Accrual of right of appeal determines whether a statutory payment condition applies; pre-amendment lis exempt, post-amendment lis subject.

Whether payment of the prescribed percentage was a condition precedent to the Deputy Commissioner entertaining an appeal turned on when the right of appeal accrued; the court treated accrual as the date of service of the statutory notice (the commencement of the lis) and applied the amendment only prospectively from its commencement. Applying that rule, the proviso introduced by the Finance Act did not apply to the assessment whose lis commenced before the amendment and the Deputy Commissioner should not have rejected that appeal for non-payment; the proviso did apply to the assessment whose lis commenced after the amendment and rejection for non-payment was correct.

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Issues: Whether payment of the prescribed percentage of tax (as introduced by the Bihar Finance Act, 1951) was a condition precedent to the Deputy Commissioner entertaining an appeal, and whether the appeal could be summarily rejected for failure to deposit the sum in time.

Analysis: The Court examined when the right of appeal vests for the purposes of applicability of an amendment imposing a payment condition. Applying authorities that treat the right of appeal as accruing on the initiation of the proceedings (the commencement of the lis), the Court identified the date of notice under section 19(2) as the relevant date for accrual. The proviso to section 25(1) was inserted by section 8 of the Bihar Finance Act, 1951 which came into force on 1 April 1951; therefore the proviso applies only to appeals where the lis commenced on or after that date. The Court applied these principles to the two accounting years: for 1949-50 the notice (commencement of lis) was 4 July 1950 (prior to the amendment), and for 1950-51 the notice was 12 June 1951 (after the amendment).

Conclusion: The proviso requiring payment before entertaining an appeal does not apply to the assessment for the accounting year 1949-50 and the Deputy Commissioner should not have rejected that appeal for failure to pay the prescribed proportion; the proviso does apply to the assessment for the accounting year 1950-51 and the Deputy Commissioner was correct to reject that appeal for non-payment.

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