2024 (6) TMI 173 - HC - VAT and Sales Tax

Dismissal of petitioner s stay application during pendency of the petitioner s appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal at Visakhapatnam - petitioner filed petition seeking stay of collection of balance amount before 4th respondent of which stay petition was rejected by the impugned order - HELD THAT - Indisputably, the petitioner has filed the appeal which is pending for consideration before the Tribunal, Visakhapatnam. It is also not disputed that the petitioner complied with the statutory deposit for filing appeal. Once the statutory appeal is pending before the Appellate authority for adjudication, ordinarily the recovery of the balance amount deserves stay unless for special reasons, to be recorded in the order, recovery of the balance amount deserves not to be stayed or the balance amount has to be recovered even during pendency of the appeal, which is a statutory and valuable right. The stay may be the subject to imposing some conditions, which is also contemplated by Section 33 (b) of APVAT Act, 2005 - The impugned order does not record any cogent reasons to reject the stay petition. It was provided that the Appellate authority shall make endeavour to decide the appeal within a specific period. The order of rejection of the stay was passed with the conditions. In that case, in addition to the statutory deposit of 25%, the petitioner therein had deposited in total 50% inclusive of 25% of the statutory deposit under the orders of the Court passed in Writ Petition No. 10 of 2023 and considering that total 50% deposit, the stay was granted during pendency of the appeal before the Appellate Tribunal. The respondent No. 4 is not justified in rejecting the petitioner s stay application. The impugned order, therefore, is set-aside - Petition allowed in part.

Summary

Issues involved:
The issues involved in this case are the rejection of the petitioner's stay application by the respondent No. 4 and the subsequent legal proceedings regarding the tax period from May, 2013 to March, 2016 under the Andhra Pradesh Value Added Tax Act, 2005.

Judgment Summary:

Issue 1: Rejection of Stay Application
The petitioner filed a writ petition under Article 226 of the Constitution of India to challenge the proceedings of the respondent No. 4, who dismissed the petitioner's stay application during the pendency of the appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal. The petitioner sought stay for the tax period from May, 2013 to March, 2016. The High Court observed that once the statutory appeal is pending before the Appellate authority for adjudication, the recovery of the balance amount deserves stay unless special reasons are recorded in the order. The impugned order was found to lack cogent reasons for rejecting the stay petition. Referring to a previous case, the Court set aside the impugned order and directed the petitioner to deposit an additional 25% of the disputed tax within six weeks for the recovery proceedings to remain stayed during the appeal.

Issue 2: Compliance with Statutory Requirements
The petitioner had filed an appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal at Visakhapatnam after depositing the statutory amount. The Court noted that the petitioner complied with the statutory deposit for filing the appeal, and emphasized that recovery of the balance amount should ordinarily be stayed during the appeal process, as it is a statutory right. The Court highlighted the importance of imposing conditions for stay as contemplated by Section 33(b) of the APVAT Act, 2005. The respondent No. 4 was deemed unjustified in rejecting the petitioner's stay application, leading to the setting aside of the impugned order.

Conclusion:
The High Court allowed the writ petition in part, quashing the impugned order and directing the petitioner to deposit an additional 25% of the disputed tax within six weeks to ensure the recovery proceedings remain stayed during the pendency of the appeal before the Appellate Tribunal. No costs were awarded, and any pending miscellaneous petitions were to be closed accordingly.