“Appellant Entitled to Be Heard on Merits”: Supreme Court Sets Aside Kerala High Court’s Decision on Tax Appeal Restoration

In a landmark judgement, the Supreme Court of India has set aside orders from the Kerala High Court and the appellate authority, thereby allowing the restoration of a statutory appeal under the Kerala Value Added Tax Act, 2003. The bench, comprising Hon’ble Mrs. Justice B.V. Nagarathna and Hon’ble Mr. Justice Ujjal Bhuyan, emphasized that “the appellant is entitled to be heard on the merits of his appeal.”

The case involved an appellant who had his dealer registration under the Kerala Value Added Tax Act canceled by the Sales Tax Officer. The appellant initially filed an appeal against this decision but later withdrew it to avail a Government Amnesty Scheme. Unfortunately, he could not benefit from the scheme and subsequently sought to restore his appeal.

The Supreme Court observed, “Since the appellant did not avail such a benefit, he was entitled to be heard in the appeal on merits.” The judgement calls into question the administrative oversights by both the appellate authority and the Kerala High Court, stating that they “ought to have permitted the appellant herein to seek restoration of his appeal.”

The court also granted the appellant the liberty to seek interim relief, directing that such an application should be “considered expeditiously and disposed of in accordance with law.”

Legal experts view this as a significant decision, underscoring the importance of allowing appellants to exercise their statutory rights, especially when they fail to benefit from government schemes designed to provide relief.

Both parties have been directed to appear before the appellate authority for a hearing on the merits of the case on October 4, 2023.

Date of Decision: SEPTEMBER 1, 2023

M. PAUL vs STATE TAX OFFICER & ORS.