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VAT and Sales Tax - Case Laws
Showing 1 to 20 of 604 Records
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2022 (12) TMI 1509 - GUJARAT HIGH COURT
Refund of excess tax - Learned advocate Mr.Uchit Sheth seeks liberty for revival in case of any difficulty - HELD THAT:- This petition is disposed of with this assurance on the part of respondent-State, with a liberty to revive, in case of any difficulty.
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2022 (12) TMI 1394 - ORISSA HIGH COURT
Levy of Entry Tax - scheduled goods imported from outside the territory of India - Section 3 of the Odisha Entry Tax Act, 1999 - levy of penalty u/s10(2) of the Act - Whether levy under Section 3 of the Odisha Entry Tax Act, 1999 is attracted on scheduled goods imported from outside the territory of India? - HELD THAT:- The issue now stands settled in STATE OF KERALA AND OTHERS VERSUS FR. WILLIAM FERNANDEZ ETC. ETC. [2017 (10) TMI 491 - SUPREME COURT] where it was held that We thus do not find any substance in the submission of the learned counsel for the petitioner that entry tax legislation is not covered by Entry 52 List II. - the Court declines to frame question as urged.
Whether in the facts and circumstances of the case levy of penalty U/s.10(2) of the Act is warranted? - HELD THAT:- With the legal position having been settled only in October 2017, most of the Dealers-Assessees were under bona fide impression that Entry Tax would not payable on goods imported into India. Therefore, it could reasonably be contended that till such time there was no willful or deliberate attempt by the Dealer-Assessee to waive payment of Entry Tax.
The Court notes that under Section 10 (2) of the OET Act, there is an element of discretion in the Assessing Authority to levy penalty where the escapement or under assessment of tax “is without any reasonable cause.” Since the Court is satisfied that the non-payment of Entry Tax on imported goods by the Petitioner, cannot be said to be without reasonable basis, the Court is of the view that in the present case the levy of penalty was not justified.
The question is accordingly answered in the negative i.e., in favour of the Petitioner and against the Department. The impugned Assessment order in so far as it imposes penalty on the Petitioner is hereby set aside - Revision petition allowed.
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2022 (12) TMI 1393 - ORISSA HIGH COURT
Levy of penalty equal to two times of tax assessed under Section 43-(2) of the OVAT Act - absence of observation by the Assessing authority that the underassessment tax is without any reasonable cause - Whether, the facts and circumstances of the case, the Division Bench-II, Odisha Sales Tax Tribunal, Cuttack, is right in law to hold Section-43 provides for best judgment assessment, whose part and parcel is imposition of penalty. If the use of word “may” is liberally used then the purpose of escape assessment under VAT regime would disappear? - HELD THAT:- It is seen that in the assessment order dated 5th February, 2013 while raising a demand on the basis ‘erroneous claim of Input Tax Credit (ITC)’, the Sales Tax Officer (STO), Ganjam-I Circle, Berhampur proceeded to impose penalty under Section 43(2) of the Odisha Value Added Tax Act, 2004 (OVAT Act) without actually coming to any conclusion that ITC with differential tax wrongly availed by the Petitioner-Assessee was “without reasonable cause”.
As far as present case is concerned, the assessment order of the Assessing Officer does not record the satisfaction of the Assessing Officer that wrongful availment of ITC by the Petitioner was “without reasonable cause”. Thus, the essential component of Section 43(2) of the OVAT Act for attracting the penalty, viz., the satisfaction of the Assessing Officer that the escapement of tax was without reasonable cause, is absent in the present case.
The issue is answered in the negative, i.e., in favour of the Petitioner and against the Department and the impugned order of the Tribunal and the corresponding orders of the First Appellate Authority and the Assessing Officer levying penalty on the Petitioner under Section 43 (2) of the OVAT Act are hereby set aside - application disposed off.
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2022 (12) TMI 1378 - TELANGANA HIGH COURT
Classification of goods - Chlormint and Happydent - whether the goods sold by the petitioner, namely, Chlormint and Happydent, are to be classified as falling under Entry-88 or Item 117 of the IV-Schedule of the A.P. VAT Act, 2005 or to be considered as unclassified goods falling under V-Schedule of the Act? - HELD THAT:- Since the issue raised in the present Writ Petitions being similar to the issue which has been considered by the Sales Tax Appellate Tribunal in this State, as well as the other two High Courts, which also received approval by the dismissal of the SLP preferred there against, this Court is of the considered view that there are no justiciable grounds to take a different view there from, for us to sustain the order of assessment passed by the respondent.
This Court is of the considered view that the impugned orders as passed by the respondent-authority cannot be sustained - Petition allowed.
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2022 (12) TMI 1376 - ORISSA HIGH COURT
Violation of Section 79(4)(b) of the Odisha Value Added Tax Act, 2004 (OVAT Act) - specific averment of the Petitioner that the very purpose of which notice under Section 79(4) of the OVAT Act was issued by the Commissioner was already the subject matter of the appeal before the JCST, and that the Department itself could have gone in appeal against the said order under Section 78 of the OVAT Act has remained uncontroverted - HELD THAT:- The present petition has been pending for over six years. In the circumstances, the Court sees no useful purpose being served in relegating the Petitioner at this stage to the Commissioner for an order on the impugned show cause notice, particularly since it appears to have been issued in violation of Section 79(4)(b) read with Section 79(5) of the OVAT Act.
The counter affidavit fails to answer to the principal ground of challenge viz., that despite there being available to the Department the remedy of an appeal in terms of Section 78 of the OVAT Act, the Commissioner has chosen to exercise suo motu revisional power under Section 79 (1) of the OVAT Act. Further, there is no denial in the counter affidavit that there is statutory bar under Section 79 (4) (b) of the VSAT Act to the Commissioner exercising suo-motu revisional power since the issue was already the subject matter of an appeal.
The legal position being clear, this Court quashes the impugned notice dated 11th January, 2016 and all consequential proceedings - Petition disposed off.
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2022 (12) TMI 1329 - KARNATAKA HIGH COURT
Classification of goods - rate of GST - denatured Anhydrous alcohol is a kind of Ethyl alcohol or not - HELD THAT:- Section 3 of the KTEG Act deals with levy of tax and it specifies that “tax shall be levied and collected on the entry of any goods specified in the First Schedule into a local area for consumption, use or sale therein at such rates not exceeding 5% of the value of the goods as may be specified retrospectively or prospectively by the State Government by Notification, and different dates and different rates may be specified in respect of different goods or different classes of goods of different local areas”. In other words, the tax can be levied only by issuing a notification and not otherwise.
The notification dated 30.04.1992 issued by the Government of Karnataka in exercise of powers conferred under section 3(1) of KTEG Act, tax was levied at the rate of 2% on denatured spirit, rectified spirit and ethyl alcohol. The notification dated 31.03.1997 provided for levy tax on denatured spirit at the rate of 4%. Thereafter, a notification dated 15.02.2001 was issued exempting payment of tax on denatured spirit and also in the subsequent notification dated 30.03.2002. These notifications are not disputed by the State Government which provides for exemption from payment of tax on denatured spirit under notification dated 30.03.2002 issued in exercise of powers under section 3(1) of the KTEG Act. The levy of tax on denatured spirit have been omitted and the petitioner is not liable to pay tax for the period 2007-08 and 2008-09 and levy or payment of tax on denatured spirit is exempted.
The levy of tax is for the period 2007-08 and 2008-09 and for the said period, there was no notification issued under section 3(1) of the KTEG Act levying entry tax on the denatured spirit. Hence, the petitioner is not entitled to pay the entry tax on the denatured spirit for having purchased, manufactured or supplied it to the various petroleum companies for the said period. Accordingly, the writ petition is allowed and the clarification dated 10.02.2009 issued by the respondent No.2 at Annexure-C is hereby quashed.
Petition disposed off.
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2022 (12) TMI 1328 - ANDHRA PRADESH HIGH COURT
Jurisdiction - time limitation - whether the contention of petitioner that as second respondent has already exercised the suo motu powers of revision under Section 32(2) of the VAT Act, exercise of such powers again by the first respondent, is permissible under law? - HELD THAT:- A plain reading of Section 32(1) of the VAT Act shows that the Commissioner may suo moto call for and examine the record of any order passed or proceeding recorded by any authority, officer or person subordinate to him under the provisions of the Act, including sub-section (2), if such order or proceeding is prejudicial to the interests of the revenue. Further, a reading of same also shows that in Section 32(2) of the VAT Act, the powers of revision are also conferred on Additional Commissioner, Joint Commissioner, Deputy Commissioner and Assistant Commissioner in case of orders passed or proceedings recorded by the authorities, officers or persons subordinate to them. The powers under Section 32(2) are to be exercised by the subordinates to the Commissioner. The exercise of powers under Section 32(2) are no other than the revisional powers akin to the powers conferred on the Commissioner. There is no denial of the fact that the authorities under the VAT Act are vested with the powers to make assessment etc.
Whether the VAT dealer transferred the right to use the vehicles of him to the oil company or not is a question of fact and if the petitioner has suffered with any adverse findings in the impugned order, he ought to have challenged these factual aspects by filing an Appeal before the appellate authority but not by way of this Writ Petition under Article 226 of Constitution of India. Apart from that, the first respondent in the impugned order opined that the self serving certificate issued by the Oil Company, as regards collection of service tax cannot be taken as a valid document, when the same is disputed by the respondents. Hence, the petitioner cannot rely upon the above to support his contention.
In RASHTRIYA ISPAT NIGAM LTD. VERSUS COMMERCIAL TAX OFFICER, COMPANY CIRCLE, VISAKHAPATNAM [1989 (12) TMI 325 - ANDHRA PRADESH HIGH COURT], it was held that the agreement has to be read as a whole in order to determine the nature of the transaction to ascertain the effective control of the machinery was in the use of the contractor or that of the company.
The proper remedy for the petitioner would be to avail the remedy of Appeal in terms of Section 33 of the VAT Act. The material on record shows that the petitioner did not file the Appeal on the ground that filing of Appeal would make him to deposit 25% of the disputed tax. This cannot be a ground to file a Writ Petition under Article 226 of the Constitution, before this Court.
The Hon'ble Apex Court in SETH CHAND RATAN VERSUS PANDIT DURGA PRASAD (D) BY LRS. & ORS. [2003 (3) TMI 703 - SUPREME COURT], while dealing with scope of Article 226 of the Constitution of India held that when a right or liability is created by a statue, which itself prescribes the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before seeking the discretionary remedy under Article 226 of the Constitution. This rule of exhaustion of statutory remedies is no doubt a rule of policy, convenience and discretion and the Court may in exceptional cases issue a discretionary writ of certiorari, where there is complete lack of jurisdiction for the officer or authority or Tribunal to take the action or there has been a contravention of fundamental rights or there has been a violation of principles of natural justice or where the Tribunal acted under a provision of law, which are ultra vires. Then notwithstanding the existence of an alternative remedy, the High Court can exercise its jurisdiction to grant relief.
Petition dismissed.
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2022 (12) TMI 1294 - ALLAHABAD HIGH COURT
Validity of remanding the case - Whether, the Tribunal, being a last fact finding authority and empowered to examine and adjudicate the factual and legal issues, has erred in remanding the appeal back to the Assessing Authority when all the material for deciding the case were available on record? - HELD THAT:- Through the present revisions, the assessee has tried to raise a question of law that whether the Tribunal which is the last fact finding court and empowered to examine and adjudicate the factual and legal issue, has erred in remanding back the matter to the assessing authority when all the materials for deciding the case was available on record. The matter of remand by various authorities, Tribunals and courts have been under active consideration of this Court and also of the Hon’ble Apex Court for quite a long time.
This is a case which was before the Commercial Tax Tribunal which is the last fact finding court and clothed with both power of deciding the appeal on law and fact, had remanded back the matter to the assessing authority setting aside both orders of the assessment as well as of the first appellate authority.
In the present case, the Tribunal which was deciding the second appeal was required to frame the point of determination and thereupon records its finding and the decision taken by it, but only after noting the arguments of both the parties, the Tribunal remanded back the matter to the assessing authority to consider certain documents and make fresh assessment - The Hon’ble Apex Court in SHIVAKUMAR & ORS VERSUS SHARANABASAPPA & ORS [2020 (4) TMI 907 - SUPREME COURT] while considering the scope of remand had held order of remand is not to be passed in a routine manner because an unwarranted order of remand merely elongates the life of the litigation without serving the cause of justice. An order of remand only on the ground that the points touching the appreciation of evidence were not dealt with by the trial court may not be considered proper in a given case because the first appellate court itself is possessed of jurisdiction to enter into facts and appreciate the evidence.
In the present case, the Tribunal has not recorded any finding to the effect that the assessing authority has failed to deal any issue or has not considered the same which was essential for the right decision of the suit. The Tribunal had only required the revisionist-Company to place certain documents before the assessing authority on the basis of which the assessing authority was to arrive at the finding. The documents mentioned in the judgment was already brought to the notice of the assessing authority through the reply submitted by the assessee on show-cause notice on 12.03.2020 and the same was dealt with by the assessing authority in its assessment order - The order of remand has to be seen within the parameters of Rule 23, 23A and 25 of and not beyond that. Apart from Order 41 of CPC, there is no other provision which provides for the concept of remand. It is a borrowed provision by the taxing authorities from Code of Civil Procedure, 1908. The taxing authorities as well as the Tribunal should first understand the concept of remand before applying it. It should not be in a casual manner. Long litigation in commercial and business matter only spoils the image of the State and its functionaries and cause great loss to business world.
Tribunal was not correct in remanding back the matter to the assessing authority when all the material was before it and should have dealt with each of the material and decided the same - the order dated 08.08.2022 passed by the Tribunal is hereby set aside and the matter is remitted back to the Tribunal to decide both the appeals of the assessee in accordance with law on the material available on record, as expeditiously as possible.
The revisions stands partly allowed.
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2022 (12) TMI 1185 - ORISSA HIGH COURT
Validity of a circular dated 29th March, 2016 issued by the Transport Commissioner-cum- Chairman, State Transport Authority (STA) - direction to collect tax from the dealers/manufacturers of motor vehicles on the basis of total number of vehicles possessed and registered during the entire year by the dealer - Section 2 (8) of the Motor Vehicles Act, 1988 - HELD THAT:- There is merit also in the contention of the dealers that if the interpretation placed by the Transport Commissioner on Section 5 of the OMVT Act, as accepted by the learned Single Judge, were to be affirmed, then the requirement under Rule 7 of the OMVT Rules, 1976 of the dealers having to give a declaration regarding the number of vehicles possessed under the TC would become entirely redundant. Likewise, the declaration in Form-XIV of the OMV Rules 1993 which also contains a similar declaration would become redundant. The learned Single Judge does not appear to have, while upholding the circular dated 29th March, 2016, discussed either Rule 7 of the OMVT Rules 1976 or Form-XIV of the OMV Rules, 1993.
The concept of a TC is that it can be used on several vehicles of the same make and model which are possessed by the dealer under the TC limited to the purposes specified in Rule 41 of the MV Rules. Since the purposes for which the vehicles are used is clearly specified in Rule 41 of the MV Rules, there can be no apprehension of misuse by the dealer of such vehicles for purposes other than Rule 41 of the MV Rules. It will have to be found as a fact that there has been such misuse for which there would have to be an enquiry of some sort preceded by a notice to the concerned dealer.
This Court is unable to subscribe to the view of the learned Single Judge that the interpretation placed on Section 5 of the OMVT Act through the impugned instruction is correct and in consonance with the legislative intent behind Section 5 of the OMVT Act and the scope and ambit of that provision. In other words, this Court is of the considered view that the instruction dated 29th March, 2016 is ultra vires Section 5 of the OMVT Act and therefore cannot be sustained in law. Accordingly, this Court quashes the impugned instruction dated 29th March, 2016.
Validity of the demand notices issued by STA to each of the Appellants on the basis of the impugned instructions dated 29th March, 2016 - HELD THAT:- The TC fees can be collected strictly only in terms of Rule 81 of the MV Rules and only in respect of the vehicles which the dealer has in his possession under the TC. Accordingly, all the impugned demand notices issued to the respective Appellants both for TC tax and TC fees in respect of vehicles ‘possessed and registered’ in excess of the vehicles covered by the TC issued, are hereby quashed.
Refund of the excess TC tax and TC fees collected by the STA on the strength of the interim order passed by this Court - HELD THAT:- The question of refund of this excess amount to the dealer would arise only where that burden has not been passed on by the dealer to the customer. It is for this reason, this Court had in its order dated 18th October, 2022, called for an affidavit from the dealers. The affidavit filed by the dealers is not categorical in this regard. It merely states that “some dealers may have passed on the additional incidence to the customers whereas the others have paid it from their own resources” - it is not possible for this Court to direct refund of excess TC tax and TC fees collected by virtue of the impugned instruction issued by the STA to the RTOs. However, what is clear is that the collection hereafter of TC tax and TC fees on the basis of the impugned instructions dated 29th March, 2016 will have to cease forthwith.
Section 5 is both the charging Section as well as the ‘machinery provision’. It indicates that TC tax will become payable in respect of the vehicles possessed by the dealer under the TC certificate and also specifies what is the tax payable if the number of vehicles found in possession under the TC certificate exceeds that number. It also clearly specifies that the tax is to be collected at an annual rate and in advance - Appeal allowed.
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2022 (12) TMI 1184 - MADRAS HIGH COURT
Principles of natural justice - service of SCN - impugned order assailed on the ground that it has been made without giving notice to the writ petitioner-dealer and without affording an opportunity of personal hearing - HELD THAT:- A comparison of the signatures in the postal acknowledgement card and writ affidavit/vakalatnama reveal even to the naked eye that they are completely different. Therefore, in the considered view of this Court, there is nothing before this Court to demonstrate that the writ petitioner was put on notice before making of the impugned order.
It is settled law that an impugned order cannot be improved by way of a counter affidavit or by production of records, more so in matters of this nature. Therefore, as the impugned order does not say that a personal hearing has been afforded, which is held to be statutorily imperative by this Court in STATE BANK OF INDIA OFFICER'S ASSOCIATION (CC) – SBIOA VERSUS THE ASSISTANT COMMISSIONER (ST) [2019 (9) TMI 698 - MADRAS HIGH COURT] case in a legal drill under Section 22(4) of erstwhile TNVAT Act, this Court is convinced that the impugned order deserves to be set aside on this ground.
Impugned order is set aside solely on the ground that personal hearing has not been afforded though the impugned order says that it is a legal drill under Section 22(4) of erstwhile TNVAT Act - Petition disposed off.
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2022 (12) TMI 1183 - MADRAS HIGH COURT
Assessment of tax - calculation and clubbing of turnover of two units - sister concern or independent entities - rejection of calculation on the ground that the Registration Certificate, which was applied for Sri Annapoorna Sweets, a sister concern of Tirupur Sree Annapoorna Hotel was not accepted for registration - HELD THAT:- A perusal of the assessment order unravels the fact that the dealer, namely, Tirupur Sree Annapoorna Hotel had, though, maintained separate accounts for sweet stall and hotel, there was no set up of detached kitchen and even both concerns were functioning in the same site. There was no proof adduced regarding disbursement of salary to the employees under different salary slips and on scrutiny of bills, it came to light that bills for common telephone expenditure and electricity charges were raised. Above all, there was a common cash counter for collection of sale amount in respect of both sweets and hotel. There is not even an iota of material evidence adduced to establish that Sree Annapoorna Sweet stall is the sister concern of the petitioner herein.
The act of the petitioner herein is an attempt to swindle exchequer's money by evading payment of tax and if the contention of the petitioner that Tirupur Sree Annapoorna Hotel and Sree Annapoorna Sweets are independent entities is accepted, then the term "sister concern" will become diluted and all the firms will adopt the same tactics of creation of one or more sister concerns under one umbrella with different names and claim the benefit of tax. In that event, it will defeat the real intention of the legislature.
The Assessing Authority, in support of his assessment by clubbing both units as one, had stated that based on the divulgence of the petitioner that Sree Annapoorna Sweet Stall got merged with Tirupur Sree Annapoorna Hotel with effect from 01.04.1997, common assessment was made by branding them as a single unit. Even prior to that, the petitioner was not in possession of valid registration certificate and therefore, it cannot be contended that the petitioner is entitled to the tax benefit for the previous year.
The petitioner herein deserves no leniency from this Court, as the Tribunal has rightly analyzed the evidence on record and restored the findings of the Original Authority. Since there is a finding of fact and no question of law is involved, we are of the view that there is no perversity in the findings of the Tribunal, warranting interference by this Court - Petition dismissed.
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2022 (12) TMI 1182 - MADHYA PRADESH HIGH COURT
Refund of Excess ITR certified by the Auditor - Input Tax Rebate (ITR) - in the VAT Tax report, 75 mismatches were found - unverified ITR - Impugned order passed without application of mind without granting any justification - non issuance of show cause notice by Assessing Officer - Best judgment assessment under section20(5) of the VAT Act - non provision of report in Form 75-76 to Appellate containing details of turnover of Selling Dealers is denial of natural justice or not - failure by the Appellate Authorities to call remand report from the Assessing Officer regarding correct status and credentials of the selling dealers and merely confirming the rejection of ITR based on mismatch as per Form 75 is a correct procedure as per law - non- provision of reasons of reduction of ITR in the proceedings in assessment - increase in pecuniary liability.
HELD THAT:- Section 20 (1) of the M.P. VAT Act says that the assessment of every registered dealer shall be made separately every year. Sub-Section (4) of Section 20 provides that Commissioner shall serve on a registered dealer who is not eligible for assessment in the prescribed form, to appear in person or by an agent or to produce evidence or to produce accounts, registers, cash memoranda or other documents. Sub Section (b) provides that the Commissioner after hearing the registered dealer or his agent examined the evidence produced with requirement of section (2) and (3) of Clause (a), he may require shall assess or reassess to the tax. Therefore, proceedings under Section 20 (4) in respect of assess and re-assess is up to.
All the authorities/ Tribunal has rightly held that under proviso (6) (a) of Section 14 of the M.P. VAT Act if a registered dealer (Selling dealer) has furnished a return of a period, the tax in respect of purchase made from the registered dealer, the selling dealer ordinarily deem to have been paid for the purpose subsection unless it is found otherwise. VAT Tax report has disclosed that certain entries are not matching with the return of the selling dealer, therefore, the appellant was called upon under Section 20(5). Then under Section 15, the burden of proving that any sale or purchase effected by a dealer is not liable to tax under Section 9 or Section 10 as the case may be, or that he is eligible for an input tax rebate under Section 14 shall be on the dealer, therefore, the burden was on the appellant to satisfy that the Input Tax Rebate for which he claimed the rebate was duly paid by the selling dealer before the sale of the goods. The authorities have recorded the satisfaction that those selling dealers did not show these sales to the appellant in their VAT Tax Return.
So far as the contention of the learned counsel of the appellant is that no details of the disputed sale were given to the appellant by the Assessment Officer is concerned all the purchases were in the knowledge of the appellant on which he claimed input tax rebate and appellant was called to produce all the details of sale and purchase for that relevant year and after examining all the record, the authorities have recorded its satisfaction that, the appellant is not liable to be given a rebate of Rs.15,44,226/-. The concurrent findings of the three authorities are not liable to interfered as we do not find any substantial questions of law involved in this appeal.
Appeal dismissed.
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2022 (12) TMI 1181 - ORISSA HIGH COURT
Attachment of bank account of petitioner - recovery of outstanding taxes of a Company from the accounts of its individual Directors - HELD THAT:- Admittedly, the assessment in the present case is in the name of the Company and throughout, it is the Company which has been treated as the Assessee and demands raised against it. While the impugned order notices that there is nothing wrong in the attachment of the Company’s account, the grievance of the Petitioner that as an individual Director who has already resigned much prior to the impugned attachment, his individual account could not have been attached was not even addressed in the impugned order.
Section 51 of the OVAT Act read with Rule 55 of the OVAT Rules provides a special mode of recovery of outstanding amount of tax, interest and penalty. Even these provisions do not authorize recovery of outstanding taxes of a Company from the accounts of its individual Directors.
This Court is unable to sustain the impugned order in so far as the said order confirms the attachment of the Petitioner’s individual Bank account notwithstanding his having ceased to be a Director of AEPL whose tax dues were sought to be recovered - impugned attachment order and the corresponding order of the Commissioner of Sales Tax, Odisha affirming it are hereby set aside - petition is disposed off.
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2022 (12) TMI 1139 - TRIPURA HIGH COURT
Validity of assessment order - Deemed sale - transfer of right to use goods or not - inter-state transfer of goods - sale or not - HELD THAT:- This court finds force in the argument of Mr. Deb, learned senior counsel on the point that respondents have no jurisdiction and there is no transfer/sale and further the situs of sale - This court is of the considered opinion that the owner of the cylinder is IOCL. The transport/supply does not fall within the ambit of transfer of goods as defined in “sale”. Further, when transaction has taken place in Assam, the respondent authorities cannot have any jurisdiction over Interstate.
The impugned Assessment Order dated 31.03.2021 and consequently, the two demand notices dated 31.03.2021 issued by the respondent no.3 are liable to be set aside and quashed on the point of jurisdiction and also with regard to the right to sale of goods and further with regard to the place of execution of the contract since the situs of the sale which has been executed at Guwahati, the State of Tripura has no jurisdiction in so far as levying of tax by the respondents upon the petitioner - Petition allowed.
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2022 (12) TMI 1138 - ORISSA HIGH COURT
Validity of suo-motu revision order dated 12th July, 2018 passed by the Addl. Commissioner of Sales Tax (Addl.CST), Cuttack-II Range, Cuttack - jurisdiction of the Addl. CST to pass an order in suo-motu revision - HELD THAT:- In terms of Rule 5(2) of the OVAT Rules, the CST cannot delegate to an officer appointed under Section 3(2) of the OVAT Act, which includes the Addl. CST and the JCST, the powers of CST under Section 79(1) of the OVAT Act “without the prior approval of the Government”. The mandatory nature of the requirement of prior approval is evident from the fact that all the delegation notifications including the one dated 15th May, 2009 specifically mentioned the prior approval obtained from the Government. However, when one peruses the notification dated 5th June, 2018 in terms of which the CST delegated his power under Section 79(1) of the OVAT Act to the Addl. CST, reference is made only the earlier approval obtained on 30th April, 2009. That approval was not for delegation of the powers of the CST to the Addl. CST but delegation of the powers of the CST to the JCST.
The observation of the CST in the impugned order that the Addl. CST, at the time when the suo motu revision order was passed on 6th December 2018, was still exercising the powers of the JCST is also not factually correct. The notification promoting the JCST as Addl. CST and posting him on promotion was issued on 2nd May, 2018 itself. Therefore, at the time when the impugned suo motu revisional power was passed by the Addl. CST he was functioning as Addl. CST and not as JCST. Even in terms of the notification dated 5th June, 2018 the Addl. CST could have exercised the suo motu revisional power only if the order under revision was passed by the JCST or Dy. CST -
Admittedly, in the present case, it is the STO who has passed the assessment order under Section 42 of the OVAT Act which was sought to be revised by the Addl. CST. Therefore, even in terms of the notification dated 5th June, 2018 the Addl. CST lacked the jurisdiction to revise the order of the STO.
The Court is of the view that the suo motu revisional power passed by the Addl. CST on 6th December, 2018 was entirely without jurisdiction and beyond the powers of the Addl. CST. Consequently, the suo motu revisional order, and the impugned order of the CST affirming it in the appeal, are hereby set aside - Petition allowed.
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2022 (12) TMI 1137 - KERALA HIGH COURT
Jurisdiction - Constitutional validity of Section 174(2) of the KSGST Act - Demand / Recovery of VAT after implementation of GST - Scope of saving clause under the GST Act - validity of notices and orders of assessment/penalty - competence of the State Legislature - Revenue, in purported exercise of saving power granted by Section 174(2) of the KSGST Act read with Section 25(1), Section 42(3), or Section 67 of the KVAT Act 2003, issued notices proposing to reopen the assessments of the Dealers, as the case may be for best judgment, penalty etc. - HELD THAT:- The State Legislature is competent to enact Section 174(2) of the KSGST Act. The consequence of such a conclusion is that clauses in Section 174(2) are within the competence of the State Legislature. To escape the saving clause's effect, the arguments noted above are canvassed. The argument proceeds on the assumption that with the repeal of the KVAT Act, an absolute right in favour of Dealers erasing and effacing every legal obligation under the KVAT Act has been attracted. The purpose of savings is intended to have certainty on initiation, enquiry, etc., even after the repeal is given effect.
Statutory obligation means an obligation arising under a Statute. Legal obligation means an obligation that derives from the operation of law. These obligations are discharged by duly complying with the requirement thereof, or the obligation stands discharged with the efflux of limitation. The third way now canvassed is that since notices are issued after 01.07.2017, the State cannot proceed to recover the amount - The absence of initiation of any proceeding before 16.09.2017 is not a criterion at all in the scheme of the KVAT Act. With the applicable saving clause, what is required in law is that when steps for reassessment etc., are taken up, those steps conform to the limitation covered by the applicable Section under the KVAT Act.
The notices now impugned are well within the period under Section 25 or within the reasonable period under Sections 56, 58 and 67; such proceedings are covered by the saving clause of Section 174(2) of the KSGST Act. The converse of the above deliberation is that the State Legislature, however, has the power to repeal and provide for a saving clause; still, on the interpretation now suggested to various clauses, again, the provisions of the KVAT Act could be rendered ineffective. The effect of the saving clause cannot be defeated on any of the grounds now raised by the Dealers. The Dealers must complete the legal obligations, or the timelines expire to assume rights either accrued or vested. It is not the case of Dealers that beyond the period of limitation, the impugned notices are issued or orders made. The migration to GST is not an amnesty given to defaulting dealers from paying the tax due under the KVAT Act - the Revenue/State has not disentitled itself from enforcing its right to recover the defaulted tax or tax dues under the KVAT Act arising before 01/07/2017.
The impugned notices are saved by clauses (i) to (iv) of Section 174(2) of the KSGST Act and are within the competence of the Department - Constitutionality of Section 174(2) of the KSGST Act and legality of notices/ orders as the case may be impugned in the respective Writ Appeals are answered against the dealers, hence necessarily, the Writ Appeals must fail and accordingly are dismissed.
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2022 (12) TMI 1106 - BOMBAY HIGH COURT
Maintainability of petition - availability of alternate remedy - time limitation - Rejection of claim for refund of octroi - only reason for rejecting and/or disallowing the Petitioner’s claim for refund of octroi was that the Petitioner had failed to produce the original declaration duly certified by the Octroi Inspector, which was done subsequently.
HELD THAT:- While the Respondent has alleged the availability of an alternate remedy, we find that no specific provision and/or details of the same have been stated. In any event we find in the facts of the present case, that the Petitioner is justified in approaching this Court under Article 226 of the Constitution of India. In so far as delay is concerned, we find that there has in fact been no delay so as to deny the Petitioner relief if the Petitioner is otherwise entitled to the same. It is well settled law that there is no rule of law, which says Courts under Article 226 of the Constitution cannot enquire into claims despite the passage of time. The test is to see whether the illegality complained of is manifest and whether the same can be sustained solely on the ground of laches.
The test is not the physical running of time but the fact that justifiable reasons exist for warranting a Courts action in cases where injustice has been done or justice has been denied. All that the Court has to see is whether the delay and laches on the part of the Petitioner is such as to disentitle a Petitioner of the relief claimed. It is now well settled that where a case has been made out to merit interference under Article 226 relief would not be denied solely on the ground of delay. Thus, both the preliminary grounds of objection are rejected as entirely baseless and without any merit.
Eligibility for a refund under Section 194(2) of the MMC Act - HELD THAT:- Inspector would render the Petitioner ineligible for a refund of octroi under Section 194(2) of the MMC Act. We have examined the provisions of Section 194(2) of the MMC Act and find that a plain reading of the same makes clear that the purport of Section 194(2) of the MMC Act is to exempt from octroi those articles which are imported for the purpose of fulfilling a specified contract with the Government or otherwise for the use of the Government - Section 194 (2) does not provide for an exemption of octroi at the threshold i.e. at the time of import but entitles a person/entity to claim a refund of octroi provided that such person/entity is eligible.
In the case of OIL AND NATURAL GAS COMMISSION OF INDIA, VERSUS MUNICIPAL CORPORATION OF GREATER BOMBAY, MUNICIPAL COMMISSIONER, MUNICIPAL CORPORATION OF GREATER BOMBAY, DY. ASSESSOR & COLLECTOR (O) AND STATE OF MAHARASHTRA. [2017 (9) TMI 1997 - BOMBAY HIGH COURT] the issue involved pertained to the powers of the Municipal Corporation of Greater Bombay to levy octroi on natural gas that was being imported by the Petitioner in that case (ONGC) within the Municipal limits of the Municipal Corporation of Greater Bombay. In the facts of that case Section 139 of the MMC Act specifically conferred powers upon the Municipal Corporation to impose four different types of taxes including octroi in terms of Entry 22(a) of Schedule-H - even the said judgment of ONGC is of absolutely no avail to the Respondents as the same was delivered and applicable in entirely different facts. Additionally as we have already held in the facts of the present case, the Respondent No.3 was duty bound to duly certify the octroi exemption since Petitioner had fulfilled the eligibility criteria. Petitioner could not therefore be deprived of its entitlement to octroi refund on failure of Respondent No.3 discharging its duties as required in law. Thus we hold the judgment relied upon is of no avail to the Respondents.
There are no hesitation in holding that the Petitioner is eligible for a refund of octroi under Section 194 (2) of the MMC Act of an amount of Rs.16,71,401/- paid as octroi on the said articles imported pursuant to the said work order - in the facts of the present case the failure to provide a declaration of duty certified by the octroi officer would not render the Petitioner ineligible for a refund of octroi of Rs.16,71,401/- (Rupees Sixteen Lakhs Seventy One Thousand Four Hundred and One only) paid as octroi on the said articles imported pursuant to the said work order.
Petition allowed.
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2022 (12) TMI 1105 - CALCUTTA HIGH COURT
Evasion of sales tax - concealing the sales figures of business pertaining to the year from 2009-2010 to 2013-2014 - HELD THAT:- The petitioner is now facing proceedings with civil consequences like imposition of penalty upon him. With the self same cause of action he has also been subjected to criminal proceedings as above. The criminal proceeding has been initiated without a ‘sanction’ order from the Commissioner, as envisaged in law to be mandatory precondition for initiation thereof. All these facts unfailingly point out to the inherent illegality and nullity of the proceedings initiated against the petitioner. There should not be any hesitation to hold that in case the said proceeding is allowed to be continued against the petitioner, the same would amount to be abuse of the process of court.
Revision allowed.
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2022 (12) TMI 1046 - CALCUTTA HIGH COURT
Entitlement of interest subsidy under West Bengal State Support for Industry Scheme, 2008 - Fixation of Capital Investment Subsidy (FCIS) in full - seeking total waiver of electricity subsidy in terms of the Scheme - HELD THAT:- In the matter of BHAI JASPAL SINGH AND ANOTHER VERSUS ASSISTANT COMMISSIONER OF COMMERCIAL TAXES AND OTHERS [2010 (10) TMI 899 - SUPREME COURT] considering the exemption notification for sales tax and VAT under the West Bengal Sales Tax Act, 1954, Hon’ble Supreme Court has held that the exemption provision should be construed strictly against the person claiming exemption and that before an exemption can be recognized, a person or property claiming exemption must come clearly within language apparently granting the exemption.
We are conscious of the fact that the aforesaid judgment have been rendered by the Hon’ble Supreme Court considering the statutory notifications relating to tax exemption whereas the notification in question concerning WBSSIS – 2008 is not a statutory notification but the broad principles stated by the Hon’ble Supreme Court will be attracted in respect of the present notification also - The above judgment make it clear that the concession notification should be strictly construed to ascertain whether the subject falls in the notification or in the exemption clause, but once the subject is found to be eligible, then liberal interpretation is to given for extending the benefit. It is also settled that while determining the entitlement, the purpose of the scheme or notification should not be defeated.
Claim relating to fixed capital investment subsidy - HELD THAT:- The writ petitioner was granted the registration certificate for assistance under the WBSSIS – 2008 dated 22nd of May, 2012 in respect of general eligibility to receive benefit under the scheme. The writ petitioner is undisputedly a unit with investment under Scale 1 and is not an ineligible unit under clause 9.1.1 - The denial of fixed capital investment subsidy on the ground that it will lead to granting of double benefit to the petitioner, cannot be sustained, as under the Scheme of subsidy, WBIDC was acting in two different and separate capacities as ‘Authorized Agent’ and as ‘Financial Institution’. Hence, we find no error in the order of the learned Single Judge in allowing the prayer for grant of fixed capital investment subsidy.
So far as the grant of total waiver of electricity duty in terms of clause 9.3 of WBSSIS – 2008 is concerned, no serious challenge has been advanced before this Court, no infirmity has been pointed out, therefore, we find no reason to interfere in that part of the order of the learned Single Judge.
Thus, no case is made out to interfere in the order of the learned Single Judge - Application dismissed.
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2022 (12) TMI 1045 - CALCUTTA HIGH COURT
Refund the amount of excess tax paid by the appellant - HELD THAT:- It would have been well open to the writ Court to grant permission to the appellant to withdraw the proceedings before the Tribunal by making necessary submission in the writ petition. In any event, there is nothing on record to point out that there was an order of assessment under both the enactments, which had culminated in a demand. There is also nothing placed on record before the Tribunal or before this Court to show that the demand was pending prior to the issuance of the refund order in Form – 27 or subsequent to the said order. The respondents are not justified in linking both the proceedings. After the issuance of Form – 27 in which it has been clearly recorded that the appellant had paid excess tax, it is the duty of the department to refund the said amount and if the amount is not refunded within time, the appellant / assessee would be entitled to interest on the same as the department seeks to recover alleged tax dues with interest. The same principle will equally apply to the department as well when they have withheld the refund though Form 27 was issued as early as on 4th August, 2016.
The sanction and payment of the excess tax collected is an independent proceedings to the proceedings that the department may initiate for any alleged tax dues either under the provisions of the WBVAT Act or under the CST Act.
Appeal allowed.
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