Tax payment as a condition for maintainability does not extinguish the right of appeal; delay may still be considered after payment.

Under section 30(1) of the Indian Income-tax Act, 1922, non-payment of tax did not prevent presentation of the memorandum of appeal, but it did bar proper entertainment of the appeal until payment was made. If the tax was paid within limitation, the appeal became maintainable in time; if payment occurred after limitation, the appeal was treated as filed on the date of payment and the authority had to consider whether delay should be condoned. The SC held that the statutory payment requirement affected maintainability, not the underlying right of appeal, and answered the reference against the Revenue and in favour of the assessee.

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Issues: Whether an appeal under section 30(1) of the Indian Income-tax Act, 1922 filed before the Appellate Assistant Commissioner without prior payment of tax was a valid appeal and, if the tax was paid after the limitation period, whether the appeal had to be treated as filed on the date of payment so that delay could be considered for condonation.

Analysis: The proviso to section 30(1) barred the entertainment of an appeal unless the tax had been paid, but it did not mean that a memorandum of appeal could not be presented at all. The statutory bar affected the proper filing and maintainability of the appeal, not the existence of the right to present the memorandum. If the tax was paid within the limitation period, the appeal would become a proper appeal within time. If payment was made after limitation had expired, the appeal would be treated as filed on the date of payment, and the question would then arise whether there was sufficient cause for condonation of delay. Section 30(2) supported this construction.

Conclusion: The appeal was not a complete and proper appeal until the tax was paid, and if payment occurred after limitation, the Appellate Assistant Commissioner had to consider condonation of delay. The question referred was answered against the Revenue and in favour of the assessee.

Final Conclusion: The statutory requirement of tax payment was a condition for proper entertainment of the appeal, but it did not destroy the underlying right of appeal or prevent consideration of delay once payment was made.

Ratio Decidendi: A statutory bar that no appeal shall lie until tax is paid prevents the appeal from being properly entertained, but does not extinguish the right to present the memorandum; upon payment, the appeal becomes maintainable and limitation must then be examined for condonation of delay.

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