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TMI Blog2010 (1) TMI 1311X X X X Extracts X X X X X X X X Extracts X X X X ..... t found due under the order of assessment and demand with interest and penalty within one month from the date of the order. Both these petitions involve identical issues based on common facts between the same parties, as such they were heard together and are being disposed of by this common judgment. The factual matrix is borrowed from W.P. No. 4176/2008. Factual Matrix: 3. The petitioners are an Export Oriented Unit (EOU), inter alia; engaged in export of diamond studded jewellery out of India. The petitioners, in the course of business, have imported in the limits of Navi Mumbai Municipal Corporation diamonds and coloured stones since they are engaged in business of studding of diamonds and colour stones in the jewellery and exporting such diamond studded jewellery out of India. According to the petitioners, they do not carry out any process on the diamonds brought in the limits of Municipal Corporation except studding it into the jewellery, as such diamonds imported in the city are not subjected to levy cess of octroi under the provisions of the Bombay Provincial Municipal Corporations Act, 1949 ("Act" for short). 4. Respondent No. 1 is the State of Maharashtra, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with application seeking stay of the operation of the order dated 10th August, 2007 and praying for waiver of pre-deposit with interest and penalty. The learned Civil Judge, after hearing the parties, vide his order dated 11th January, 2008, rejected prayer for stay made by the petitioners and directed them to deposit entire amount of cess, interest and penalty in compliance with the provision of Section 406(2)(c) of the Act. 9. Being aggrieved by the aforesaid order, petitioners have invoked writ jurisdiction of this Court under Article 227 of the Constitution of India. Rival Submissions: 10. At the outset, Mr. Baya, learned Counsel appearing for the petitioners submits that the entire amount of disputed tax has already been paid by the petitioners since Section 406(2)(c) mandates deposit of the disputed tax as a pre-condition for hearing and determining the appeal. According to him, the term "tax" has been defined under Section 127 of the Act. It provides for imposition of various taxes under the Act; one of them being "cess" as enumerated in Clause (aa) of Sub-section (2) of Section 127, as such cess by way of octroi; has been deposited by them. 11. Mr. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand is a condition precedent for entertaining the appeal preferred by the petitioners. He submits that the appeal cannot be entertained unless amount demanded in the notice of demand is deposited by the petitioners. He further submits that there is no power in the learned Judge to stay operation and execution of the impugned order or to dispense with pre-deposit in toto. He placed reliance on the judgment of the learned single of this Court dated 6th July, 2007 in the matter of Navi Mumbai Municipal Corporation v. Pan India Infravest Pvt. Ltd. Writ Petition No. 4183/2004 (unreported) in support of his submission. Consideration: 15. Having heard rival parties, it is not in dispute that recovery of the cess by the Corporation under Chapter XI-A of the Act is a tax under Section 152-A of the said Act in lieu of octroi. Clause (e) of Sub-section (2) of Section 406 of the Act reads as under: 406. Appeals when and to whom to lie. (1)... ... ... (2) No such appeal shall be entertained unless (a)... ... ... (b)... ... ... (c)... ... ... (d)... ... ... (e) in the case of an appeal against a tax, or in the case of an appeal made against a rateable value the amount of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "including interest and penalty imposed" in Clause (c) of Sub-section (2) thereof after the words "any tax". 20. The unamended Clause (c) together amended Clause (c) of Sub-section (2) of Section 406 are reproduced side by side for comparison: Unamended clause (c) Amended clause (c) (c) in the case of an appeal against any tax in respect of which provision exists under act for a complaint to be made to the commissioner against the demand, such complaint has previously been made and disposed of (c) in the case of an appeal against any tax including interest and penalty imposed in respect of which provision exists under this act for a complaint to be made to the commissioner against the demand, such complaint has previously been made and disposed of (Emphasis supplied) Comparison of the aforesaid provision would demonstrate that Legislature tried to include interest and penalty in the concept of tax with effect from 3rd October, 2008. However, the consequential amendment which was expected in Clause (e) has not been done. With the result, the petitioners are justified in contending that what is required to be deposited by way of pre-deposit is only the amou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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