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2025 (4) TMI 1108 - HC - VAT / Sales TaxRejection of second Restoration Application filed by the petitioner seeking restoration of Restoration Application No. 1 of 2023 which in turn sought restoration of Second Appeal No. 1172 of 2018 - non-appearance of the petitioner s advocate before the Tribunal due to being occupied in High Court proceedings and other work commitments - HELD THAT - It appears that the Tribunal ought not to have rejected the Restoration Application No. 12 of 2023 on the ground that the matter is pending for ten years and the applicant has not paid any amount towards tax demand. The Tribunal should have considered the facts of the case to grant the relief to the petitioners for benefit of production of Form-F in accordance with law so as to grant relief during the course of hearing of Second Appeal No. 1172 of 2018. The matter is pending before the Tribunal prior to 2018 and still pending for adjudication and therefore the Tribunal should not have dismissed the restoration application on that ground of pendency of the litigation. Conclusion - The Tribunal ought not to have rejected the Restoration Application No. 12 of 2023 on the ground that the matter is pending for ten years and the applicant has not paid any amount towards tax demand. This petition is disposed off by imposing a cost of Rs.25, 000/- on the petitioner to be deposited with the Tribunal within a period of two weeks from the date of receipt of a copy of this order and on that condition the impugned order of the Tribunal dated 21/08/2023 passed in Restoration Application No. 12 of 2023 is quashed and set aside and Restoration Application No. 1 of 2023 in Second Appeal No. 1172 of 2018 is ordered to be restored to file.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court in this matter are:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Legality of the Tribunal's rejection of Restoration Application No. 12 of 2023 Relevant legal framework and precedents: The restoration of appeals and applications before tribunals is governed by principles of natural justice and procedural fairness, allowing restoration where sufficient cause is shown for non-appearance or delay. Courts and tribunals have discretion to restore appeals if the applicant demonstrates a bona fide reason for non-prosecution, provided the delay is not inordinate or in bad faith. Court's interpretation and reasoning: The Court noted that the Tribunal rejected the restoration application primarily on two grounds: the pendency of litigation for over ten years and non-payment of any amount towards the tax demand. The Court found such grounds insufficient to deny restoration, especially when the applicant had provided an explanation for non-appearance and sought restoration to enable production of Form-F declarations, which could materially affect the outcome. Key evidence and findings: The petitioner's advocate explained that absence was due to being engaged in other court proceedings and last-minute professional commitments, which was not deliberate or intentional. The petitioner also highlighted the receipt of Form-F declarations from interstate customers, which were crucial for the appeal. Application of law to facts: The Court applied the principle that restoration applications should be allowed when there is a reasonable explanation for non-appearance and when restoration would facilitate adjudication on merits. The pendency of litigation for a long period and non-payment of dues were not considered sufficient grounds to refuse restoration without considering substantive issues. Treatment of competing arguments: While the respondents argued that the applicant was merely delaying and avoiding payment, the Court emphasized the importance of allowing the appeal to be heard on merits, especially when procedural lapses were explained and not deliberate. Conclusions: The Court concluded that the Tribunal erred in rejecting the restoration application solely on the grounds stated and that the matter deserved restoration to enable proper adjudication. Issue 2: Sufficiency of explanation for non-appearance and procedural compliance Relevant legal framework and precedents: Non-appearance before a tribunal or court, if explained satisfactorily and without mala fide intent, generally warrants restoration of the appeal or application. Courts have recognized professional engagements and unforeseen circumstances as valid reasons for absence. Court's interpretation and reasoning: The Court accepted the petitioner's explanation that the advocate was occupied in the High Court and that the colleague who regularly handled the matter had become an Additional Government Pleader, necessitating reliance on another colleague who was unavailable on the hearing date. The Court found the explanation credible and not indicative of negligence or willful default. Key evidence and findings: The restoration application itself detailed the reasons for non-appearance, emphasizing the last-minute rush before court vacation and the absence of the usual advocate due to changed professional roles. Application of law to facts: The Court applied the principle that procedural lapses caused by genuine professional commitments should not result in dismissal of appeals, especially when restoration applications are promptly filed. Treatment of competing arguments: The respondents contended that the applicant was negligent, but the Court found no evidence of intentional default. Conclusions: The explanation for non-appearance was sufficient to justify restoration. Issue 3: Consideration of substantive rights and production of Form-F declarations Relevant legal framework and precedents: Form-F declarations under the Central Sales Tax Act are significant for claiming inter-state sales rebates and can materially affect tax liability. Courts have held that procedural dismissals should not preclude parties from presenting crucial evidence impacting substantive rights. Court's interpretation and reasoning: The Court noted that the petitioner sought restoration to present Form-F declarations received from interstate customers, which were not earlier on record. The Court emphasized that the Tribunal should have allowed restoration to enable consideration of these declarations, which could substantially affect the tax demand. Key evidence and findings: The petitioner's submissions and restoration application indicated that the Form-F declarations were newly received and essential for the appeal's adjudication. Application of law to facts: The Court applied the principle that restoration applications should be granted if they enable the presentation of relevant evidence that could influence the outcome. Treatment of competing arguments: The respondents argued the delay was a tactic to avoid payment, but the Court prioritized the petitioner's right to present material evidence. Conclusions: Restoration was necessary to allow the petitioner to place Form-F declarations on record and have the appeal adjudicated on merits. Issue 4: Discretionary imposition of costs and restoration of appeals Relevant legal framework and precedents: Courts and tribunals have discretion to impose costs when allowing restoration applications to balance the interests of justice and discourage casual or negligent conduct. Court's interpretation and reasoning: While allowing restoration, the Court imposed a cost of Rs. 25,000 on the petitioner to be deposited with the Tribunal within two weeks. This was intended to ensure seriousness and compensate for procedural lapses. Application of law to facts: The Court exercised its discretion to impose costs as a condition precedent to restoration, recognizing the need to balance procedural discipline with substantive justice. Conclusions: The imposition of costs was appropriate and proportionate to the circumstances. 3. SIGNIFICANT HOLDINGS "The Tribunal ought not to have rejected the Restoration Application No. 12 of 2023 on the ground that the matter is pending for ten years and the applicant has not paid any amount towards tax demand. The Tribunal should have considered the facts of the case to grant the relief to the petitioners for benefit of production of Form-F in accordance with law so as to grant relief during the course of hearing of Second Appeal No. 1172 of 2018." "The explanation that the advocate could not attend the Tribunal being occupied in the Hon'ble Gujarat High Court and due to other work commitments, and that the issue entirely slipped out of mind in the last hour rush, was not purposeful or with the slightest intent to not appear before the Tribunal." "The matter is pending before the Tribunal prior to 2018 and still pending for adjudication and therefore, the Tribunal should not have dismissed the restoration application on that ground of pendency of the litigation." Core principles established include:
Final determinations:
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