Mandatory pre-deposit under VAT appeal rules led to quashing of appellate orders and remand for fresh hearing.

Appellate orders under the Orissa Value Added Tax Act, 2004 were quashed because the appellant had not complied with the mandatory pre-deposit of 10% of the tax demanded. The writ court treated the appeal as defective on that ground and held that the matter required reconsideration by the appellate authority. The orders were therefore set aside and the appeal remitted for fresh adjudication in accordance with law, with an opportunity of hearing to be given after deposit of the stipulated amount.

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Issues: Whether the appellate orders under the Orissa Value Added Tax Act, 2004 were liable to be quashed and the appeal remitted for fresh decision when the appellant had not complied with the statutory requirement of depositing 10% of the tax demanded, and whether an opportunity of hearing was to be afforded on compliance with that condition.

Analysis: The writ petition challenged the appellate orders passed under the relevant provisions of the Orissa Value Added Tax Act, 2004 on the footing that the appeal had been rejected without affording an opportunity of hearing. The Court noted that the petitioner had preferred the appeal against the assessment order but had not deposited the mandatory 10% of the tax demanded. In that circumstance, the appellate proceeding was treated as defective. The Court therefore found it appropriate to interfere, quash the impugned appellate orders, and remit the matter for reconsideration by the appellate authority in accordance with law, after giving the petitioner an opportunity of hearing and upon deposit of the stipulated amount.

Conclusion: The impugned orders were quashed and the appeal was remitted for fresh adjudication subject to the petitioner depositing 10% of the tax demanded.

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