DEBANGSU BASAK, J. - (1.) The writ petitioners challenge the vires of the second proviso to Section 84(1) of the West Bengal Value Added Tax Act, 2003. As the writ petitions involve the same issues they are taken up for hearing analogously.
(2.) It is submitted on behalf of the petitioners that, the second proviso to Section 84(1) of the Act of 2003 requires payment of tax in dispute for the purpose of maintaining an appeal against an order in original. The requirement of payment is an exaction rather than a pre-deposit. The Act does not postulate a pre-deposit. Since the word used is payment in the second proviso and the effect is an exaction of a tax, the same is beyond the legislative competence of the state legislature. Tax in dispute is not defined under the Act of 2003. What is defined is "tax due". The word payment and pre- deposit are different. The word payment used in the second proviso of Section 84(1) of the Act of 2003 cannot be read to be a deposit as the same would do violence to the plain meanings of the words used in the later part of such proviso following the word payment. Reliance is placed on the dictionary meaning of the words payment and deposit. Reliance is placed on All India Reporter 2010 Calcutta page 161 (Secretary, West Bengal Council of Higher Secondary Education v. Soumyadeep Banerjee and Ors.) and All India Reporter 1988 Supreme Court page 1263 ( Commissioner of Income Tax, U.P.- II, Lucknow v. Bazpur Co-operative Sugar Factory Ltd .). Various rules of the West Bengal Value Added Tax Rules 2005 are also placed by the petitioners to contend that, the appeal is required to be made with a payment of tax and not a deposit or a pre-deposit. An appellant cannot be taxed for preferring an appeal from an order of adjudication. When tax is not defined, it is to be understood to cover any levy. Reliance in this regard is placed on 2001 Volume 6 Supreme Court Cases 697 (Commissioner of Central Excise, Meerut v. Kisan Sahkari Chinni Mills Ltd.). The authorities can at best seek a deposit or a pre-deposit to secure the tax due and adjudicated to be found due. The words deposit or pre-deposit are not used. What is used is payment. The words used in the second proviso to Section 84(1) do not embrace in its fold the concept of refund. The Act does not provide for refund in the payment made under the impugned provisions. In a given scenario, the appellant may succeed in the appeal. The order of adjudication may be set aside in its entirety. In such scenario, the impugned provision does not provide for refund of the 15% payment. In all fairness, the appellant is entitled to refund of the 15% payment along with interest. Relying upon Judgments Today 1997 Volume 4 Supreme Court page 4 ( India Carbon Ltd. v. State of Assam ) it is submitted that, the revenue is liable to pay interest on the amount deposited.
(3.) A scenario may arise where the claim of refund has been reduced by the order in original. The assessee needs to prefer an appeal therefrom. As the impugned provisions stand, the appellate authority will not entertain the appeal unless a payment of 15% of the tax in dispute is made. Such a demand for payment of 15% is an absurdity as, in such scenarios, no tax is due and payable by the assessee. Rather the quantum of refund receivable by the assessee is in dispute. Insistence of payment of 15% of the tax in dispute in such a case from an assessee is absurd. Relying upon 2000 Volume 7 Supreme Court Cases page 425 ( Consumer Action Group v. State of Tamil Nadu), 1979 Volume 1 Supreme Court Cases page 380 (In Re: The Special Courts Bill), (1986 Volume 3 Supreme Court Cases page 20 (Municipal Corporation of the City of Ahmedabad v. Jan Mohd. Usmanbhai) and All India Reporter 1992 Supreme Court page 2279 (Shyam Kishore and Ors. v. Municipal Corporation of Delhi) it is contended on behalf of the petitioners that, the restriction sought to be imposed by the amended provisions of Section 84 for the purpose of preferring an appeal are not reasonable.;