TMI Blog2007 (2) TMI 592X X X X Extracts X X X X X X X X Extracts X X X X ..... Act and Rs. 14.78 lacs under the Central Act ; only the latter amount was deposited. So far as direction to deposit Rs. 4.20 crores is concerned the appellant/petitioner had approached the Appellate Tribunal, Value Added Tax, Delhi for relief. It was, inter alia, contended that the financial condition of the petitioner/appellant was very poor and payment of such a huge amount would mean virtually throwing the petitioner out of trade. In the present petition it has been submitted that the financial condition of the petitioner is not very strong. Predeposit of such a huge amount shall put the petitioner into financial hardship . The Tribunal noted that although learned counsel for the parties had addressed arguments on the merits of the appeal, the only question before the Tribunal pertained to the deposit of tax as a pre-condition for maintaining the appeal before the first appellate authority, Additional Commissioner-IV. The Tribunal took the view that keeping the financial position of the petitioner in perspective the order dated February 2, 2006 by the first appellate authority should be modified to the extent that it shall entertain the appeal if the appellant deposits Rs. 2 cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty must be given to the assessee. In Novopan case [1994] Supp 3 SCC 606 the court had encountered an exception or exemption provision and it is in this context that it had been enunciated that the advantage of ambiguity or doubt must go to the State. In other words, any exception to the general rule would be available only if it is clearly and unequivocally in favour of the assessee. In order to counter the argument Mr. Taneja has also made a futile effort to garner support from Balavant N. Viswamitra v. Yadav Sadashiv Mule (Dead) through LRs, [2004] 8 SCC 706. However, in that case it was found that the decree which was at the fulcrum of the dispute could not be described as a nullity by any stretch of the imagination. In order to arrive at such a conclusion the court must perforce weigh every facet of the merits of the case and it is this very exercise that Mr. Taneja would like us to avoid. The decision of this court in Vijay Power Generators Ltd. v. Commissioner of Sales Tax [2000] 120 STC 377 has been relied upon by the learned counsel for both the parties. The Bench comprising Arijit Pasayat and D. K. Jain, J., as their Lordships then were, reiterated the well-entrenched l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... si-judicial adjudications. The right to appeal is a statutory right and it can be circumscribed by the conditions in the grant'. This position was once again reiterated in Gujarat Agro Industries Co. Ltd. v. Municipal Corporation of the City of Ahmedabad AIR 1999 SC 1818. It was again articulated in State of Haryana v. Maruti Udyog Ltd. [2001] 124 STC 285 (SC); AIR 2000 SC 2941 in the syntax of sales tax legislation, in these words: 'There cannot be any dispute that right of appeal is the creature of the statute and has to be exercised within the limits and according to the procedure provided by law. It is filed for invoking the powers of a superior court to redress the error of the court below, if any. No right of appeal can be conferred except by express words. An appeal, for its maintainability, must have a clear authority of law. Sub-section (5) of section 39 of the Act vests a discretion in the appellate authority to entertain the appeal if it is filed within sixty days and the amount of tax assessed along with penalty and interest, if any, recoverable from the persons has been paid. The aforesaid restriction is subject to the proviso conferring discretion upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that while exercising powers under the proviso to section 43(5) what is required to be seen is whether (a) there is a prima facie case involving grant of full stay; (b) the balance of convenience qua deposit or otherwise and (c) irreparable loss, if any, would be caused to the appellant in case stay is not granted. It was further observed that the appellate authority must be mindful that the condition of pre-deposit should not be so stringent as to be incapable of being complied with. The Appellate Tribunal, Sales Tax, Delhi had directed the petitioner to make a pre-deposit of Rs. 3,21,00,000 in cash and furnish a surety for Rs. 1,87,40,000, thus aggregating to Rs. 5,08,40,000. The Bench did not reduce the amount, but permitted credits of Rs. 46,50,000 lacs which had been deposited in the court and Rs. 80,00,000 which was indisputably due as refunds, to be deducted from the quantum of the amount directed as the pre-deposit. In J.N. Chemical Pvt. Ltd. v. CEGAT [1991] 53 ELT 543, the division Bench of the Calcutta High Court opined that since a judgment existed in favour of the appellant on all fours, the power to dispense with the pre-deposit requirement ought to have been exerc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant, the appellate authority must satisfy itself of the existence or absence of a prima facie case set-up by the appellant, in whose favour the balance of convenience must lie, and who would be visited with irreparable loss unless interim orders are passed; it should always be mindful that public interest or interests of the Revenue are not endangered. So far as the sales tax and DVAT Acts are concerned, it appears to us that safeguarding the interests of the Revenue is adequately achieved through the requirement of the furnishing of security or a surety. It is in this context that Mr. Taneja has drawn attention to the oft-quoted decision in Assistant Collector of Central Excise, Chandan Nagar, West Bengal v. Dunlop India Ltd. AIR 1985 SC 330, the relevant portion of which reads as follows: 7. Now coming to the facts of the present case, the respondent, Dunlop India Limited, is a manufacturer of tyres, tubes and various other rubber products. By a notification dated April 6, 1984 issued by the Government of India, Ministry of Finance (Department of Revenue) in exercise of the powers conferred by rule 8(1) of the Central Excise Rules, 1944, tyres, falling under item No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certainly in favour of the Government of India. Governments are not run on mere bank guarantees. We notice that very often some courts act as if furnishing a bank guarantee would meet the ends of justice. No Governmental business or for that matter no business of any kind can be run on mere bank guarantees. Liquid cash is necessary for the running of a Government as indeed any other enterprise. We consider that where matters of public revenue are concerned, it is of utmost importance to realise that interim orders ought not to be granted merely because a prima facie case has been shown. More is required. The balance of convenience must be clearly in favour of the making of an interim order and there should not be the slightest indication of a likelihood of prejudice to the public interest. We are very sorry to remark that these considerations have not been borne in mind by the High Court and interim order of this magnitude had been granted for the mere asking. The appeal is allowed with costs. These views are also to be found in Siliguri Municipality v. Amalendu Das AIR 1984 SC 653, State of Madhya Pradesh v. M.V. Vyavsaya Co. AIR 1997 SC 993 and Upadhyay Co. v. State of U. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in Suresh Jindal v. BSES Rajdhani Power Ltd. in L. P. A. No. 256 of 2006 decided on February 20, 2006. The division Bench presided over by Chief Justice Markandeya Katju, as his Lordship then was, had ruled that since the respondent had applied for a licence under rule 10(2) of the Delhi Electricity Reforms (Transfer Scheme) Rules, 2001 within sixty days of July 1, 2002, it was clothed with all the powers of a licensee under the Indian Electricity Act, 1910. It is Mr. Lakshmi Kumaran's contention that this observation has palpably escaped the attention of the Commissioner. On the other hand, Mr. Taneja has retorted by submitting that the factual matrix in that case was altogether different to the present case. In our view this argument of Mr. Lakshmi Kumaran is not so irresistible as would brook no further consideration. It touches upon the merits of the case. It is not one which must be accepted no sooner it is stated. This question will, no doubt, be considered at the time when the appeal is heard for final disposal. This, however, can happen only if orders of pre-deposit are complied with. It is in these circumstances that we do not consider it appropriate, at this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s stage] the Appellate Tribunal may waive the amount in dispute . The repeated use of the word dispute in both situations is confusing and ought to have been avoided by the Legislature. However, it can have no meaning other than the total or entire amount found payable by the dealer who had filed objections under section 74(1) of the DVAT Act. The Customs Act, 1962 provides for filing of an appeal to the Commissioner (Appeals) under section 128. Thereafter, section 129 is the fasciculous concerning the functioning of the next authority, namely, Custom, Excise and Service Tax Appellate Tribunal. Section 129E of the Customs Act mandates that the person desirous of appealing against an order demanding duty, interest or penalty as the case may be shall, pending the appeal, deposit any or all such amount. Thereafter, the proviso dedicates discretion with the Commissioner (Appeals) or the Appellate Tribunal, as the case may be, hearing the appeal to dispense with such deposit as it may deem fit, mindful always that the interest of the Revenue are adequately safeguarded. The discretion is severely and pointedly circumscribed by and dependent upon the formation of the opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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