Pre-deposit waiver in VAT appeals protects the statutory right of appeal when financial hardship is shown.

Mechanical dismissal of VAT appeals for non-deposit of the pre-deposit amount was held improper where the record indicated financial distress, sickness of the business and inability to comply. The Court noted that a statutory right of appeal should not be defeated in every case by insisting on pre-deposit, and that the appellate authority must consider waiver on facts and, where justified, decide the appeal on merits rather than reject it in limine. The pre-deposit requirement was waived, the dismissal orders were quashed, and the appeals were restored for fresh decision on merits.

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Issues: Whether the appellate authority was justified in dismissing the appeals solely for non-deposit of the pre-deposit amount and whether, in the petitioner's financial condition, the pre-deposit requirement under the VAT law could be waived so that the appeals could be heard on merits.

Analysis: The appeals had been rejected without examination of the merits only because the mandatory pre-deposit had not been made. The Court noted that a statutory right of appeal should not be defeated mechanically by insisting on pre-deposit in every case. Where the record shows financial distress, sickness of the industry, and material indicating incapacity to comply, the appellate authority should consider waiving the pre-deposit and decide the appeal on merits instead of dismissing it in limine.

Conclusion: The pre-deposit requirement was waived, the impugned orders dismissing the appeals were quashed, and the appeals were restored for decision on merits in accordance with law.

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