KAVUKOTI EKANADHAM Vs. STATE

JUDGEMENT

(1.) THE petitioners seek writs of mandamus to direct the Sales Tax Appellate Tribunal, Hyderabad, to forbear from enforcing its orders calling upon them to pay the entire sales tax and produce proof of such payment as a condition for entertaining the appeals filed by them to the Tribunal. The facts of the case lie within brief compass. The Commercial Tax Officer assessed the petitioners on each of these writ petitions to sales tax. According to the petitioners, the assessing authority acted arbitrarily land in contravention of the provisions of law in making the assessment. So, they preferred appeals to the Assistant Commissioner of Commercial Taxes under section 19 of the Andhra Pradesh General Sales Tax Act. Along with the appeals, the assessees filed applications to the appellate authority to stay collection of the disputed tax amount pending disposal of the appeals. But the Assistant Commissioner of Commercial Taxes asked the appleants to pay the amount of tax within 7 days or in default to run the risk of their appeals being dismissed in limine. The petitioners were not able to pay the tax amount within the shout period of 7 days. Consequently, the Assistant Commissioner of Commercial Taxes rejected their appeals on the sole ground of non-payment of the tax amount. The aggrieved assessees preferred appeals to the Sales Tax Appellate Tribunal. But the Tribunal, acting presumably under sub-section (6) of section 21 of the Andhra Pradesh General Sales Tax Act, called upon the assessees to pay the amount of tax and file proof of such payment within a specified time as a condition precedent to entertain the appeals. It is this order of the Tribunal that is now challenged in these writ petitions.

(2.) THE main contention on behalf of the petitioners is that sub-section (6) of section 21 of the Andhra Pradesh General Sales Tax Act has no application to the present cases and that the impugned orders of the Tribunal are therefore without jurisdiction. Section 21(6) of the Act is to the effect that no appeal shall be entertainable by the Tribunal, unless it is accompanied by proof of payment of tax, if any, as determined in any appeal under section 19 or in revision under section 20 of the Act. In the instant cases, no tax was determined by the Assistant Commissioner of Commercial Taxes in the appeals filed before him. He dismissed the appeals without at all going into the merits. There was no question, therefore, of his determining the tax liability of the petitioners. The terms of section 21(6) relation to deposit of tax and proof of payment thereof would apply only to cases where the appellate authority had determined under section 19 the tax payable by the assessee. In the present cases, no such determination was made, because the appeals were rejected by the Assistant Commissioner of Commercial Taxes in limine. There appears to be force in this contention. The words of section 21(6) appear to postulate a determination by the appellate authority under section 19 of the amount of tax payable by the appellant. This determination is undoubtedly a quasi-judicial determination on the merits of the appeal. In the cases on hand, no such determination on merits was made by the appellate authority, viz., the Assistant Commissioner of Commercial Taxes. Therefore, the condition of payment of the tax amount or proof of such payment contemplated by section 21(6) cannot reasonably come into force here. If section 21(6) does not apply, there does not appear to be any other provision to require the appellants (petitioners herein) to pay the taxes and file proof of such payment before the Tribunal as a condition precedent to entertaining their appeals. It seems to me, therefore, that the contention of the petitioners' learned counsel is well-founded. I do not wish to go into this aspect of the matter at greater length, because the order of the Assistant Commissioner of Commercial Taxes compelling the assessees to pay the tax amounts within a short period of 7 days on penalty of their appeals being otherwise rejected cannot be said to be reasonable. Orders like this render the right of appeal virtually illusory. Such orders can legitimately be characterised as arbitrary and capricious. The Assistant Commissioner of Commercial Taxes must have acted as a quasi-judge in a case like this and must have passes his orders according to established concepts of judicial discretion. It is difficult to say that he exercised his discretion along judicial lines in the cases on hand. This would demand his orders rejecting the appeals in limine being set aside with a direction that he should afford a reasonable time to the assessees to pay the tax amounts. This Court would have passed such an order but for the circumstances, that the assessees have already preferred appeals to the Tribunal and further that the Assistant Commissioner of Commercial Taxes has not been impleaded as a respondent in these writ petitions. This circumstance cannot, however, affect or alter the substantial requirement of quasi-judicial process which ought to have been complied with by the inferior Tribunal in a case like the present.

(3.) I would like to touch upon another aspect of the matter. By an appellate authority being too niggardly in granting time to an appealing assessee to deposit the tax amount, the process of collection of sales tax is not by any means rendered quicker or easier. On the contrary, an appellate authority, by being too chary of granting adequate time to an appellant to deposit the tax amount, would only pave the way for enormous delay in the eventual collection of sales tax. In the present cases, if these writ petitions happen to be pending in this Court, say, for an year, and thereafter the cases go back to the Appellate Tribunal and stay there, say, for another year and eventually return to the Assistant Commissioner of Commercial Taxes for disposal on merits, an inordinate period of time would have been gained by the assessees in the matter of paying up the tax. It is to avoid this possibility that I have hastened to dispose of these writ petitions. For the same reason, I would expect the Tribunal also to dispose of them expeditiously so that the attempt, if any, on the part of the assessees to play for time is effectively combated.