Retrospective tax interest amendment could not bar appeal where admitted tax was paid before filing.

Interest later deemed part of tax under an amendment was held not to apply retrospectively to the assessment year in question, so it could not be treated as part of the admitted tax for appeal purposes. An appeal under the U.P. Sales Tax Act was required to satisfy the condition of prior deposit of admitted tax, and that condition was met where the tax had been paid before filing. Deposit of interest after filing did not defeat entertainability because the unamended law governed the relevant year and the right of appeal is a substantive right.

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Issues: (i) Whether interest payable under section 8(1-C) of the U.P. Sales Tax Act, 1948 formed part of the admitted tax for the purpose of section 9 of that Act. (ii) Whether an appeal could be said to be not entertainable merely because the interest was deposited after filing of the appeal, although the admitted tax had been deposited before filing.

Issue (i): Whether interest payable under section 8(1-C) of the U.P. Sales Tax Act, 1948 formed part of the admitted tax for the purpose of section 9 of that Act.

Analysis: The statutory scheme of section 9 required satisfactory proof of payment of the admitted tax before an appeal could be entertained, but the right of appeal is a vested substantive right and its incidents are governed by the law in force when the lis commenced. The amendment introducing section 8(1-C), which deems interest to be part of tax, had no express retrospective operation for the assessment year in question. On that basis, the interest accrued on the admitted tax could not be treated as part of the admitted tax for the relevant assessment year.

Conclusion: Interest under section 8(1-C) did not constitute part of the admitted tax for the assessment year under consideration.

Issue (ii): Whether an appeal could be said to be not entertainable merely because the interest was deposited after filing of the appeal, although the admitted tax had been deposited before filing.

Analysis: The requirement in section 9 had to be tested by reference to section 9 alone. Where the assessee had filed returns and had deposited the admitted tax before filing the appeal, the appeal satisfied the statutory condition for entertainment. Since section 8(1-C) was inapplicable to the assessment year and interest could not be imported into the condition under section 9, the later deposit of interest did not render the appeals time-barred or incapable of being entertained.

Conclusion: The appeals were entertainable and were not barred for non-deposit of interest before filing.

Final Conclusion: The revisions succeeded, the orders holding the appeals barred were set aside, and the appellate authority was required to hear the appeals in accordance with law.

Ratio Decidendi: For an assessment year governed by the unamended law, interest later made statutorily recoverable as part of tax cannot be treated as a pre-condition for entertainment of an appeal when the appeal provision speaks only to deposit of admitted tax; the right of appeal is substantive and cannot be burdened by a later amendment absent retrospective operation.

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