TMI Blog2006 (11) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... pellate Tribunal. The question was as to whether these appeals require pre-deposit in terms of the amended section 22(3) of the KST Act and amended section 14(3) of the Entry Tax Act. The matter was referred to a Full Bench of the Karnataka Appellate Tribunal. The Full Bench by majority ruled that the amendment is not applicable to these cases in the light of the lis having commenced prior to the amendment dated August 1, 2004. The commercial member however gave his dissenting opinion. It is in these circumstances, these petitions are filed. The following questions of law would arise for our consideration: 1. Whether the amendment effected to section 22(3) of the KST Act and section 14(3) of the KTEG Act by Karnataka Amendment Act No. 26 of 2004 with effect from August 1, 2004 is procedural in nature or substantive in nature and whether the Karnataka Appellate Tribunal is justified in giving a finding that the said amendment is substantive in nature? 2.. Whether the Tribunal is justified in giving a finding that the lis commences on the date when the return is filed or is required to be filed? 3.. Whether the amendment effected to section 22(3) of the KST Act and section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiation of the proceedings and not the decision itself. In Garikapati Veeraya v. N. Subbiah Choudhury AIR 1957 SC 540, the Supreme Court considered the right of appeal and also a vested right. The court ruled as under: (i) . . . (ii) The right of appeal is not a mere matter of procedure but is a substantive right. (iii) The institution of the suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit. (iv) The right of appeal is a vested right and such a right to enter the superior court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law prevailing at the date of the institution of the suit or proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal. (v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise. In State of Bombay v. Supreme General Films Exchange Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid to be arisen also when an assessee is called upon to furnish return on his failure to do so in terms of the provisions of the old Act. In fact, that is the relevant date as in Vitthalbhai Naranbhai Patel's case [1961] 12 STC 219 (SC); AIR 1967 SC 344. 37.. In view of the above discussion, we hold that right of appeal is a vested right as if exists on the date of commencement of lis. The lis can be said to commence under the HGST Act on the date when return is filed or is required to be filed. Therefore, the provisions of section 39(5) of the HGST Act would continue to govern the right of appeal vested in the petitioner which is saved in terms of section 4 of the Punjab General Clauses Act (as applicable to State of Haryana). The Madras High Court in Deputy Commercial Tax Officer v. Cameo Exports [2006] 147 STC 218 after noticing the judgment of the Punjab and Haryana High Court in Khazan Chand Nathi Ram v. State of Haryana [2004] 136 STC 261, held as under: . . . the crucial date on which the right of the assessees to prefer an appeal under section 31 or section 36 of the Act is the date on which the returns are filed under the Act. In all these appeals, returns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ya v. N. Subbiah Choudhury AIR 1957 SC 540 ruled as under: 12. It is the firmly established judicial view that the right of appeal is not an inherent right so also it is not a fundamental right. The right of appeal is a mere creature of the statute and it is open to the Legislature which creates such a right equally to take away the same if necessary. The court further ruled in para 14 as under: 14. Section 22(3A) and 22(5) of the Act, as amended by Amendment Act 15 of 1998 has neither taken away nor curtailed nor crippled the right of appeal. What is taken away is only the power of the Appellate Tribunal to grant stay that too in second appeals. The learned Government Advocate effectively met the arguments of the writ petitioners that the amended provisions of the Act are opposed to article 14 of the Constitution of India by submitting that by amended provisions the power to grant stay is conferred on the Tribunal in case of appeals filed against the orders made under section 21, i.e., in case of first appeals and taken away the powers to grant stay in case of second appeals arising from the orders made under section 20 of the Act, and as such there is nothing to say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r curtailed nor crippled the right of appeal. What is taken away is only the power of the Appellate Tribunal to grant stay, that too in second appeals. We are bound by the judgments of this court. In our view, the insistence on payment of pre-deposit at the time of filing of second appeal cannot be considered to be taking away any vested right as sought to be argued by the assessees. The consideration of appeal is only restricted in the sense that some deposit is insisted in terms of the Act. The said amendment in our view, cannot said to result in depriving any right of an assessee as argued before us. Though the Division Bench of the Punjab and Haryana High Court in Khazan Chand Nathi Ram v. State of Haryana [2004] 136 STC 261 and Madras High Court in Deputy Commercial Tax Officer v. Cameo Exports [2006] 147 STC 218 have dealt with the questions of law, they have not chosen to consider the character of the second appeal in terms of the statute in those judgments. On the other hand, the two Division Benches of this court have chosen to say that no right of the assessee is taken away that too in second appeals while considering the statutory condition in the second appeal. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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