2024 (4) TMI 220 - HC - VAT and Sales Tax

Maintainability of appeal - requirement to pay the mandatory pre-deposit under the GVAT Act and CST Act. It is the case of the petitioner that the Commissioner Appeals as well as the Tribunal while passing an order of pre-deposit has not considered the prima facie case in favour of the appellant. HELD THAT - It appears that the Tribunal has imposed the condition of pre-deposit consisting of the entire demand under the Central Sales Tax. The Tribunal has passed an order requiring the appellant to deposit Rs. 36,00,000/- out of the total remaining demand of Rs. 36,19,825/-. Therefore we are of the opinion that the Tribunal has exceeded its jurisdiction in passing the order of pre-deposit without considering the fact that if the appellant is required to pay almost entire amount of the outstanding dues then the very purpose of pre-deposit would be frustrated. Therefore, as the appellant is ready and willing to deposit Rs. 5,00,000/- to show the bona fides and to enable the appellant to furnish the statutory forms in the remaining period of pre-deposit, the interest of justice would be served if the amount of pre-deposit is reduced to Rs. 5,23,000/-. The appellant is therefore to deposit Rs. 5,23,000/- on or before 15.07.2024 towards the mandatory pre-deposit in the appellate proceedings and the present appeal filed by the appellant is accordingly allowed to the aforesaid extent and the matter is remanded back to the First Appellate Authority who will hear the appeals filed by the appellant on deposit of Rs. 5,23,000/- on or before 15.07.2024 - Matter on remand.

Summary

Issues involved: Interpretation of pre-deposit requirements u/s 78 of the Gujarat Value Added Tax Act, 2003 and the Central Sales Tax Act.

The appellant challenged the orders of assessment for the Assessment Period 2014-15 before the Tribunal under Section 73 of the VAT Act and Section 9(2) of the CST Act due to non-payment of pre-deposit. The Tribunal determined pre-deposit amounts of Rs. 23,000/- under the GVAT Act and Rs. 36,00,000/- under the CST Act for non-production of statutory forms. The appellant contended that the pre-deposit amounts were beyond their financial means and proposed to pay Rs. 5,00,000/- as a compromise. The respondent argued that the Tribunal's decision was justified considering the appellant's failure to submit statutory forms amounting to approximately Rs. 6 Crores. The High Court found that the Tribunal had exceeded its jurisdiction by requiring the appellant to deposit almost the entire outstanding dues, which would defeat the purpose of pre-deposit. Consequently, the Court reduced the pre-deposit amount to Rs. 5,23,000/-, to be paid by the appellant before 15.07.2024, allowing the appeal to that extent and remanding the matter back to the First Appellate Authority for further proceedings.