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TMI Blog2016 (7) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... licant : Pradeeo Agrawal For the Opposite Party : C.S.C ORDER Trade Tax Revision No. 67 of 2016 has been filed under Section 58 of the VAT Act, 2008 against the judgment and order dated 04.05.2016 passed by the learned Commercial Tax Tribunal, Lucknow in Appeal No. 141 of 2016. The question of law involved in this revision is as under:- Whether the impugned judgment of the tribunal can be sustained in the light of the parameteters laid down by the Supreme Court in a catena of decisions viz. (2009) 3 SCC 177; Pennar Industries Ltd. vs. State of Andhra Pradesh and others; (2006) 13 SCC 347; Benara Valves Ltd. And others vs. commissioner of Central Excise and Another; (1985) 1 SCC 260; Assistant Collelctor v. Dunlop India Ltd. ors., etc. for considering interim relief matters ? The contention of the revisionist in nut shell is that both the first appellate authority and the learned Tribunal have failed to apply their mind to the relevant parameters while considering the application for interim relief and have declined a complete stay on the disputed tax-liability mechanically. Learned counsel for the revisionist relied upon the following judicial pronounceme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddition to aforesaid in sub section 6 of Section 55 of the VAT Act, 2008 the Appellate Authority has been vested with the power of staying the realization of disputed amount of tax, fee or penalty payable by the appellant till the disposal of the appeal, provided that-(i) where an order under appeal involves dispute about tax, fee or penalty, no stay order shall remain in force after thirty days from the date on which the same has been granted, if the appellant does not furnish security to the satisfaction of the assessing authority for payment of the amount, the realization whereof has been stayed within the aforesaid period of thirty days; (ii) no such application shall be entertained unless it is filed along with the memorandum of appeal under sub-section (1). Against the order of the First Appellate Authority there is a provision for filing an appeal before the learned Tribunal under Section 57(4) of the VAT Tax Act, 2008. Under sub section 9 thereof the Tribunal is empowered to stay the operation of the order appealed against or the recovery of the disputed amount of any tax, fee or penalty payable, or refund of the amount due, or proceeding for re-assessment under the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... े समक्ष सुनवाई की गई 1 अपीलकर्ता की तरफ से बताया गया कि बिना किसी आधार के अत्यधिक कर का आरोपित किया गया है . आर्थिक स्थिति ठीक नहीं है . शतप्रतिशत स्थगन की मांग की गई 1 विभाग की तरफ से स्थगन का विरोध è ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Merely saying that considering the arguments of learned counsel and facts in totality 60% of the disputed tax liability shall remain stayed does not by any cannon of judicial discipline satisfy the requirement of adherence to the principles laid down by the Supreme Court and this Court on the subject. When this order was challenged before the learned Tribunal it enhanced the interim protection to 85% of the disputed tax liability, however, again without any application of mind to the relevant factors, thereby, committing the same mistake which was committed by the First Appellate Authority. For convenience the order of the learned Tribunal passed on the same day i.e. 04.05.2016 is reproduced as under: निर्णय विचाराधीन अपीलें एडिशनल कमिश्नर ग्रेड - २ , ( अपील ) - प्रथम , वाडिज्य कर , लख ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #2357;ारा अपील आधार में उल्लिखित बिंदुओं को दोहराते हुए तर्क किया गया कि फर्म केंद्रीय सरकार का एक प्रतिष्ठान है . यह भी कहा गया कि फर्म द्वारा बेसिक फोन इंटरनेट तथा मोबाइल टेलीफोन सर्विस प्रोवाइडर & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 309;पीलकर्ता फर्म द्वारा शपथ पत्र दाखिल किये गए है . अंत में अनुरोध किया गया कि विवादित धनराशि का शत प्रतिशत स्थगन प्रदान किया जाये 1 विभाग कि ओर से श्री गिरीश चन्द्र असिस्टेंट कमिश्नर एवं राज्य प् ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 51;ालय इलाहाबाद द्वारा सर्व श्री ए . पी . इंटरप्राइजेज द्वारा इक़बाल सिंह बनाम कमिश्नर ऑफ़ कमर्शियल टैक्स एंड अदर्स ( वी . एस . टी . आई . २०१२ , वॉल्यूम १४ पृष्ठ बी .- ६७५ एवं माननीय उचतम न्यायालय द्वारा सर्व श् ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2408; , ३५२ . ८८ , रु . १ , ३६ , ७९ , ८७३ /- व रु . ७५ , ३७ , ३४८ /- के ८५ - ८५ प्रतिशत भाग का स्थगन किया जाना न्याय संगत एवं न्यायोचित है 1 अपीलकर्ता की अपीलें आंशिक रूप से स्वीकार किये जाने योग्य है 1 आदेश . द्वितीय अपील स . १ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 81;त प्रतिभूति प्रस्तुत न करने की दशा में पारित यह आदेश समाप्त समझा जायेगा . निर्णय की मूल प्रतिलिपि अपील स . १४१ / १६ की पत्रावली में तथा एक - एक प्रतिलिपि सम्बंधित पत्रवलिओं में रखी जाए 1 A bare perusal of the order passed by the learned Tribunal shows that it has m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to the legal principles--ex debito justitiae. Before any such order is passed the court must be satisfied that a strong prima facie case has been made out by the plaintiff including on the question of maintainability of the suit and the balance of convenience is in his favour and refusal of injunction would cause irreparable injury to him. In the case of Dalpat Kumar v. Prahlad Singh reported in (1992) 1 SCC 719, a Bench of two Hon'ble Judges observed in paragraph 6 as under:- ...... prima facie case , balance of convenience and irreparable loss are not rhetoric phrases for incantation, but words of width and elasticity, to meet myriad situations presented by men's ingenuity in given facts and circumstances, but always is hedged with sound exercise of judicial discretion to meet the ends of justice. ......the court would be circumspect before granting the injunction and look to the conduct of the party, the probable injury to either party and whether the plaintiff could be adequately compensated if junction is refused. The aforesaid decisions were considered and followed by the Supreme Court in a subsequent decision in the case of Mahadeo Savla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matters relating to grant or refuse to grant interim relief in proceedings other than suits also and there is no dispute in this regard. These observations of the Supreme Court should have been kept in mind by the Tribunal and the First Appellate Authority while passing the impugned order. A Bench of three Hon'ble Judges of the Supreme Court in the case of Assistant Collector of Central Excise vs. Dunlop India Ltd. And others reported in (1905) 1 SCC 260, also reiterated the aforesaid principles with reference to the earlier decisions rendered in Sri Samarias Trading Company Pvt. Ltd. v. S. Samuel and others reported in (1985) 2 SCR 24, Titagarh Paper Mills Co. Ltd. v. State of Orissa reported in (19983) 2 SCC 433, Union of India v. Oswal Woolen Mills Ltd. reported in (1984) 2 SCC 646 and Siliguri Municipality vs. Amlendu Das reported in (1981) 2 SCC 436. In the case of Siliguri Municipality (supra) the Calcutta High court had passed orders restraining the Siliguri Municipality from recovering a graduated consolidated rate on the annual value of buildings in terms of the amended provisions of the Bengal Municipal Act, which compelled the Supreme Court to observe that it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r considering the pros and cons of the matter lest larger public interest is not jeopardized and institutional embarrassment is eschewed . The court further went on to observe as under:- Even assuming that the company had established a prima facie case, about which we do not express any opinion, we do not think that it was sufficient justification for granting the interim orders as was done by High Court. There was no question of any balance of convenience being in favour of the respondent-company. The balance of convenience was certainly in favour of the Government of India. Governments are not run on mere Bank Guarantees. We notice that very often some courts act as if furnishing a Bank Guarantee would meet the ends of justice. No governmental business or for that matter no business of any kind can be run on mere Bank Guarantees. Liquid cash is necessary for the running of a Government as indeed any other enterprise. We consider that where matters of public revenue are concerned, it is of utmost importance to realise that interim orders ought not to be granted merely because prima facie case has been shown. More is required. The balance of convenience must be clearly in favo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the principle of prima facie case, balance of convenience, irreparable injury and other relevant factors discussed hereinabove. The order should disclose such application of mind. Cryptic observations as have been made in the present case, which have been noted in the earlier part of the judgment, do not satisfy these requirements. The passing of interim order in such a manner is highly objectionable. In Benara Valves Ltd. (supra) though, the Supreme Court was considering the language used in Section 35-F of the Central Excise Act wherein the word 'undue hardship to such person' and 'safeguard the interests of the Revenue' had been used but the observations made by it regarding 'undue hardship' should be kept in mind in other tax matters also. It opined that in Indian condition the expression 'undue hardship' is normally related to economic hardship. 'Undue hardship' means something which is not merited by the conduct of the claimant, or is very much disproportionate to it. 'Undue hardship' is caused when the hardship is not warranted by the circumstances. For a hardship to be 'undue' it must be shown that the particular bu ..... 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