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2015 (7) TMI 1072 - HC - VAT and Sales TaxValidity of order of Commissioner - Violation of principles of natural justice - Denial of reasonable opportunity of being heard - Appellant contended that the two days time granted to them from February 20, 2002 to February 22, 2002 was extremely short, and they were thereby denied the opportunity to prepare their case - Held that:- the fact remains that the appellant was granted two adjournments firstly for a fortnight from December 27, 2001 to January 11, 2002; and, thereafter, for more than a month from January 11, 2002 to February 22, 2002. As the order of the Commercial Tax Officer, which was sought to be revised, was passed on March 20, 1998, the four year period of limitation, prescribed under section 20(3) of the APGST Act, was to expire in March, 2002. In order to avoid the possibility of the revisional order getting barred by limitation, and as a copy of the order was also required to be served on the appellant thereafter, the Commissioner passed the revision order on February 26, 2002. The appellant was granted a reasonable opportunity of being heard and their contention, that the order of the Commissioner dated February 26, 2002 is in violation of the principles of natural justice, does not merit acceptance. Is the Commissioner of Commercial Taxes barred from exercising his powers of revision - Section 20(1) of the APGST Act - Appellant contended that as the APGST Act did not provide for a second revision, the Commissioner of Commercial Taxes could not again revise the order of the assessing authority as the said order had already been subjected to revision by the Deputy Commissioner - Held that:- it is necessary to note that the exemption granted by the assessing authority, for the second sales of HDPE bags, was not the subject-matter of revision by the Deputy Commissioner of Commercial Taxes. As such a power is explicitly conferred under section 20(1) of the APGST Act, the submission that the Commissioner, Commercial Taxes, lacks jurisdiction to revise the order of the assessing authority, when it has been subjected to revision by the Deputy Commissioner albeit on a different ground, is not tenable. Validity of leviability of tax - Packing material i.e. HDPE bags and its contents taxed at the same rate - Appellant contended that the sale of cement was not dependent on the HDPE bags, as it could be sold loose or in a gunny bag or in a paper bag and HDPE bags are classified in item 188 of the First Schedule to the APGST Act; they are durable and reusable; they are of significant value - Held that:- the Commissioner has concluded that both the seller and the buyer did not intend to sell HDPE bags; and their intention was only to sell and buy the cement contained in those HDPE bags. While the submission of appellant, that the Commissioner could not have placed any reliance on the A2 returns, without referring to it in the show-cause notice, has considerable force, the fact remains that, even if this finding of the Commissioner is ignored, his finding that there was an integrated sale of cement and HDPE bags, and the parties never intended to either sell or buy HDPE bags independent of its contents, i.e., cement, is based on an elaborate analysis of the material on record, and the prevalent practice in the cement industry. In their reply to the show-cause notice, issued by the Commissioner proposing to subject the sale of HDPE bags to tax at the rate of its contents, the appellant sought time contending that they were verifying the old records, correspondence, circulars, and stockists agreements to demonstrate an express agreement of sale of the HDPE bags. Except to produce the few sales invoices, referred to hereinabove, the appellant has not produced the purchase orders or the price charts or the quotations, if any, prepared by them and sent to their customers showing the value of cement and packing material separately. Therefore, the conclusion of Commissioner, Commercial Taxes, has been accepted that there was no intention on the part of the appellant to sell, or on the part of the consignee to buy, the HDPE bags; and these bags were used by the appellant as a convenient and cheap mode of transport and the appellant intended to sell HDPE bags only as packing material for cement, and not independent thereof. Entitlement of concessional rate of tax on production of G forms - Held that:- where the goods were sold to a manufacturer, who intended to use it as a raw material and had furnished a declaration in form G, the selling dealer was liable to pay only the concessional rate of tax of four per cent. It is the appellant's case that a part of their turnover is eligible for concessional rate of tax as G forms had been furnished. - Appeal disposed of by remanding the matter
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