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TMI Blog2023 (6) TMI 751X X X X Extracts X X X X X X X X Extracts X X X X ..... n payment of interest by the assessee, necessarily are composite orders. Thus, the basis for any demand for interest is primarily the liability to pay tax. Hence both the orders namely the direction to pay tax and the direction to pay the interest, are interconnected and become part of a common order, which is an appealable order. It is rightly contended by the petitioner that an appeal against such composite order would necessarily include within its ambit appealability of the orders pertaining to the interest. Such composite orders are appealable orders under the provisions of sub-section (6A) and (6B) of Section 26. As a corollary the provisions of sub-section (6C) would become applicable in so far as such appeals as provided under sub-sections (6A) and (6B) are concerned, namely an entitlement of the assessee to seek stay of the recovery of the disputed dues including on interest. The legislature itself has avoided to provide anything in regard to an order on interest to be kept away from the purview of such appeals which the assessee would file under either sub-section (6A) or (6B) of Section 26. Thus to read any bar to appealability in regard to an order on interest, fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cording to the petitioner, is akin to the order passed by the assessing officer. The Supreme Court observed that an order under Section 7A of the Employees P.F. Act is an order that determines the liability of the employer under the provisions of the Act and while determining the liability, the competent authority offers an opportunity of hearing to the concerned establishment - The Supreme Court observed that such an order shall be amenable to appeal under Section 7I of the Employees P.F. Act, and the same is true of any composite order a facet of which is amenable to appeal under Section 7I of the Employees P.F. Act. It was observed that if for some reason when the authority chooses to pass an independent order under Section 7Q, the same would not be appealable. Respondent s (Revenue's) contention that the provisions of Section 85(2)(b-3) be read with the provisions of Section 26(6A) and (6B) of the Act, cannot be accepted. If such an interpretation is accepted, it would certainly lead to an absurdity. The tribunal directed to consider the petitioner s stay application qua the challenge to the interest component - petition allowed. - WRIT PETITION NO. 319 OF 2020 - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pproached the tribunal in a second appeal (VAT Second Appeal No. 1109 of 2018), in which the stay application in question was filed by the petitioner, on which the impugned order has been passed. 4. The grievance of the petitioner is in regard to the tribunal holding that the petitioner s appeal qua the challenge to the demand of interest as ordered by the first appellate authority, in terms of what Section 30(2) of the Act would provide, itself being not maintainable and the petitioner s stay application qua the order on interest, accordingly being rejected. It is the petitioner s contention that the tribunal has not considered and/or has overlooked that the order impugned before it was not merely an order under Section 30(2), however, it was a composite order passed by the appellate authority. It is submitted that the subject matter of the first appeal was the assessment order passed by the assessing authority under Section 23 of the Act, which itself was a composite order, from which an appeal was filed by the petitioner before the first appellate authority as per provisions of sub-section (6A) of Section 26 of the Act. 5. The petitioner has contended that once the nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other hand, Mr. Sonapal, learned counsel for respondent nos.1 to 3 has opposed this petition. It is his contention that Section 85 (2)(b-3) clearly creates a bar to the maintainability of any appeal against an order passed under sub-sections (2) or (4) of Section 30 directing payment of interest. He submits that once such specific provision is incorporated, no fault can be found in the view as taken by the tribunal in paragraph 6 of the impugned order, that an order passed under Section 30(2) of the Act is not an appealable order, hence, the petitioner s appeal against an order of interest passed under Section 30(2) of the Act was not maintainable. It is his submission that for such reason, there was no question of any stay to an order directing payment of interest under Section 30(2) of the Act. It is hence submitted that the petition is misconceived and needs to be dismissed. 8. We have heard the learned counsel for the parties. We have also perused the orders passed by the assessing officer, the first appellate authority, as also the impugned order passed by the tribunal on the second appeal and the record. 9. The short issue which falls for our consideration is whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irst appeal and the second appeal) shall have the following powers, namely :- (a) in an appeal against an order of assessment, it may confirm, reduce, enhance or annul the assessment: Provided that, where the appeal is filed before the Tribunal, the Tribunal may set aside the assessment and refer the case back to the assessing authority for making a fresh assessment in accordance with the direction given by it and after making such further inquiry as may be necessary; the assessing authority shall thereupon proceed to make such fresh assessment and determine, where necessary, the amount of tax payable on the basis of such fresh assessment; [Provided further that, in respect of any appeal against an order of assessment, wherein dealer was not able to attend or remain present before the assessing authority at the time of hearing when the assessment order had been passed, then the appellate authority in first appeal may set-aside the said assessment order,- (i) within nine months from the commencement of the Maharashtra Tax Laws (Levy, Amendment and Validation) Act, 2017 (Mah. XXXI of 2017), if the appeal is filed prior to the date of commencement of the said A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Explanation For the purpose of computing payment in the appeal, mentioned in the above clauses, the amount of part payment made earlier, if any, shall be included:] [Provided further that] if at the request of the appellant, the appellate authority or the Tribunal has granted three adjournments or the appellant fails to attend on the date fixed for hearing by the appellate authority or the Tribunal on three occasions, whether consecutive or not then,- (a) (i) the stay, if any, shall not be continued unless an amount equal to fifteen per cent of the amount so disputed in appeal or rupees fifteen crore, whichever is less is paid into the Government Treasury within the time mentioned in the order by the appellate authority or the Tribunal for this purpose. Explanation .- The amount of fifteen per cent or rupees fifteen crore referred to above shall be inclusive of any part payment made earlier towards the disputed amount; (ii) if the appellant fails to pay the amount so enhanced, within such time as mentioned in the order by the appellate authority or Tribunal, the amount in dispute shall be recoverable and all orders to the contrary shall stand vac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovided in the proviso to sub-section (6), (b) in case of an appeal against an order, which involves disallowance of claims as stated in clause (a) above and also tax liability on other grounds, then, an amount equal to 10 per cent. of the balance amount of disputed tax, so far as such tax liability pertains to tax, on grounds, other than those mentioned in clause (a), (c) in case of an appeal against an order, other than an order, described in clauses (a) and (b) above, an amount equal to 10 per cent. of the balance amount of disputed tax, (d) in case of an appeal against any other order, an amount, as directed by the Tribunal : Provided that, the amount required to be deposited under clause (b) or, as the case may be, clause (c), shall not exceed rupees fifteen crores. Explanation .- For the purposes of clause (b) or clause (c) of sub-section (6B), the expression, balance amount of disputed tax shall mean an amount of disputed tax which remains outstanding, after considering the amount paid, as directed by the appellate authority in first appeal under clause (b) or, as the case may be, clause (c), respectively of sub-section (6A). (6C) The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under this sub-section shall not exceed the amount of tax found payable for the respective year. (2) A registered dealer who has failed to pay the tax within the time specified by or under this Act, shall be liable to pay by way of simple interest, in addition to the amount of such tax a sum calculated at the prescribed rate on the amount of such tax for each month or part thereof after the last date by which he should have paid such tax: Provided that, in relation to the tax payable according to [the return, fresh return or as the case may be], revised return, the said dealer shall, notwithstanding anything contained in any other provision of this Act, be deemed not to have paid the amount of such tax within the time he is required by or under the provisions of this Act to pay it if he has not paid the full amount of such tax on or before the last date prescribed for furnishing of such return and accordingly, if he has not paid the full amount of such tax or has paid only the part of the amount of such tax by such date, he shall be liable under this clause for payment of interest after such date on the full or part, as the case may be, of the amount of tax which has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e date of such order from the said date next. [(4) If, - (a) after the commencement of,- (i) audit of the business of the dealer in respect of any period, or (ii) inspection of the accounts, registers and documents pertaining to any period, kept at any place of business of the dealer, or (iii) entry and search of any place of business or any other place where the dealer has kept his accounts, registers, documents pertaining to any period or stock of goods, (b) in consequence of any intimation issued under sub-section (7) of section 63, The dealer files one or more returns or, as the case may be, revised returns in respect of the said period, then he shall be liable to pay by way of interest, in addition to the amount of tax, if any, payable as per the return or, as the case may be, revised return, a sum equal to 25 per cent, of the additional tax payable as per the return or, as the case may be, revised return.] [Provided that, interest under this sub-section shall not be payable on account of the additional tax liability arising due to non-production of declarations or, as the case may be, certificates: Provided further that, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aining to the seizure or retention of books of accounts, registers and other documents, or [* * *] (g) any order or assignment under section 59, or [* * *] (i) an interim order issued in the course of any proceeding not being an order issued under sub-section (6) of [section 26, or]. [(j) any order, published by the Commissioner, by virtue of the powers conferred on him by notification issued under section 26B.] (emphasis supplied) 12. The scheme of the Act, in so far as assessment is concerned, is quite clear. Section 23 makes a provision for assessment inter alia in regard to a registered dealer who fails to file a return in respect of any period, by the prescribed date, and the procedure required to be followed by the revenue in the circumstances as specified, so as to bring about the assessment of such dealer. Section 23 is followed by Section 24 which provides for rectification of mistakes, Section 25 provides for review of the orders passed by any officer under the Act. Section 26 provides for a remedy of appeal(s). In the present context, the relevant provisions being sub-section (6A), (6B) and (6C) of Section 26. On a plain reading o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omposite order passed by the assessing authority or by the first appellate authority, to be read in sub-section (6B) sub-section (6C) would be reading something into such provisions, which has not been expressly provided by the legislature. If such interpretation as canvassed on behalf of the respondents is accepted, necessarily on every occasion, the assessing officer would be required to pass independent orders on the assessment and a separate order in regard to interest and the same would also be the position before the first appellate authority, that no composite order can be passed. Such eventuality is quite unknown, except in a situation, where the adjudication in a given case is simplicitor only on interest, when the basic liability of tax, would stand crystalised either under judicial orders or otherwise. We are of the clear opinion that it is not the intention of the legislature that a composite order cannot be passed either by the assessing authority or by the first appellate authority. In any event, it is quite possible that in a given situation, the order passed under Section 30(2) of the Act levying interest on the assessee, itself would fall to the ground, in view of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an order that determines the liability of the employer under the provisions of the Act and while determining the liability, the competent authority offers an opportunity of hearing to the concerned establishment. It was observed that at that stage, the delay in payment of the dues and component of interest are determined and such an order becomes a composite order being an order passed under Section 7A and 7Q together. The Supreme Court observed that such an order shall be amenable to appeal under Section 7I of the Employees P.F. Act, and the same is true of any composite order a facet of which is amenable to appeal under Section 7I of the Employees P.F. Act. It was observed that if for some reason when the authority chooses to pass an independent order under Section 7Q, the same would not be appealable. In our opinion, the observations of the Supreme Court squarely applies in the present context, considering the provisions of the act in question. It would be appropriate to note the observations of the Supreme Court which reads thus:- 18. At this stage, it is necessary to clarify the position of law which do arise in certain situations. The competent authority under the Ac ..... 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