2024 (6) TMI 996 - HC - VAT and Sales Tax

Rejection of petitioner s stay application during pendency of the petitioner s appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal at Visakhapatnam - seeking grant of stay for the tax period from April, 2015 to June, 2017, during pendency of the appeal before the Tribunal - HELD THAT - 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. So far as the production of evidence in support of the petition, is concerned, as mentioned in the impugned order to dispute the revisional order, the appeal being pending, such matter has to be seen by the Appellate authority, on merits while deciding the appeal. 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. 1 is not justified in rejecting the petitioner s stay application. The impugned order, therefore, is set-aside. Subject to the petitioner depositing 25% more of the disputed tax i.e., total 50% inclusive of the statutory deposit in filing appeal before the Appellate Tribunal, within a period of six (06) weeks, before the assessing authority/ respondent No. 3, the recovery proceedings for the balance of the amount i.e., in respect of 50%, shall remain stayed during the pendency of appeal before the Appellate Tribunal - Petition allowed in part.

Summary

Issues involved:
The judgment deals with a writ petition filed under Article 226 of the Constitution of India to challenge the rejection of a stay application during the pendency of an appeal before the Andhra Pradesh Value Added Tax Appellate Tribunal.

Details of the Judgment:

Issue 1: Rejection of Stay Application
The petitioner sought setting aside of the proceedings rejecting the stay application for the tax period from April 2015 to June 2017 during the pendency of the appeal before the Tribunal. The impugned order was challenged on the grounds of lack of cogent reasons and failure to produce evidence in support of the stay petition. The petitioner argued that once the appeal was filed and statutory requirements were met, rejection of the stay was not justified.

Issue 2: Legal Precedent
The petitioner relied on a previous case where, during the pendency of an appeal and upon depositing 25% of the tax amount, the court had ordered that no coercive action be taken for recovery of the balance amount. The Government Pleader for Commercial Tax did not dispute this previous order and suggested that a similar condition could be considered in the present case.

Issue 3: Court's Analysis and Decision
The Court observed that the petitioner had filed the appeal and complied with the statutory deposit, which ordinarily warrants a stay on recovery of the balance amount. The impugned order lacked cogent reasons for rejection and failed to consider that evidence in support of the petition should be examined by the Appellate authority during the appeal process. In light of the previous legal precedent and the circumstances of the case, the Court set aside the impugned order and granted a stay on recovery proceedings subject to the petitioner depositing an additional 25% of the disputed tax within a specified period.

Separate Judgment by the Court:
The Court allowed the writ petition in part, quashing the impugned order and providing specific directions for the petitioner to meet additional deposit requirements for the stay to remain in effect during the appeal before the Appellate Tribunal. No costs were awarded, and pending miscellaneous petitions were closed as a result of the judgment.