Delhi High Court
Chetna Polycots (P) Ltd. vs Appellate Tribunal, Sales Tax And ... on 10 May, 1994
Bench: D Jain, D Wadhwa
JUDGMENT
1. By this petition under article 226 of the Constitution of India the petitioner-company seeks a writ of certiorari, for quashing the order dated March 25, 1994, passed by the Sales Tax Appellate Tribunal, upholding the order dated February 28, 1994, passed by the Deputy Commissioner (Appeals-II), New Delhi, dismissing petitioner's appeal in liming for failure on its part to comply with its order dated September 30, 1993, under section 43(5) of the Delhi Sales Tax Act, 1975 (for short "the Act"). Yet another direction is sought to the respondents to hear the appeal of the petitioner on merits and extend the time for complying with the aforesaid order of pre-deposit by permitting the petitioner to pay Rs. 1 lakh and furnish security for the balance deposit amount.
2. On completion of assessment for the assessment year 1988-89, an additional demand of Rs. 4,61,295 was created under the Act. The company preferred an appeal under section 43 of the Act without making payment of said additional demand. The first appellate authority, in exercise of its powers under the first proviso to section 43(5) of the Act, vide order dated September 30, 1993, directed the petitioner to deposit a sum of Rs. 2,50,000 on or before October 18, 1993, as condition precedent to the entertainment of the appeal. Proof of this payment was to be furnished on October 19, 1993. Admittedly the said order was neither challenged nor complied with. On account of change in jurisdiction of the first appellate authority, petitioner's appeal was fixed for hearing on February 21, 1994, for which a registered notice was sent to it but was received back unserved with the report that there was no such firm existing at the said address. Finding that there was no proof of payment in terms of order dated September 30, 1993, the Deputy Commissioner (Appeals-II) dismissed the petitioner's appeal in liming.
3. The petitioner took the matter in further appeal to the Sales Tax Appellate Tribunal. The Tribunal vide its order dated March 25, 1994, held that on account of non-compliance of the condition imposed under section 43 of the Act, the first appellate authority was justified in dismissing petitioner's appeal in liming. The Tribunal also declined to go into the merits of the assessment made as the appeal had been dismissed by the first appellate authority in liming. Hence the present petition.
4. Mr. Rajiv Nayar, learned counsel for the petitioner, has urged before us that both the authorities below have failed to appreciate the acute financial constraints and the genuine hardship of the petitioner-company which prevented it from complying with the condition of pre-deposit as directed by the Deputy Commissioner (Appeals-II). He submitted that the Tribunal should have taken a lenient view in the matter by accepting petitioner's offer to deposit Rs. 1 lakh in cash with security for the balance amount. His contention, is that the lower authorities have failed to exercise the jurisdiction vested in them and thus deprived the petitioner of its statutory right of appeal.
5. We do not agree. Sub-section (5) of section 43 of the Act clearly provides that no appeal against an order of assessment shall be entertained by the appellate authority unless such appeal is accompanied by a satisfactory proof of payment of tax in respect of which an appeal has been preferred. The first proviso to the said sub-section, however, confers power on the appellate authority to entertain an appeal without payment of tax or on payment of a smaller amount of tax if it thinks fit for the reasons to be recorded in writing. It is under this proviso that in the present case the first appellate authority, vide its order dated September 30, 1993, had directed the petitioner to deposit a sum of Rs. 2.5 lakhs on or before October 18, 1993 to enable it to entertain its appeal. As noted above, admittedly, the validity of the order dated September 30, 1993, was not questioned by the petitioner in any appeal nor was any extension of time for making the requisite deposit sought. Thus the order dated September 30, 1993, requiring the petitioner to deposit Rs. 2.5 lakhs by October 18, 1993, attained finality. From a plain reading of section 43(5) of the Act it is evident that it is mandatory in nature and, therefore, on petitioner's failure to make the requisite deposit as directed under proviso to the said sub-section on or before October 18, 1993, its appeal was rendered incompetent and could not be entertained by the appellate authority. No fault could, therefore, be found with the order of the first appellate authority dismissing the appeal of the petitioner in liming and the Tribunal rightly held so vide its order dated March 25, 1994.
6. There is not ground for us to interfere in the matter. Dismissed.
7. Writ petition dismissed.
