Madras High Court
The Commercial Tax Officer vs M/S.Acme Fitness Pvt. Ltd on 24 February, 2021
WA.No.479 of 2021
In the High Court of Judicature at Madras
Dated : 24.2.2021
Coram :
The Honourable Mr.Justice T.S.SIVAGNANAM
and
The Honourable Ms.Justice R.N.MANJULA
Writ Appeal No.479 of 2021 and CMP.No.1895 of 2021
The Commercial Tax Officer
GD-II, Commercial Taxes
Department, Pudhucherry-5. ...Appellant
Vs
1.M/s.Acme Fitness Pvt. Ltd.,
Puducherry-4.
2.The Branch Manager, HDFC
Bank Ltd., Vadapalani,
Chennai-26. ...Respondents
APPEAL under Clause 15 of the Letters Patent against the order
dated 23.12.2020 made in W.P.No.19775 of 2020.
For Appellant : Ms.V.Usha, AGP (P)
Judgment was delivered by T.S.SIVAGNANAM,J
We have elaborately heard Ms.V.Usha, learned Additional
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WA.No.479 of 2021
Government Pleader (Puducherry) appearing for the appellant.
2. This appeal filed by the Commercial Tax Department,
Puducherry is directed against the order dated 23.12.2020 made in
W.P.No.19775 of 2020.
3. In the said writ petition, the first respondent herein challenged
the attachment notice dated 27.11.2020 for recovery of the sales tax
payable to the appellant herein.
4. The first respondent - dealer contended that the coercive
action initiated by the appellant was premature, as the order passed
by the First Appellate Authority dated 09.11.2020 was served upon the
first respondent only on 21.11.2020, that the time limit for filing the
appeal before the Sales Tax Appellate Tribunal was 60 days i.e
20.1.2021 and that within that period, the appellant ought not to have
issued the recovery notice.
5. The appellant, before the learned Single Judge as well as
before us, represented by the learned Additional Government Pleader
(Puducherry), would submit that the provisions of Section 49 of the
Puducherry Value Added Tax Act, 2007 (for short, the PVAT Act) did
not provide for grant of time to the first respondent – dealer to make
payment of the disputed tax and as such, the entire demand, as
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WA.No.479 of 2021
confirmed by the First Appellate Authority, became payable
immediately upon service of the order.
6. The learned Single Judge considered the matter and rejected
the submission of the appellant – Department to the effect that the
entire tax demanded became payable immediately upon dismissal of
the appeal by the First Appellate Authority.
7. In our considered view, the observation made by the learned
Single Judge is perfectly right and justified. The appeal remedy
granted under Section 49 of the Act is a statutory remedy and a
valuable right to the first respondent – dealer. The said right cannot be
frustrated by initiating recovery proceedings even before the appeal
time is over. Probably, the appellant may be right in respect of the
period beyond the first 60 days, as the condonation of delay beyond
the period of 60 days is not automatic and is only at the discretion of
the Appellate Tribunal. Therefore, if recovery proceedings are to be
initiated before the expiry of the period of limitation of 60 days for
filing an appeal before the Appellate Tribunal, it would frustrate the
entire proceedings and would amount to interfering with the statutory
right conferred on the first respondent – dealer under the provisions of
the Act. We are also of the considered view that the learned Single
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WA.No.479 of 2021
Judge was right in allowing the said writ petition.
8. Ms.V.Usha, learned Additional Government Pleader points out
that on the date when the said writ petition was filed, the period of six
months was over.
9. In our opinion, that may not be crucial test, but what would
be relevant is as to whether the recovery notice was issued prior to the
expiry of 60 days period. In the instant case, the first respondent –
dealer would state that the order passed by the First Appellate
Authority dated 09.11.2020 was served on them only on 21.11.2020,
that the 60 days period would expire only on 20.1.2021 and that the
order of attachment was issued on 27.11.2020, which was well within
the period of 60 days period. Hence, the learned Single Judge was
right in quashing the attachment notice. However, if the first
respondent – dealer has not filed any appeal as on date or if the first
respondent filed an appeal before the Tribunal, but has not been
successful in obtaining interim orders from the Tribunal, then it will be
open to the appellant to initiate steps for recovery of tax and penalty
as determined by the Assessing Officer and as confirmed by the First
Appellate Authority.
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WA.No.479 of 2021
10. The learned Additional Government Pleader, on instructions
from the Department, would submit that till date, the first respondent
– dealer has not preferred any appeal.
11. If that be so, the appellant shall verify from the Tribunal and
after verification if it is found that no appeal has been filed against the
order passed by the First Appellate Authority, then it will be open to
the appellant to proceed further in accordance with law.
12. With the above observation, the writ appeal is dismissed.
Consequently, the connected CMP is also dismissed.
24.2.2021
To
The Branch Manager, HDFC Bank Ltd., Vadapalani, Chennai-26
RS
https://www.mhc.tn.gov.in/judis/
WA.No.479 of 2021
T.S.SIVAGNANAM,J
AND
R.N.MANJULA,J
RS
WA.No.479 of 2021 &
CMP.No.1895 of 2021
24.2.2021
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