Condition precedent to hearing: tax payment required before an appellate authority hears and disposes appeal under section 46(1).

Payment of tax under the first proviso to section 30(1) of the Income-tax Act, 1922 operates as a condition precedent to the hearing and final disposal of an appeal against orders under section 46(1), but does not bar presentation of the appeal. The proviso's language should be construed to regulate hearing and disposal rather than the right to present an appeal, because a construction that entirely deprives a taxpayer of the opportunity to have the matter heard should be avoided; accordingly an appeal may be presented prior to payment but cannot be heard or disposed of until payment is made.

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Issues: Whether the first proviso to section 30(1) of the Income-tax Act, 1922, which bars appeals in respect of orders under section 46(1) unless the tax has been paid, makes payment of the tax a condition precedent to (i) the presentation of the appeal or (ii) the hearing and final disposal of the appeal.

Analysis: The question requires construing the words "no appeal shall lie" in the first proviso to section 30(1) read with sub-section (2) of section 30 and section 46(1). The alternative constructions are: (i) that payment is a precondition to the very right to present an appeal, or (ii) that payment is a precondition to the appellate authority hearing and disposing of an appeal already presented. The language of sub-section (2) uses the word "presented" where the Legislature intended to regulate presentation; the proviso uses different language. Where a construction would operate to deprive an assessee altogether of the right of appeal, a construction that avoids such a denial and accords the assessee an opportunity to have the appeal heard on payment before disposal is to be preferred. The proviso, therefore, is to be read as affecting the hearing and final disposal of an appeal unless the tax has been paid, not as defeating the ability to present an appeal prior to payment.

Conclusion: Payment of the tax under the first proviso to section 30(1) of the Income-tax Act, 1922 is a condition precedent to the hearing and disposal of an appeal against orders under section 46(1), and is not a condition precedent to the presentation of the appeal.

Ratio Decidendi: The first proviso to section 30(1) of the Income-tax Act, 1922 requires tax to be paid before an appellate authority may hear and dispose of an appeal under section 46(1), but does not bar the presentation of the appeal prior to such payment.

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