2023 (5) TMI 856 - HC - VAT and Sales Tax

Court Dismisses Petition Challenging Tax Order & Pre-Deposit Waiver, Emphasizes Compliance

M/s Larsen and Toubro Ltd. Versus Union Territory of Chandigarh and others

M/s Larsen and Toubro Ltd. Versus Union Territory of Chandigarh and others - TMI Issues:The issues involved in the judgment are the quashing of an order passed by the Deputy Excise & Taxation Commissioner, demand notice, waiver of pre-deposit, constitution of the Appellate Tribunal, and compliance with the amended provisions of Section 62 (5) of the Punjab VAT Act, 2005.Quashing of Order and Waiver of Pre-deposit:The petitioner sought the quashing of an order and demand notice issued by the Deputy Excise & Taxation Commissioner, along with a direction to hear the statutory appeal without insisting on pre-deposit. The petitioner argued that the tax already paid was sufficient for the purpose of Section 62 (5) of the Act. However, the appeal was dismissed for not making the 25% pre-deposit of the additional demand, as required by the amended provisions of the Act. The petitioner contended that the amendment during the pendency of the appeal should be applied, and the Appellate Authority was bound by the amended provisions. The Court held that the right of appeal is granted by statute, and the conditions imposed must be complied with. As the application for waiver of pre-deposit was pending when the amendment came into force, the Appellate Authority was required to apply the amended provisions. Therefore, the petition for quashing the order was dismissed.Constitution of Appellate Tribunal:The petitioner also sought a direction to constitute the Appellate Tribunal in accordance with the directions of the Supreme Court. The respondents argued that the petitioner had an alternative remedy to file a second appeal before the VAT Tribunal. It was contended that the Appellate Authority had rightly passed the order in compliance with the directions given by the Court. The respondents referred to previous judgments to support the mandatory nature of the pre-deposit requirement. The Court held that the present case was not a fit one to bypass the alternative remedy provided under the Act. The Court emphasized that the conditions of pre-deposits are procedural, and the petitioner could not claim its right to appeal based on un-amended provisions. Consequently, the petition for constitution of the Appellate Tribunal was dismissed.Compliance with Amended Provisions:The Court considered the amendment to Section 62 (5) of the Act, which required a 25% pre-deposit of the total amount of additional demand and interest. The petitioner argued that the amended provisions should not apply retroactively to their case, as the application for waiver of pre-deposit was pending when the amendment came into force. However, the Court held that the Appellate Authority was bound by the amendment and could not waive off the conditions of pre-deposit based on un-amended provisions. The Court found no illegality in the impugned order and dismissed the petition.Separate Judgment by the Judges:The judgment was delivered by Hon'ble Ms. Justice Ritu Bahri and Hon'ble Mrs. Justice Manisha Batra of the Punjab and Haryana High Court.