Supreme Court: In an appeal against the judgment of the Division Bench of the Kerala High Court which has affirmed the order of the Single Judge, by which, the application filed by the appellant, seeking restoration of the statutory appeal before the appellate authority was rejected, the division bench of BV Nagarathna and Ujjal Bhuyan, JJ. while setting aside the orders of the High Court as well as the appellate authority, restored the appeal before the Joint Commissioner of Appeals. Further, it opined that the appellate forums would be obliged to consider the taxpayer’s challenge on merits where its amnesty application is rejected.
Background:
The appellant is a dealer registered under the provisions of the Kerala Value Added Tax Act, 2003 (‘KVAT Act’). The Sales Tax Officer cancelled the appellant’s KVAT registration on the assumption that the appellant had permanently closed his business, as no transaction had taken place and his registration of dealership had not been renewed. The appellant assailed the order of the Sales Tax Officer before the Joint Commissioner (Appeals) in The appellant had also challenged the assessment order imposing tax liability of Rs.8,32,753/- before the Joint Commissioner of Appeals. When the matter was pending before the said appellate authority, the appellant availed himself of the Amnesty scheme introduced by the Government of Kerala. To avail of the said benefit under the Amnesty scheme, the appellant withdrew his appeal pending before the appellate authority. However, the appellant was not successful in availing the benefit of the Amnesty scheme.
In the circumstances, the appellant sought restoration of his appeal against the order of the Sales Tax Officer dated 22-07-2018, which was pending before the Joint Commissioner of Appeals, the application for restoration was dismissed by the said appellate authority on the ground that he had not raised any valid ground for seeking restoration of the appeal. Being aggrieved, the appellant challenged the order dated 21-02-2022 before the Kerala High Court whereby the application for restoration of the appeal was dismissed. Kerala High Court dismissed the writ petition on the ground that the appellant could not seek restoration of the appeal on being unsuccessful in availing the benefit under the Amnesty scheme. Thereafter, the Division Bench of the Kerala High Court dismissed the Intra Court Appeal stating that the appellant had no reason to seek restoration of his appeal on initially withdrawing the same. Hence, the appellant filed the present appeal.
Analysis:
The Court noted that the appellant withdrew his appeal before the appellate authority with a view to seek the benefit under the Amnesty scheme, however, he could not pay up the amount in order to avail the benefit of the said scheme. In the circumstances, he moved an application seeking restoration of his appeal to be heard on merits.
The Court said that one of the conditions for seeking the benefit under the Amnesty scheme is that there should be no pending proceeding and to comply with that condition, the appellant had withdrawn his appeal pending before the appellate authority. But there is no bar as such for seeking restoration of the appeal if the assessee is unsuccessful in availing the benefit under the Amnesty Scheme, since the appeal being a statutory remedy the appellant had availed of such a statutory remedy and withdrawn the same only as a pre-condition for availing the benefit under the Amnesty Scheme.
The Court further said that since the appellant did not avail such a benefit, he was entitled to be heard in the appeal on merits. Therefore, he sought permission for restoration of the appeal by filing such an application. Thus, the Court said that the appellate authority as well as the High Court ought to have permitted the appellant to seek restoration of his appeal before the appellate authority, so that the same could have been heard on merits.
As the application filed by the appellant was rejected, and neither the appeal has been restored nor has he been heard on merits and further remedies have also been foreclosed, the Court set aside the orders of the High Court as well as the appellate authority and restored the appeal before the Joint Commissioner of Appeals.
[PM Paul v State Tax Officer, 2023 SCC OnLine SC 1141, Order dated 01-09-2023]
Advocates who appeared in this case :
For Petitioner(s): Advocate Abhilash M.R., Advocate Alim Anvar, Rajkumar, Advocate Anu K Joy, Advocate-On-Record Mohammed Sadique T.a.
For Respondent(s): Advocate-On-Record C. K. Sasi, Advocate Meena K Poulose
