsequently, the appellant appealed to the Value Added Tax Tribunal, UT, Chandigarh under Section 63 of the Act, which also dismissed the appeal due to the appellant's failure to deposit the required amount. The appellant then filed the present appeal under Section 68 of the Act seeking relief from the pre-deposit condition.

3. The Court considered a previous judgment by the Punjab and Haryana High Court which allowed authorities to waive the pre-deposit condition based on the merits and hardship of the case. However, it was noted that this judgment had been overruled by the Hon'ble Supreme Court in the case of M/s Tecnimont Pvt. Ltd. v. State of Punjab & Others, decided on 18.9.2019. The Supreme Court's decision established that the appellant must deposit the stipulated 25% of the additional demand to maintain the appeal.

4. During the hearing, the appellant's counsel requested a two-month extension to fulfill the pre-deposit condition. The counsel for UT did not object to this request. The Court disposed of the appeal with a direction that if the appellant deposits the required 25% of the additional demand by 31.12.2019, the appeal will be entertained and decided on its merits by the First Appellate Authority.