Judgment:
1. This is an application under Section 8 of the West Bengal Taxation Tribunal Act, 1987 praying for a declaration that the proviso 2, Section 79 of the West Bengal Sales Tax Act, 1994 is not applicable in appeal in respect of the period prior to March 31, 2000 and for quashing or setting aside the impugned order dated June 17, 2002 and September 18, 2002 passed by respondent No. 2 and the Appellate and Revisional Board.
2. The petitioner submitted necessary returns for the four quarter ending March 31, 2000 and assessment order was passed on April 2, 2002 by the respondent No. 1 rejecting the books of accounts of the petitioner. Being aggrieved with the order passed by the respondent No.1 the petitioner filed an appeal before the respondent No. 2. By an order dated June 17, 2002 the respondent No. 2 refused to admit the appeal and rejecting the same on the ground of non-payment of 20 per cent of the disputed amount of tax in terms of the provisions of Section 79 which came into effect from April 1, 2002.
3. Against the said order dated June 17, 2002 a revision petition was filed along with a stay petition before the West Bengal Commercial Taxes Appellate and Revisional Board (hereinafter referred to "the Board") which came up for hearing on September 18, 2002. On the same date the Board rejected the stay petition confirming the finding of the appellate authority and directed to proceed for liquidation of the demand. The order passed by the appellate and revisional authority are illegal and irrational in view of the settled principles of law and are liable to be set aside.
4. The learned lawyer for the petitioner, submits that the amended provision of the Act which came into force from April 1, 2002 cannot be made applicable in the present case, i.e., in respect of appeal for the four quarters ending March 31, 2000 inasmuch as, the return for the said period was filed before April 1, 2002 and the right of appeal since before April 1, 2002 accrued in favour of the petitioner.
5. It is further submitted that before amendment of Section 79 there was no provision for making deposit of 20 per cent of the disputed amount of tax before preferring appeal. Since the provisos of Section 79 were not given retrospective effect the appellate authority acted illegally by rejecting appeal on the ground non-payment of the 20 per cent disputed amount of tax. In support of his contention the learned lawyer for the petitioner relied on the decisions reported in Hoosein Kasam Dada (India) Ltd. v. State of Madhya Pradesh [1953] 4 STC 114 (SC) and Arasu Rubber Corporation Ltd. v. Additional Deputy Commercial Tax Officer [2002] 126 STC 32 (Mad.).
6. The learned State Representative Mr. Goswami submits that since the amendment was given effect from April 1, 2002 and the appeal was preferred on May 15, 2002, the appellate and revisional authority rightly demanded 20 per cent of the disputed amount of tax in terms of the provisos of Section 79 of the amended Act. Hence there is no illegality or irrationality in the impugned orders passed by the appellate authority and the Board.
7. The only point for consideration therefore, is, if the right of appeal is a pre-existing right and is not destroyed by amendment of the proviso of Section 79 of the West Bengal Finance Act, 2002, 8. The proviso 2, Section 79 which came into force on and from April 1, 2002 provides that no appeal shall be entertained unless appellate authority is satisfied that amount of tax, penalty or interest as the appellant may admit to be due to him has been paid and that an amount equal to 20 per cent of the tax, penalty or the interest in dispute has also been paid. The second proviso gives the power of the appellate authority to entertain the appeal without any prior payment of the said amount for the reasons to be recorded in writing. Identical point of law was raised in a case Hoosein Kasam Dada (India) Ltd. v. State of Madhya Pradesh [1953] 4 STC 114 (SC) and the honourable Supreme Court held that a right of appeal is not merely a matter of procedure but is a matter of substantive right.
9. The facts of the case were similar to those of the present one. In that case the return was submitted on November 28, 1947. Assessment was made on April 8, 1950. The amended Act came into force on November 25, 1949. The appeal preferred by the assessee was not admitted on the ground of non-payment of tax as provided under law. The contention of the petitioner was that the case of the petitioner should be governed by the previous provisions of the Act as it stood when the assessment proceedings were started, i.e., before the amendment of the Act. The honourable court disposed of the matter in favour of the petitioner and held as follows : "The imposition of the restriction by the amendment of the section could not affect the assessee's right of appeal from a decision in proceedings which commenced prior to such amendment and which right of appeal was free from such restriction under the section as it stood at the time of the commencement of the proceedings.
Consequently the assessee's appeal should not have been rejected on the ground that it was not accompanied by satisfactory proof of the payment of the assessed tax." Thus we find that right of appeal from the decision of a Commercial Tax Officer or Assistant Commissioner, Commercial Taxes to a superior forum becomes vested in a party when proceedings are first initiated and before a decision is given by the such assessing authority. Since the pre-existing right of appeal continues to exist the necessary presumption will be that the old law--created such right of appeal must exist to support the continuation of that right.Garikapati Veeraya v. N. Subbiah Choudhry AIR 1957 SC 540, formulated the principles, from the decisions in Hoosein Kasam Dada (India) Ltd. v. State of Madhya Pradesh [1953] 4 STC 114 (SC) ; AIR 1953 SC 221, Ganpat Rai Hiralal v. Aggarwal Chamber of Commerce Ltd. AIR 1952 SC 409, R.M. Seshadri v. Province of Madras AIR 1954 Mad. 543. In re reference under Section 5, Court Fees Act AIR 1955 Bom 287 and in Sawaldas Madhavdas v. Arati Cotton Mills Ltd. AIR 1955 Bom. 332, and has held as follows : 'From the decisions cited above, the following principles clearly emerge : (i) That the legal pursuit of a remedy, suit, appeal and second appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding.
(ii) The right of appeal is not a mere matter of procedure but is a substantive right.
(iii) The institution of the suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit.
(iv) The right of appeal is a vested right and such a right to enter the superior court accrues to the litigant and exists as on and from the date the 'lis' commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law prevailing at the date of the institution of the suit or proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal.
(v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise'." 10. In view of the principles laid down by the honourable Supreme Court we hold that the learned Assistant Commissioner, Commercial Taxes and the learned Administrative Member of Board were not justified by rejecting the prayer of the petitioner. The proper appreciation of the settled principles of law unfortunately were not made by the learned Assistant Commissioner and learned member of the Board. The impugned orders dated June 17, 2002 and September 18, 2002 passed by the respondent No. 2 and the learned member of the Board are liable to be set aside. The direction given by the learned administrative member of the Board for liquidation of the demand is also not in accordance with law.
11. We, therefore, allow this application without any cost and direct the appellate authority, i.e., the learned Assistant Commissioner, Commercial Taxes to admit the appeal in view of the findings made above and dispose of the same in accordance with law.
12. The learned State Representative prays for stay of operation of the order. Other side raises serious objection. We do not find any ground for staying the operation of the order, since no prejudice is going to be caused to the revenue at this stage. They are at liberty to move before the higher forum.