1988 (2) TMI 458

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..... eard on merits on payment of 10 per cent of additional demand and 50 per cent of the penalty?" 2.. The material facts giving rise to this reference briefly are as follows: While framing assessment of the assessee for the period from 4th November, 1975 to 23rd October, 1976, the Sales Tax Officer rejected the books of account and made a best judgment assessment. After adjusting the amount of tax paid by the assessee, the assessee was held liable to pay Rs. 4,04,207. This sum consisted of tax amounting to Rs. 3,02,286 and penalty amounting to Rs. 1,00,000. The assessee preferred an appeal before the Appellate Deputy Commissioner who held that as the amount deposited by the assessee was not as required by the provisions of section 38(3) of t .....

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..... behalf of the parties, it would be useful to refer to the relevant provisions of section 38(3) of the Act in force on 27th April, 1979, when the appeal was filed. These provisions are as follows: "(3) No first or second appeal against an order of assessment, with or without penalty or against an order imposing penalty, shall be admitted by the appellate authority unless out of the total balance due from the dealer: (a) where all the returns for the period to which the order appealed against relates, have been filed and tax payable according to such returns has been paid one-tenth of such balance; (b) where one or more of returns for the period to which the order appealed against relates, have not been filed and tax has not been paid .....

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..... Tribunal was not justified in holding that the appeal before the Appellate Deputy Commissioner could not be summarily rejected. 4.. Having given our conscious consideration to the matter, we are of the opinion that the Tribunal failed to appreciate that whenever an appeal was preferred from an order imposing penalty, the appellant was required to pay one half of the total balance due from the appellant. The expression "such balance" occurring in section 38(3)(c) has reference to "the total balance due" from the dealer as specified in section 38(3). The assessee, in the instant case, had preferred appeal against an order of assessment whereby penalty was also imposed under section 43 of the Act. Clause (c) of section 38(3) was, therefore, .....

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