M/S. T.V.Sundram Iyengar And Sons Private LTD. vs. Assistant Commissioner (CT) Ltu
Held
The Court allowed the writ petition, setting aside the impugned order that rejected the stay petition. The Court granted an interim stay of recovery of the balance of the disputed tax until the disposal of the second appeal. The reasoning appears to be based on the fact that the petitioner had already paid 50% of the disputed tax and had raised significant issues for consideration in the second appeal, warranting interim protection. The ratio decidendi is that where a substantial portion of the disputed tax has been paid and arguable issues are pending appeal, a stay petition should not be rejected summarily, and interim relief is warranted to protect the assessee's interests pending final adjudication.
Facts
The petitioner, a dealer, filed a writ petition before the High Court challenging the rejection of their stay petition during the pendency of a second appeal. The petitioner had paid 12.5% of the disputed tax at the time of filing the first appeal and an additional 37.5% after its dismissal, totaling 50% of the disputed tax. The disputed issues in the appeal concerned the taxability of roadside assistance charges for new cars, tax payable on extended warranty charges for new cars, and notional input tax credit. The respondents were represented by the learned Special Standing Counsel.
Key Issues
1. Whether the rejection of the stay petition by the revenue authority was justified, considering the petitioner had paid 50% of the disputed tax and raised substantial issues in the second appeal? (Question of law and fact, turning on principles of interim relief and the merits of the appeal). The petitioner argued that the rejection of the stay petition was erroneous, especially given the substantial payment made towards the disputed tax and the arguable points raised in the second appeal. The revenue or State's contentions were not recorded in the judgment.
AI-generated summary — verify with the full judgment below
HON’BLE SRI JUSTICE V.RAMASUBRAMANIAN AND HON’BLE Ms. JUSTICE J.UMA DEVI Writ Petition No.15117 of 2018 Order: (per V.Ramasubramanian, J.) Aggrieved by the rejection of a stay petition during the pendency of a second appeal, the dealer has come up with the above writ petition.
Heard Mr. S.Krishna Murthy, learned counsel for the petitioner. Mr. Shaik Jeelani Basha, learned Special Standing Counsel, takes notice for the respondents.
The petitioner has already paid 12.5% of the disputed tax at the time of filing the first appeal. After the dismissal of the first appeal, they have paid 37.5% of the disputed tax. In other words, they have now paid 50% of the disputed tax.
The issues raised by the petitioner in the appeal are – (i) the taxability of roadside assistance charges relating to new cars, (ii) tax payable on extended warranty charges relating to new cars and (iii) notional input tax credit.
Therefore, taking into account the above, the writ petition is allowed, the impugned order is set aside and there will be an interim stay of recovery of the balance of tax till the disposal of the second appeal. The interlocutory applications, if a
The judgment continues below.
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