Andhra Pradesh General Sales Tax Act, 1957 – Proviso to s.19 and s.21(2) – Appellate Authority rejected the appeals preferred by the concerned appellants-assessees under the provisions of 1957 Act or 2005 VAT Act of AP or Telangana, as the case may be – Appeals were dismissed inter alia on the ground that the appellants failed to comply with the pre-condition of producing proof of payment of tax admitted to be due for the relevant assessment year in respect of which the appeal was preferred by the concerned appellant – Writ petitions filed by the appellants – Dismissed by the High Court relying on the decision of the co-ordinate bench in Ankamma Trading case – On appeal, held: First proviso in s.19 of 1957 Act and s.31 of AP VAT Act, as the case may be, pertains to limitation period “for filing” of an appeal and discretion of the Appellate Authority to condone the delay in filing such appeal, up to a maximum period specified therein – Second proviso though part of the same section, is an independent condition mandating the appellant to produce proof of payment of tax dues in respect of which the appeal is preferred – Even the High Court in Ankamma Trading Company had justly noted that the said proviso does not provide for any specific period within which the tax dues should be paid – There is no express stipulation to deposit the tax dues in respect of which the appeal is preferred, at the time of its filing, institution or presentation as such – In the absence of such clear stipulation, it is open to the assessee to file the appeal within the statutory period of limitation provided therefor and later on, deposit the specified tax dues but before the appeal is taken up for consideration by the Appellate Authority for the first time, be it for condonation of delay in filing the appeal and/or to admit it on merits or otherwise –Proof of such payment having been made could be produced thereat, failing which, the Appellate Authority will have to reject the appeal on that count – Filing, institution or presentation of appeal in the office of the Appellate Authority is an independent event than the appeal being taken up for consideration “for the first time”– It is possible that some unscrupulous litigant (assessee) may file appeal within the limitation period but keep it under defect so that the same does not proceed for consideration before the Appellate Authority – To obviate such mischief, the Appellate Authority shall take up every singular appeal for consideration for admission on merits and/or for condonation of delay in filing the appeal for the first time, no later than 30 days from the date of its filing, institution or presentation in its office – Direction be complied with by all concerned meticulously, without any exception – Judgment of the High Court set aside – Writ petitions allowed – Concerned appeals stand restored to the file of the Appellate Authority and be considered in accordance with law – AP VAT Act, 2005 – Second Proviso to s.31 and Proviso to s.33(2) – Telangana State VAT Act, 2005 – Constitution of India – Art.136 – Doctrine of Merger – Interpretation of Statutes.
Amdhra Pradesh General Sales Tax Act, 1957 – Power of the Appellate Authority under 1957 and 2005 Act – Discussed – AP VAT Act, 2005 – Telangana State VAT Act, 2005.
Practice & Procedure – Filing, institution or presentation of appeal vis-a-vis the appeal being taken up for consideration – Difference between – Explained.
Disposing of the appeals, the Court
HELD: 1.1 The first proviso in the concerned Section (Section 19 and Section 31, as the case may be) pertains to limitation period “for filing” of an appeal; and discretion of the Appellate Authority to condone the delay in filing of such appeal, up to a maximum period specified therein. Indeed, the second proviso is part of the same Section. However, it is an independent condition and in one sense, mutually exclusive condition mandating or enjoining the appellant to produce proof of payment of tax dues in respect of which the appeal is preferred. That obligation can be discharged until the appeal is considered for admission and/or condonation of delay in filing of the appeal, as the case may be, by the Appellate Authority for the first time. Even the High Court in Ankamma Trading Company had justly noted that the said proviso does not provide for any specific period within which the tax dues should be paid. Moreover, there is no express stipulation to deposit the tax dues in respect of which the appeal is preferred, at the time of its filing, institution or presentation as such. In the absence of such a clear stipulation, it must necessarily follow that it is open to the assessee to file the appeal within the statutory period of limitation provided therefor and later on, deposit the specified tax dues but before the appeal is taken up for consideration by the Appellate Authority for the first time – be it for condonation of delay in filing the appeal and/or to admit it on merits or otherwise. The proof of such payment having been made could be produced thereat. Failing which, the Appellate Authority will have no other option but to reject the appeal on that count. The Appellate Authority has no power to extend the time to deposit the specified tax dues. Suffice it to observe that, stricto sensu, the said proviso is not a provision of pre-deposit at the stage of filing, institution or presentation of the appeal as such; but is a provision stipulating payment of tax dues as a pre-requisite or sine qua non for consideration of appeal on merits or otherwise and/or for condonation of delay in filing the same, as the case may be, for the first time. It is also to impose fetter on the Appellate Authority from admitting the appeal for consideration on merits. It is well recognized that filing, institution or presentation of appeal in the office of the Appellate Authority is an independent event than the appeal being taken up for consideration “for the first time” for being admitted on merits or otherwise and/or for condonation of delay in filing it, as the case may be. There is no reason to interpret the stated proviso in any other manner lest, inevitably, it would result in re-writing the same and entail in doing violence to the legislative intent. Presumably, Supreme Court in M/s. Innovatives Systems, and other decisions rendered following the same, therefore, was persuaded to allow the appeal preferred by the assessee and to relegate the parties before the Appellate Authority for consideration of the appeal for admission on merits. Concededly, Supreme Court was conscious of the decision in Ankamma Trading Company. In that, the judgment under challenge before it in the concerned appeal was founded on the view already taken by the coordinate bench of the same High Court [including in Ankamma Trading Company]. It has been so recorded by Supreme Court. In that sense, the legal position expounded in Ankamma Trading Company, stood impliedly overruled, even though that decision has not been adverted to or expressly overruled by Supreme Court. Indeed, the decision of Supreme Court in M/s. Innovatives Systems, is a brief judgment. That, however, would make no difference. For, it is well established that once a special leave petition has been granted, the doors for the exercise of appellate jurisdiction of this Court have been let open. Resultantly, the order impugned before the Supreme Court became an order appealed against and any order passed thereafter would be an appellate order and attract the doctrine of merger despite the fact that the order is of reversal or of modification or of affirming the order appealed against and including is a speaking or non-speaking one. This legal position has been restated in Kunhayammed. The argument of the respondent-State that the decision of Supreme Court in M/s. Innovatives Systems, and other decisions following the same, cannot be considered as binding precedent is rejected. [Paras 8-11] [109-G-H; 110-A-H; 111-A-G]
1.2 The first proviso pertaining to maximum period of delay to be condoned by the Appellate Authority, also uses the expression “admit the appeal”. That expression “admit”, however, must be read to mean filing, institution or presentation of the appeal in the office of the Appellate Authority. Whereas, the expression “admitted” used in the second proviso will have to be construed as analogous to expression “entertained”. The setting in which the provisions under consideration appear leaves no manner of doubt that it is ascribable to the event of taking up the appeal for consideration, for the first time, to admit it on merits or otherwise and/or for condonation of delay in filing the appeal, as the case may be. Before that event occurs, it is open to the appellant to deposit the tax dues in respect of which the appeal is preferred and produce proof of such deposit before the Appellate Authority. This view is reinforced from the exposition of Supreme Court in Ranjit Impex, wherein the view taken by the Division Bench of the High Court of Madras that the proof of deposit of tax has to be produced at the time when the appeal is taken up for consideration, but not at the time of filing or presentation of the appeal, has been upheld. Even the decision of this Court in M/s. Lakshmi Rattan Engineering Works Ltd., heavily relied upon by the respondent-State, does not militate against the view taken by us - that the true purport of the said proviso is that the Appellate Authority shall proceed with the consideration of appeal for admission for hearing on merits or otherwise and/or for condonation of delay in filing appeal, as the case may be, if the proof of payment of the specified tax dues referred to in the said proviso is produced by the appellant on the first date of such consideration of the appeal. [Paras 12-14] [112-A-F]
1.3 In the appeals under consideration, admittedly, the appellant-assessee had deposited the specified tax dues before the date on which appeal preferred by them was taken up for consideration for the first time for admission on merits. In such a situation, the stated proviso becomes unavailable to reject the appeal on the ground of institutional defect. In this view of the matter, all these appeals must succeed. Taking advantage of the interpretation given, it is possible that some unscrupulous litigant (assessee) may file an appeal within the limitation period but keep it under defect so that the same does not proceed for consideration before the Appellate Authority. To obviate such a mischief, it is directed that the Appellate Authority shall be obliged to take up every singular appeal for consideration for admission on merits and/or for condonation of delay in filing the appeal for the first time, no later than thirty days from the date of its filing, institution or presentation in the office of the Appellate Authority. This direction shall be complied with by all concerned meticulously, without any exception. That is the only way to secure the interests of the Revenue and at the same time to effectuate the purpose underlying the proviso regarding the deposit of specified amount of tax dues. Resultantly, the impugned judgment of the High Court is set aside and instead the writ petition(s) are allowed by setting aside the order passed by the Appellate Authority, rejecting the concerned appeals on the ground of non-compliance of the stated proviso of the provisions under consideration. The concerned appeals shall stand restored to the file of the Appellate Authority. The same shall proceed for consideration in accordance with law. [Paras 16-18] [113-C-H; 114-A]
Civil Appeal Nos.4098/2016 & 4099/2016
1.4 In this set of appeals, admittedly, the appellant-assessee deposited the amount after the appeal filed by them came to be rejected by the Appellate Authority. In that sense, the appellantassessee failed to produce proof of payment of tax dues in respect of which the appeal was preferred before the Appellate Authority when their appeal was taken up for consideration for admission. Resultantly, the deposit made after rejection of the appeal will be of no avail to the appellant-assessee, in light of the mandate of the stated proviso under consideration. In view of the above, these appeals are dismissed. [Paras 19, 20] [114-B-D] Civil Appeal No.8452/2016
1.5 If the appeal filed by the respondent is still pending and has not been taken up for consideration so far by the Appellate Authority, only then it would be open to the respondent to deposit the requisite amount and produce the proof of such deposit before the Appellate Authority. If, however, the appeal has already been taken up for consideration for being admitted on merits or otherwise and by that date the respondent had not deposited the requisite amount as prescribed in terms of stated proviso, the Appellate Authority would be well within its jurisdiction and rather duty bound to reject the appeal on the ground of an institutional defect. That is a matter to be considered by the Appellate Authority. [Para 23] [115-C-E]
Civil Appeal No. 5343 of 2019
1.6 The impugned judgment is set aside and the parties are relegated before the High Court for reconsideration of the Writ Petition No.837/2014 afresh on its own merits in accordance with law and including in light of decision of this Court in Civil Appeal No.7574/2014 decided today. All contentions available to both sides in the remanded writ petition are left open to be considered on its own merits and in accordance with law. [Para 33] [119-A-B]
Civil Appeal No.10670/16
1.7 The parties are relegated before the High Court to consider the same on its own merits, in accordance with law. All questions and contentions, available to both sides, are left open to be decided by the High Court on its own merits. The impugned judgment of the High Court is set aside. [Paras 38, 39] [121-D-E]
Civil Appeal No.3349/2018
1.8 In the present appeal, the appellant cannot be heard to agitate the question already decided in Civil Appeal No.7574/2014 as nothing has been brought to notice to show that the appellant had deposited the specified tax dues, in respect of which the appeal was filed, before the first date of consideration of the appeal by the Appellate Authority. However, as the High Court has dealt with merits of the challenge to the original order, in exercise of writ jurisdiction and as no argument was advanced by either party in that regard, this appeal is delinked and directed that it be heard separately on the challenge to the original order passed by the first Appellate Authority. Appeal to proceed accordingly. [Paras 40, 41] [121-H; 122-A-B]
Ankamma Trading Company v. Appellate Deputy Commissioner (CT), Guntur & Anr. (2011) 44 VST 189 (AP); M/s. IOT Infrastructure & Energy Services Ltd., Rep. by its Deputy Manager (Accounts) v. State of Andhra Pradesh Rep. by its Principal Secretary to Government (Judgment of Supreme Court dated 14.12.2016 in Civil Appeal No.12077/2016); M/s. Ranisati Trading Co. Rep. by its Managing Partner v. Commercial Tax Officer, Gajuwaka Circle, Visakhapatnam and Ors. (Judgment of Supreme Court dated 17.04.2017 in Civil Appeal No.5339/2017); M/s. Lakshmi Rattan Engineering Works Ltd. v. Asst. Commr. Sales Tax, Kanpur & Anr. [1968] 1 SCR 505 ; Narayan Chandra Ghosh v. UCO Bank and Ors (2011) 4 SCC 548 :
[2011] 3 SCR 1024 – referred to.
M/s. Innovatives Systems, Rep. by its Managing Partner v. State of Andhra Pradesh, Rep. by Principal Secretary to Government (Judgment of Supreme Court dated 23.02.2015 in Civil Appeal No.2230/2015) ; Kunhayammed and Ors. v. State of Kerala and Anr. (2000) 6 SCC 359 : [2000] 1 Suppl. SCR 538;
Ranjit Impex v. Appellate Deputy Commissioner and Anr. (2013) 10 SCC 655 – relied on.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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