2021 (1) TMI 749 - HC - VAT and Sales Tax

Maintainability of appeal - appeal dismissed on the ground of non-payment of 20 % of the total dues towards pre-deposit as provided under Section 74 of the Act, 2003 - HELD THAT - No error not to speak of any error of law could be said to have been committed by the Tribunal in passing the impugned order. No case is made out to interfere on any of the grounds raised in this writ application. With a view to give one chance to the writ applicants, we inquired with Mr. Gandhi, the learned counsel appearing for the writ applicants, whether his clients would be in a position to furnish some tangible security in lieu of deposit of 20 % of the total tax dues. However, Mr. Gandhi submitted that his clients are not in a position to offer any tangible security of any nature. Application dismissed.

Summary

Issues:
1. Challenge to assessment order under Gujarat Value Added Tax Act, 2003.
2. Dismissal of First Appeal due to nonpayment of pre-deposit.
3. Tribunal's order requiring pre-deposit and subsequent dismissal of Second Appeal.
4. Writ application challenging Tribunal's order.

Analysis:

1. The writ applicants challenged an assessment order under the Gujarat Value Added Tax Act, 2003, which determined a significant tax liability. The First Appellate Authority summarily dismissed their appeal due to nonpayment of 20% of the total dues as pre-deposit, as mandated by Section 74 of the Act.

2. The writ applicants then approached the Tribunal with a Second Appeal, arguing their eligibility for Input Tax Credit and contesting the dismissal of the First Appeal. The Tribunal, after considering submissions from both parties, admitted the Second Appeal on the condition that the appellants deposit 20% of the tax amount as pre-deposit within a specified timeframe.

3. Subsequently, the Tribunal issued an order requiring the pre-deposit, which the appellants failed to comply with. The Tribunal, considering the facts and circumstances, dismissed the Second Appeal for noncompliance with the pre-deposit direction, thereby vacating any earlier granted relief.

4. Dissatisfied with the Tribunal's decision, the writ applicants approached the High Court through a writ application. The High Court, after hearing arguments from both sides, found no error or legal grounds to interfere with the Tribunal's order. Despite inquiring about offering tangible security in place of the pre-deposit, the writ applicants were unable to provide any, leading to the dismissal of the writ application.

In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of compliance with legal requirements and the lack of grounds for intervention in the matter.