The main legal point established is that the Tribunal can only waive tax if the assessee is unable to pay tax, and it does not have jurisdiction to waive tax based on the belief that the disputed turnover may not be liable for tax.

V.Ramaswami, J.

1. This is a petition under Article 226 of the Constitution of India praying for quashing of the order of the Sales Tax Tribunal, Punjab, in Appeal No. 138 of 1985-86, directing the petitioner to deposit Rs. 29,65,651 as a condition precedent for hearing of the appeal on merits.

2. The petitioner is a statutory Corporation incorporated under the Food Corporation Act, 1964. They are engaged in the business of trading in foodgrains and other food-stuffs. They are also registered dealers both under the Punjab General Sales Tax Act as also the Central Sales Tax Act. For the assessment year 1971-72, they are assessed on gross turnover of Rs. 7,57,59,684.80 and taxable turnover of Rs. 1,50,145.62 and the tax payable was determined at Rs. 97,81,032.58. As against this assessment order they preferred an appeal under Section 20 of the Punjab General Sales Tax Act. Along with the appeal they filed an application under Section 20(5) of the said Act for exempting them or waiving the payment of tax to the extent of Rs. 29,65,551, the rest of it having been paid by them earlier. The petition was filed mainly on the ground that the turnover relating to this disputed tax was not taxable in view of the Division Bench judgment of this Court reported as Food Corporation of India v. State of Haryana [1987] 66 STC 7. However, probably in view of the fact that the Tribunal had power to waive the tax only if it is satisfied that the dealer is unable to pay the tax, they also raised a ground that they will be unable to pay the tax and the financial situation of the Corporation is so precarious as to require the prayer for waiving of the tax. Even if the petitioner is well-founded in its contention, that as per the decision in Food Corporation of Indias case [1987] 66 STC 7 (P & H) it may not be liable to pay any tax at all on the disputed turnover, still we are of the view that the Tribunal has no jurisdiction to waive the tax on that ground. The only ground on which the Tribunal can waive the tax is that the assessee, in its view, is not able to pay tax. In this case, the Tribunal was of the view that the contention of the Corporation that they are unable to pay tax could not be accepted and that is a finding of fact with which we could not interfere in proceedings under Article 226 of the Constitution. In the circumstances, therefore, neither we can substitute the satisfaction of the appellate authority on the question whether the dealer is unable to pay tax or not, nor can we in any circumstances modify the provisions of the Act, so as to enable the assessee not to pay tax merely on the ground that he is confident that on merits no tax is liable.

3. In the circumstances, the writ petition fails and it is dismissed. However, we direct the appellate authority to dispose of the appeal within a period of six months from the date on which it is admitted. The writ petitioner is also given time for depositing the amount within a period of two months. If the amount is deposited within a period of two months, the appeal shall be taken on file and admitted.