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Issues: Whether a cheque delivered along with an appeal constitutes valid payment of admitted tax, and whether an appeal can be dismissed for non-payment when the cheque is dishonoured because of a mistake attributable to the department.
Analysis: Rule 48 permits payment by cheque. When a cheque is accepted, payment is treated as made on delivery of the cheque and not on its encashment, provided the cheque is not dishonoured for reasons attributable to the assessee. If the dishonour results from a faulty endorsement or other mistake of the department, the assessee cannot be penalised by treating the admitted tax as unpaid. In the absence of a clear finding that the dishonour was due to the assessee's fault, dismissal of the appeal for non-payment of admitted tax was not justified.
Conclusion: The cheque was to be treated as valid payment of the admitted tax if it was dishonoured due to a departmental mistake, and the assessee was deemed to have deposited the admitted tax on filing the appeal in such a case.
Ratio Decidendi: A cheque tendered in payment of admitted tax is effective on delivery where the governing rules permit payment by cheque, and the assessee cannot be denied the benefit of such payment when dishonour is attributable to the department rather than to the assessee.
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