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1994 (2) TMI 296 - HC - VAT and Sales Tax
Issues:
1. Additional tax demand on intra-State sales treated as inter-State sales. 2. Dismissal of appeal for non-deposit of tax amount. 3. Authenticity of forms leading to sales tax demand. 4. Consideration of financial capability in tax liability cases. 5. Failure to provide reasonable time for payment arrangement. 6. Restoration of appeal and refund of deposited tax amount. Analysis: 1. The judgment concerns two writ petitions (C.W.P. Nos. 2215 and 2216 of 1994) involving the Steel Authority of India Limited, a Government undertaking, disputing tax demands under the Central Sales Tax Act and Punjab General Sales Tax Act for the assessment year 1990-91. The Assessing Authority claimed additional tax due to treating intra-State sales as inter-State sales, leading to substantial demands. 2. The petitioner's appeals before the Deputy Excise and Taxation Commissioner and Sales Tax Tribunal were dismissed for failure to deposit the tax amount. The Tribunal directed depositing the disputed tax by a specified date failing which the appeals would stand dismissed. The petitioner challenged these orders in the writ petition. 3. An issue arose regarding the authenticity of forms (ST-XXII) relied upon by the petitioner, leading to a separate sales tax demand under the Punjab General Sales Tax Act for the same assessment year. The petitioner faced a similar situation where the appeal was dismissed for non-deposit of the tax amount as directed by the Tribunal. 4. The petitioner argued that the financial position did not allow for immediate payment of the substantial tax liabilities and requested consideration for depositing the amount in installments. The petitioner contended that the Tribunal failed to exercise discretion properly under the law and did not provide adequate time for arranging the payment. 5. The Additional Advocate-General argued that the petitioner, being a Government undertaking, was not unable to pay the tax, emphasizing that the merits of the appeal should not be considered at the stage of depositing the tax amount, as per legal precedent. 6. The High Court, after considering the arguments, set aside the orders of the lower appellate authority and Sales Tax Tribunal, directing the petitioner to deposit the entire disputed tax amount within three months. The Court also ordered that if the appeals were allowed, the deposited amount would be refunded within one month of the decision. 7. The Court granted a stay on the recovery of the tax amount for three months to facilitate compliance with the directions provided in the judgment, thereby concluding the disposal of the writ petitions in favor of the petitioner.
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