Satisfactory proof of tax payment can validate a sales tax appeal even without a challan at filing stage.

An appeal under section 9 of the Uttar Pradesh Sales Tax Act, 1948 could not be refused merely because the memorandum was not accompanied by the challan of admitted tax, where the tax had already been paid within time and satisfactory proof was produced before the appeal was taken up for consideration. The requirement that the appeal be "entertained" only on proof of payment was construed to apply at the stage of consideration, not filing. Rule 66(2) of the U.P. Sales Tax Rules, 1948 was held directory, not mandatory, because it prescribed the challan as one mode of proof but did not exclude other equally satisfactory evidence, such as a certificate of payment.

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Issues: (i) Whether an appeal against assessment under section 9 of the Uttar Pradesh Sales Tax Act, 1948 could be refused admission merely because the memorandum of appeal was not accompanied by the challan of admitted tax payment, although the tax had in fact been deposited within time and proof was produced before the appeal was considered. (ii) Whether rule 66(2) of the U.P. Sales Tax Rules, 1948 was mandatory so as to exclude every other mode of proof of payment, or merely directory as prescribing one accepted mode of compliance.

Issue (i): Whether an appeal against assessment under section 9 of the Uttar Pradesh Sales Tax Act, 1948 could be refused admission merely because the memorandum of appeal was not accompanied by the challan of admitted tax payment, although the tax had in fact been deposited within time and proof was produced before the appeal was considered.

Analysis: The proviso to section 9 required that an appeal should not be entertained unless accompanied by satisfactory proof of payment of the admitted tax. The expression "entertained" was construed to mean the stage when the appeal is taken up for consideration, not merely when it is filed. Since the admitted tax had already been paid within time and a certificate of payment was available before the appeal was considered, the statutory condition was satisfied.

Conclusion: The appeal could not be rejected on the ground of absence of the challan at the time of filing, and the assessee was entitled to have the appeal heard.

Issue (ii): Whether rule 66(2) of the U.P. Sales Tax Rules, 1948 was mandatory so as to exclude every other mode of proof of payment, or merely directory as prescribing one accepted mode of compliance.

Analysis: Section 9 required only satisfactory proof of payment, while rule 66(2) prescribed the challan as one convenient and uncontestable mode of proving such payment. The rule did not curtail the section or exclude other equally satisfactory proof. Procedural rules were meant to advance justice and not defeat it, and a certificate from the Sales Tax Officer was treated as adequate proof of payment.

Conclusion: Rule 66(2) was directory, not mandatory, and the certificate of payment was sufficient compliance with section 9.

Final Conclusion: The rejection of the appeal by the Assistant Commissioner was unsustainable, and the matter had to go back for disposal on merits in accordance with law.

Ratio Decidendi: Where a taxing statute requires an appeal to be entertained only on satisfactory proof of payment of admitted tax, the requirement is met if such proof exists when the appeal is taken up for consideration; a procedural rule prescribing one mode of proof does not exclude other equally satisfactory modes unless the statute clearly says so.

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