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VAT / Sales Tax - Case Laws
Showing 241 to 260 of 545 Records
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2023 (7) TMI 295
Levy of penalty under Section 9 (2A) of the CST Act read with Section 37 (6) of HGST Act, 1973 - Evasion of tax - Inter-State Sales shown as branch transfers - HELD THAT:- In the present case, a consignment of motor cycles destined to Ghaziabad and Secunderabad Depots were checked at STCB, Faridabad and a penalty was imposed under Section 9 (2A) of the CST Act read with Section 37 (6) of HGST Act, 1973. The verification regarding stock transfer to Ghaziabad and Secunderabad Depots from Faridabad was also made. The assessee admitted the certain branch transfer in the original return as inter state sales. The dealer filed revised returns for first and second quarter showing an enhanced turnover of interstate sales and paid additional tax - the lack of bona fides on the part of appellant’s part as he did not file the revised returns under Section 25 (4) of the 1973 Act and waited till the filing of fourth return. The appellant had deliberately filed incorrect return and omitted to pay the amount of tax due and thus contravened Section 25 (2) and 3 of 1973 Act. The penalty has rightly been imposed by the Assessing Officer.
The assesse filed his revised return when his vehicle was confiscated. The mens rea and deliberate attempt to conceal and suppress the taxable turnover by fabricating or maintaining false returns with a motive to evade the payment of tax due are the essential ingredient of Section 48 of HGST Act. No material was brought on record by the assessee to prove any deliberateness. The Assessing Officer had enough ground to impose penalty under Section 48 of the Act.
No substantial question of law arises for consideration in the present appeal and the same stands dismissed.
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2023 (7) TMI 191
Scope of clarification issued by the Revenue Department - To be retrospective or prospective - Applicability of Exemption Entry No. 8 on maize starch - overriding effect of Taxation Entry No. 61 - recovery of taxes retrospectively is a mere change of opinion or not - HELD THAT:- The Exemption Notification was erroneously held by the High Court not to have statutory backing. Recital thereof shows the source of power. Exercise of power was in terms of Section 17 of the Act, which appears to be the repository of the State Government’s power to exempt payment of tax. However, nothing really turns on it in view of the several Amendment Acts by which the Schedules were amended from time to time - Indeed, the Act was amended further with effect from 27th March, 2002 by Act No.18 of 2002, i.e., the Tamil Nadu General Sales Tax (Fourth Amendment) Act, 2002, but the same being a post-millennium event is admittedly beyond the period under consideration, i.e., 1998-99; hence, we need not be too concerned with the latter amendment.
It would appear from the conspectus of the statutory provisions as delineated above that there were two entries in the field at or about the period of the relevant assessment year, i.e., “sago and starch of any kind” in Schedule I, referred by us as Taxation Entry No.61, and “products of millets (rice, flour, brokens and brans of cholam, cumbu, ragi, thinai, varagu, samai, kudiraivali, milo and maize)” in Schedule III which we are referring to as Exemption Entry No.8.
Law is well settled that if in any statutory rule or statutory notification two expressions are used - one in general words and the other in special terms - under the rules of interpretation, it has to be understood that the special terms were not meant to be included in the general expression; alternatively, it can be said that where a statute contains both a general provision as well as a specific provision, the latter must prevail - it is thus emerged that Taxation Entry No.61 is relatable to ‘starch’ of any kind whereas Exemption Entry No.8 relates to products of ‘millet’.
The clarification vide Circular dated 8th October, 1998 was issued in exercise of power conferred by the statute (i.e., Section 28-A of the Act). Whenever a clarification pursuant to an application made by a registered dealer as to the applicable rate of tax is issued under sub-section (1), or the Commissioner on his own clarifies any point concerning the rate of tax under the Act, or the procedure relating to assessment and collection of tax as provided for under the Act is issued under sub-section (2), the object is to make the rate of tax explicit what is otherwise implicit - What the clarification provided by the Commissioner does is to clear the meaning of the two entries which was already implicit but had given rise to a confusion. A clarification of this nature, therefore, is bound to be retrospective.
The impugned judgment is upheld albeit for reasons not assigned by the High Court. Finding no merit in the appeals, the same is dismissed.
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2023 (7) TMI 104
Reversal of input tax credit against the supply - purchase of materials from a dealer whose registration has been cancelled - basis of the cancellation of registration of the selling dealer, not provided to appellant - violation of principles of natural justice - HELD THAT:- Admittedly, the details of such cancellation has not been furnished to the appellant. In any event, the appellant having availed the input tax credit against the inward supply cannot be directed to reverse the input tax credit by way of an email communication without mentioning as to what was the basis of the cancellation of registration of the selling dealer.
There are no need to travel far to examine the correctness of the direction issued by the respondent department to the appellant, without furnishing any details to the appellant, the respondent could not have directed reversal of the input tax credit, which was availed by the appellant and it is informed that the appellant was compelled to pay the amount and without prejudice to their rights have paid the amount - the procedure adopted by the authority for directing reversal of the input tax credit and thereafter compelling the appellants to pay the amount is not sustainable in the eye of law but will be in violation of the principles of natural justice.
Communication sent by the authority by an email dated 20th December, 2022 is set aside with a direction to the authority to remit the amount of input tax credit which was reversed by the appellant on effecting payment without prejudice to their right by transmitting the same amount in the appellants’ electronic credit ledger - Petition allowed.
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2023 (7) TMI 41
Calling to pay the deferred sales tax immediately - validity of G.O.Ms. No. 503 Revenue (CT-II) Department dated 08.05.2009, whereby Rule 67 of the A.P. VAT Rules, 2005 came to be amended - contrary to the industrial policy of the State Government in G.0.Ms. No. 108 dated 20.05.1996 or not - HELD THAT:- Under Section 69 read with Rule 67, all those industrial units, who availed the option of tax holiday / exemption prior to 2005, came to be converted to the unit availing tax deferment, however, with condition that the balance period of tax holiday / exemption available as on 31.03.2005 to such units shall be doubled for the purpose of tax deferment. Meaning thereby, an industrial unit having two years balance period available as tax holiday / exemption as on 31.03.2005, the same shall be converted to the unit availing tax deferment for four years, i.e., double the balance period. However, the illustration to Rule 67 provided contrary to Rule 67 and it provided for 14 years deferment.
As per the settled position of law, an illustration cannot govern the Rule but it is the Rule which shall govern and the illustration is always for clarification and it is to explain what is provided under the Rule. But the illustration cannot be contrary to the main statute namely, Rule and/or Act. Therefore, thereafter when the illustration came to be amended subsequently, vide G.O.Ms. No.503 Revenue (CT-II) Department dated 08.05.2009, to bring it in line with the statutory provision – Rule 67, it cannot be said that the same is illegal and/or contrary to the parent act and/or contrary to the original industrial scheme - In fact, the State Government has taken care of the interest of the industrial units by providing double the balance period while converting the industrial units, who earlier availed the tax holiday as the units having tax deferment. Therefore, it cannot be said that the State was not aware of the interest of the industrial units under the VAT regime.
The High Court has rightly dismissed the writ petitions upholding the subsequent G.O.Ms. No.503 Revenue (CT-II) Department dated 08.05.2009 and amendment to Rule 67 of the Rules, 2005 - The impugned judgments and orders passed by the High Court upholding the validity of the amendment to Rule 67 of the Rules, 2005 vide G.O.Ms. No.503 Revenue (CT-II) Department dated 08.05.2009 is/are hereby confirmed.
Appeal allowed in part.
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2023 (7) TMI 40
Attachment of immovable property - existence of any material to establish that there was valid publication of proclamation of attachment of the property or not - HELD THAT:- There is a clear distinction between the service of notice/warrant of attachment on the defaulter - assessee, and publication of proclamation of attachment in the manner and mode prescribed by law, as elucidated in DESH BANDHU GUPTA VERSUS. N.L. ANAND & RAJINDER SINGH [1993 (9) TMI 350 - SUPREME COURT] and M/S. MAHAKAL AUTOMOBILES & ANR VERSUS KISHAN SWAROOP SHARMA [2008 (4) TMI 710 - SUPREME COURT]. Mere passing of an order of attachment and service on the defaulter - assessee is not sufficient for constructive notice to the general public, unless proclamation of attachment is publicized in the manner prescribed by law.
It is, no doubt correct that the appellants had handed over a copy of the Attachment Warrant to the office of Sub-Registrar of Assurances, albeit it is also a fact that the register recording the attachments was misplaced in April 2004. Further, the sale deeds in favour of respondent nos. 1 and 2, namely, Amit Ahuja and Shalini Ahuja were registered by the Sub-Registrar of Assurances on 26.04.2006.
It is a need to update and revise Rule 54 to Order XXI of the CPC, as the prescribed modes of publication for proclamation of attachment are outdated. A dedicated and specific website and publication in the electronic and social media, apparently appears to be a better method to inform and alert the general public. This would be easier, less prone to challenge and more transparent and open for the public to verify and check.
It will not be appropriate and proper for this Court to interfere with the impugned judgment passed by the High Court - appeal dismissed.
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2023 (7) TMI 39
Forfeiture of the refund permitted to the petitioner - third respondent has erred in his jurisdiction in upholding the fourth respondent’s rectification order dated 12.07.2019 under Section 69 of the KVAT Act or not - HELD THAT:- In the present case, the petitioner, when not obliged to deduct any tax at Source from M/s. Ocean Interior Limited [its Contractor] as contemplated under Section 9-A of the KVAT Act, has deducted certain amount as tax and deposited the same along with interest because of its own reading of this provision. Subsequently, when the petitioner has made a request for VAT Form-156, its representatives are informed that it was not obliged under the provisions of Section 9-A of the KVAT Act to deduct the amount. The petitioner has repaid the amount to M/s. Ocean Interior Limited. Neither this fact, nor the further assertion that the contractor has filed full returns disclosing this transaction and offering tax is contested.
This Court must opine that, given the scheme under Section 47 of the KVAT Act and the circumstances in which the petitioner has deduced TDS and deposited the same notwithstanding the provisions of Section 9(A) of the KVAT Act, there could not have been a forfeiture. The petitioner has repaid the amount deducted as TDS to its contractor on being informed that it could not have deducted any amount as TDS and the contractor has also offered such amount as tax - In the present case, without any detailing, the fourth respondent has only opined that refund is not in accordance with the proceedings dated 11.07.2019. The fourth respondent, unless could explicate in the impugned order dated 12.07.2019 how the proceedings dated 11.07.2019 related to deductions made notwithstanding the provisions of Section 9-A of the KVAT Act, could not have been relied upon the same to conclude that there was a mistake apparent from the record in permitting the refund.
This Court is of the considered view that the respondents must refund a sum of Rs. 80,75,720/- in terms of Form- 185 dated 11.02.2019 (Annexure-M) within a reasonable time without interest, but if there is any delay, then must be liable to pay interest for the delayed period - Petition allowed.
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2023 (6) TMI 1481
Jurisdiction of the authority to issue the show cause notice beyond the extended period of limitation - violation of principles of natural justice - HELD THAT:- When there is a jurisdictional error, a writ is maintainable and the Writ Court will refuse to entertain a writ petition when the assessee seeks to challenge an order on disputed questions of fact. Equally, a writ petition is maintainable when a show cause notice has been issued by an incompetent authority or when there is violation of principles of natural justice. Therefore, it is required to be seen in the writ proceedings as to whether the show cause notice was issued within the period of limitation for which disputed question of fact need not be gone into.
The writ petition should be heard and decided on merits on the question of the jurisdiction of the officer to issue the show cause notice.
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2023 (6) TMI 1237
Rejection of rectification of assessment order - admission of Appeal without any pre-deposit - case of petitioner is that impugned orders are passed without giving opportunity of hearing insofar as, disallowance of input tax credit qua all the parties is concerned - violation of principles of natural justice - HELD THAT:- The Petitioner has approached this Court under Article 226 of the Constitution of India, in order to bypass the mandatory provision under the MVAT Act, 2002 which required pre-deposit of 10% of the tax for entertaining the appeal. In the facts of the present case, this approach of the Petitioner cannot be accepted moreso because against order rejecting the rectification, it had filed an appeal because according to the Petitioner against such rejection of rectification order no pre-deposit is required to be made. [This clearly shows that the present petition is filed to bypass the mandatory pre-deposit provision in entertaining the appeal].
The issue raised in the assessment order interalia qua circular trading requires factual determination which this Court cannot go into in exercise of its jurisdiction under Article 226 of the Constitution of India. It is also important to observe that by various show cause notices, the Petitioner was called upon to file all the evidences in support of its return of income and furthermore order sheet annexed to the Petition records that the Petitioner’s accountant refused to sign the proceedings sheet in relation to the circular transaction query raised by Respondent No. 2. Therefore, prima facie, the contention of the Petitioner that opportunity of hearing was not given may not be correct.
The decision of the Supreme Court in the case of State of Tripura Vs. Manoranjan Chakraborty & Ors. [2000 (11) TMI 1079 - SUPREME COURT] relied upon by the Petitioner does not assist the case of the present Petitioner in the facts of the present case. The decision of the Supreme Court was in connection where there is a high ended assessment and gross injustice done. Therefore, the decision of the Supreme Court is not applicable to the facts of the present case.
The issue raised in the present petition qua opportunity of hearing would require examination of the factual matrix in the complexion of the proceedings as they stand, which can be effectively adjudicated more appropriately by the Appellate Authority - the Petitioner relegated to avail the alternative remedy of an appeal - petition disposed off.
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2023 (6) TMI 1236
Calling for the records pertaining to the Petitioner’s case and after going into the validity and legality thereof to quash and set aside the impugned Order - direction to Respondents themselves, their officers and subordinates to withdraw and/or cancel the impugned Order dated 11.12.2018 passed by the Respondent No. 2; and to refrain from taking any steps or proceedings in pursuance of and/or in furtherance of and/or in implementation of impugned Order dated 11.12.2018 passed by the Respondent No. 2 - benefits of the exemption granted vide Notification No. DNH/CST/4-1/99/4 dated 31.12.1999 and Notification No. ADM/LAW/CSR/2/84 dated 04.01.1984 without the production of C Forms.
HELD THAT:- The petitioner has drawn our attention to the judgment and order dated 30 August, 2012 passed by a co-ordinate bench of this PRISM CEMENT LTD & AKSHAY RAHEJA VERSUS STATE OF MAHARASHTRA, FINANCE DEPARTMENT & OTHS. MUMBAI [2013 (7) TMI 668 - BOMBAY HIGH COURT] to the order passed on Voltas Ltd. and Anr. Vs. Commissioner of Sales Tax, Dadra & Nagar Haveli, Silvassa and Ors.) dated 03 September, 2012, as also to another order of even date in case of Universal Comfort Products Pvt. Ltd. & Anr. Vs. Commissioner of Sales Tax, Dadra & Nagar Haveli, Silvassa & Ors. to contend that the issue as arising in the present petitions is squarely covered by the decision in Prism Cement Ltd. & Anr. Vs. State of Maharashtra and Ors. as also in cases of Voltas Ltd. and Anr. Vs. Commissioner of Sales Tax, Dadra & Nagar Haveli, Silvassa and Ors. and Universal Comfort Products Pvt. Ltd. & Anr. Vs. Commissioner of Sales Tax, Dadra & Nagar Haveli, Silvassa & Ors.
The orders passed by the Division Bench in Voltas Ltd. and Anr. Vs. Commissioner of Sales Tax, Dadra & Nagar Haveli, Silvassa and Ors. by which the Division Bench disposed of the said case following the decision in case of Prism Cement Ltd. & Anr. Vs. State of Maharashtra and Ors held that the petitioners have challenged the validity of the Circulars at Exhibits S, U, V & W to the petition. Counsel for the parties state that this Court in the case of Prism Cements Ltd. V/s. State of Maharashtra & Ors. has quashed similar circulars issued by the Commissioner of Sales Tax, State of Maharashtra.
Petition allowed.
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2023 (6) TMI 1235
Sale of High Speed Diesel (for short ‘HSD’) to various private industries of three States viz. Gujarat, Maharastra and Madhya Pradesh at concessional rates of sales tax without complying with the mandatory requisite permission from the Ministry of Petroleum & Natural Gas - diversion thereof has caused huge revenue loss to the Government and wrongful gain to the concerned - whether C.B.I. had any case to even lodge a prosecution?
HELD THAT:- Admittedly CVC too had not found any case against the accused to grant sanction.
The compilation and circulation by OCC on 08.07.1991, of the Guidelines for Release of Petroleum Products and Lubricants to Direct Consumers have not been denied, which suggests that the same was in force and all oil companies were following the guidelines since 1991. The charge-sheet has been filed for period between 1997-2000. The guidelines of OCC dated 08.07.1991 had not found any change. Mr. Shastri had referred in his Fax message of no change in the guidelines for allocation of HSD to processors. According to him, HSD allocation to the processors is approved by the MoP&NG based on the certification and recommendation of the TEC of the Oil Companies. The guidelines referred and relied upon does not reflect any certification and recommendation of the TEC to the oil companies, and, when a clarification was sought by P. Sudarsnam by a letter dated 23.08.1999, Mr. Shastri states before the C.B.I. that there was no change in the allocation policy and requested P.Sudarsnam of IOC not to make HSD supplies to the processors without the Ministry’s allocation / Linkage, and, since clarification was sought by the E.D., IOC from OCC, reply was sent by OCC, which stated by Mr. Shastri, according to the existing guidelines available, the directions were to be followed by the oil companies necessarily, and according to him the clarification was in accordance with the existing guidelines of the Ministry, and, in the present case, to his clarification on behalf of OCC, Ministry did not issue any such amendment, which implies, concurrence of the MoP&NG on the particular issue, upon which the Oil Companies were required to act accordingly.
It is required to be noted that TEC was dissolved with effect from 01.04.2002; the non-requirement of the TEC had been noted in the letter dated 27.03.2002.
The C.B.I. while filing the F.I.R. has failed to take a clarification from the authorized person of the Ministry as to why the Circular dated 02.01.1981 was only addressed to IOCL for the utilization of HSD from Koyali Refinery and not for any other oil companies. While the guidelines of the OCC does not refer to the requirement of TEC recommendation for uplifting HSD from any other oil companies. All the letters/circulars referred earlier hereinabove with the communication starting from 1988-1996 require TEC evaluation only for supplying LSHF-HSD/High Flash-HSD, LDO and Crude Sludge to processors for the manufacture of petroleum specialities - All the companies were clear on the fact that in the year 1991, the MoP&NG had issued the instruction vide letter/circular dated 2/6.1.1981 for instituting a procedure for utilization of HSD from Koyali Refinery and not from any other refineries, and the Ministry had addressed by Circular dated 17.03.1988 to all the oil companies regarding the constitution of TEC on supply of feed-stock for the production of petroleum specialities, by making a reference to the Ministry’s letter dated 02.01.1981, for reconstitution of the TEC; it was clarified that it would initially look into the supply of LSHF-HSD, LDO and Crude Sludge for the manufacture of petroleum specialities. There was no reference with regard to the supply of regular HSD.
There was no reason for the C.B.I. to file charge-sheet against any of the accused. None of the communications of the Ministry, except of 02.01.1981, for the utilization of HSD from Koyali Refinery, required any TEC recommendation for lifting of HSD from any other companies. The C.B.I. failed to take into account that the Ministry had never called for any clarification from any other company during the period between 1997 – 2000 in connection with the alleged facts noted in the F.I.R., the officers, who were working in the company, would go by the understanding of the Circulars.
The learned Special Judge observed that as per the record, four oil companies are of Gujarat, Maharashtra and Madhya Pradesh and there is no evidence to show that the officers of the oil companies had gathered, or met sales tax officers or staff or purchasers with an intention to commit the alleged offence - For the offence under the P.C. Act, the learned Special Judge found that there is no prima facie evidence to show that the applicants had accepted any gratification from any person as a motive or reward, and the applicants accused had followed all the instructions issued by the MoP & NG and acted in discharge of the duties; no sanction has been brought on record by the C.B.I., while sanction has been refused against the officers of the oil companies and against refusal C.B.I. had written to Central Vigilance Committee, but the said committee to confirm the order of non-issuance of sanction against the officers of the oil companies and therefore, no summons were issued against those accused persons.
The Petroleum Rules, 2002 came into force on 13.03.2002. A technical body being Oil Industry Safety Directorates Standards (OISD) had been formed for assisting the safety council constituted under the MoP&NG. The rules deals with restrictions of delivery and dispatch of petroleum in all classes A, B and C, the requirement of the licence for the import of petroleum, and the dispute with regard to the HSD would have to be resolved by the Board, which is governed by the Petroleum and Natural Gas Regulatory Board Act, 2006. The legal provision of the Petroleum Act and rules thereunder become relevant in this case, since chargesheet came to be filed on 25.03.2009.
This Court finds that the Special Judge has not committed any error in discharging the accused. No sanction has been granted for prosecuting the officers of the oil companies. The assessment made by the Special Judge discharging the accused is consistent with the record - the orders passed by the learned Special Judge discharging the accused – respondents herein are just and correct, the findings are in accordance to the documents on record, the accused are rightly discharged, as there are no sufficient grounds for proceedings against them.
All the present revision applications fail merits and are dismissed as rejected.
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2023 (6) TMI 1230
Issuance of Suspension proceedings - Action on enquiry report - petitioner were put under suspension without any basis and without following the procedure prescribed under the A.P. Civil Services (Classification, Control and Appeal) Rules, 1991 - HELD THAT:- It is manifest that the respondent authorities already conducted detailed enquiries on two occasions i.e., on 16.04.2021 and 19.12.2022, and by relying the said enquiry reports and without observing the principles of natural justice and without providing any opportunity to the petitioner to submit an explanation, the present impugned orders came to be passed by de horsing the procedure as contemplated under Rules 21 and 22 (1) of the CCA Rules, 1991.
On a perusal of the Rule 8 (1), this Court is of the opinion that Rule 8(1) is not applicable, since the enquiry was already completed twice in the present case and the enquiry reports were submitted by the Inquiry Officers on 16.04.2021 and 19.12.2022.
As per service jurisprudence, as stated by the respondents, that the notice is contemplated under Rule 8(1) of CCA Rules before issuing impugned proceedings is misconception, but in the given facts and circumstances and also as per the circular issued by the Central Vigilance Commission (CVC), if any enquiry or anyaction is proceeded by the disciplinary authority basing upon anonymous letters/complaints by third parties or news reports, the authority under obligation to issue prior notice to concerned delinquents before any enquiry/action. The detailed enquiries were already conducted and basing upon the enquiry reports, the present impugned orders were passed.
As seen from the impugned order, it is crystal clear that no show cause notice and no charge memo were issued to the petitioner to submit his explanation and no opportunity was given to him to participate in the enquiries said to have been conducted by the respondents. The fact remains that the enquiries were not conducted as per the CCA Rules, 1991 without complying the procedure as contemplated under Rule 20 of CCA Rules, 1991 - It is also settled principle of law that, basing upon anonymous letter or complaint from the public and news reports, neither the disciplinary proceedings nor punishment can be proceeded/imposed/awarded.
The enquiry reports dated 16.04.2021 and 19.12.2022 cannot be relied upon. Therefore, the power of suspension is only to be used to achieve the object to keep the delinquent away from the records and witnesses at the time of enquiry, but here enquiry was already completed, and the power cannot be used as a means of punishment. In fact, the present impugned proceedings does not speak any administrative exigencies, but due to the enquiry reports which are unknown to the petitioner, the impugned proceedings were issued for other reasons particularly as punitive measure only.
The respondents did not follow due process of law before issuing the impugned orders, which would attract the principle of malice in law as the impugned order was not based on any real factor germane and it was based upon the allegations made against a unit of Department in a news item published in a Telugu Newspaper on 04.04.2021. Admittedly, the petitioner never discharged his duties at the subject unit and his duties do not at all relate to collection of tax as alleged - Petition allowed.
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2023 (6) TMI 1191
Denial of claim for concessional rate of tax and claim for sales returns - no C Forms to support the claim for concessional rate of tax - claim of the petitioner rejected on the ground that the claim for sales return had not been made within the time contemplated under the statute - differential demand of tax on the petitioner - HELD THAT:- While considering claims for exemption from tax, the burden of proof is strictly on the petitioner to demonstrate that he fulfils the conditions for claiming the exemption, and the statutory provisions in that regard must be strictly construed in favour of the revenue and against the assessee - In the instant case, it is found that the statutory provision mandates that any claim for sales return be made within a period of six months from the date of the sale transaction, and admittedly, in the instant case, the claim for sales returns was made beyond that period.
There are no reason to interfere with the order passed by the Appellate Tribunal, which conforms to the well-settled principle in taxation that a statutory provision providing for an exemption has to be strictly construed in favour of the revenue and against the assessee.
The questions of law raised in this revision petition have to be answered in favour of the revenue and against the assessee - Petition dismissed.
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2023 (6) TMI 1150
Rejection of request of the appellants/writ petitioners for waiver of tax arrears and penalty - HELD THAT:- As the Assessee has decided to go before the Authority, the Assessee, as a matter of right cannot demand that the entire waiver shall be granted. The Authority has the power either to waive or reject the waiver in its entirety and he also has the power to demand a higher perccentage as an interim measure till the issue is finally decided. In case, the Authority concerned accepts the case of the Assessee, the excess amount, if any collected will have to be refunded to the Assessee. The Authority, while passing a final order can either accept 4% or 12.5%, depending upon the acceptance of the contentions of the parties, but cannot increase the percentage from 4% or reduce it from 12.5%.
The order of the learned Single Judge need not be interfered with, since the entire issue is at large and the issue has to be decided on merits, in order to give a quietus to the entire issue and the matter being pending before the authorities, as an interim measure, the respective appellants can be directed to pay another 4% of the tax. Accordingly, the respective appellants are directed to pay 4% of the tax determined by the authorities, apart from 4% already remitted, i.e., Total 8% (4% + 4%) within a period of four weeks from the date of receipt of a copy of this order - the matter is remitted back to the authority concerned for passing appropriate orders on merits and in accordance with law.
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2023 (6) TMI 1100
Maintainability of Review petition - error apparent on the face of the record - HELD THAT:- There is no error apparent on the face of the record, warranting reconsideration of the order impugned.
The Review Petitions are, accordingly, dismissed.
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2023 (6) TMI 1099
Exemption from U.P. Trade Tax Act - PVC coated cotton fabrics - to be included in Entry 53 or under Chapter 59.03? - HELD THAT:- This Court has independently considered the reasoning of the High Court and concurs with it. The reliance placed by the appellant on the classification in the Central Excise Tariff, is of little consequence since the terminology used in Chapter 59 under the relevant heading is different. Chapter 59 is far more nuanced than Entry 53 of the U.P. Trade Tax Act.
In these circumstances, having regard to the express terms of Item 53 which is in question in the present case, this Court is of the opinion that no cause for interference has been shown.
SLP dismissed.
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2023 (6) TMI 1098
Amount of penalty for compounding the offence - grant of right to the applicant to be treated as registered dealer eligible to claim input tax credit and/or collect tax on sales - Section 53 of the Goa Value Added Tax Act, 2005 - HELD THAT:- The grievance of the petitioner with regard to penalty of Rs. 1,00,000/- being imposed by the impugned order would be required to be accepted being ex facie contrary to the provisions of the Act. Even assuming as to what has been stated on behalf of the Revenue that a penalty of Rs. 25,000/- would be maximum penalty under Section 44 of the Act or even if the petitioner is right in his contention that the maximum amount of penalty would be Rs. 10,000/- under notification dated 2 February, 2012 issued by the State Government on either of the Counts, the impugned order which orders a penalty of Rs. 1,00,000/- cannot be sustained.
Insofar as the petitioner’s grievance with regard to the wording of the operative part of the order as noted above, the grievance raised by the petitioner is quite correct, although such observation may be clarificatory in nature, it has some consequence, more particularly when the substantive appeal itself is pending before the Appellate Authority assailing the Assessment Order.
It would be in the interest of justice that the impugned order dated 30 July, 2021 is required to be set aside. It is accordingly set aside directing the Commissioner of State Tax to hear the petitioner afresh on the issue of penalty and de hors pass a fresh order in accordance with law - Petition disposed off.
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2023 (6) TMI 990
Recovery of sales tax - transfer of the right to use any goods - Power of Revenue Dept. to direct deduction at Source for payment of Sales Tax from Bills of any person who transfers right to use any goods for any purpose - Rule 3A(2) is a valid piece of delegated Legislation or not.
Whether Sub-rule (2) of the Rule 3A of the TST Rules can be declared ultra vires being contrary to the provisions of the ‘TST Act’, though there is express proviso in Section 3(1) for levy of 4% Sales Tax on any transfer of the right to use any goods for any purpose?
HELD THAT:- In exercise of the powers under Section 44 of the TST Act the State Government had enacted the TST Rules which were placed before the Legislative Assembly. On fair reading of Section 44 of the Act which is a rule making power it can be seen that the rule making power under Section 44 is inclusive and wide enough to cover the procedure for recovery including tax deduction at source.
Section 3 of the TST Act can be said to be the charging Section and the liability to pay the tax shall be as per Section 3 of the TST Act. As per Section 3(1) of the TST Act every dealer in taxable goods shall pay a tax on his turnover at the rate specified in column (3) of the Schedule. As per the proviso to Section 3(1) as inserted by Tripura Sales Tax (Fourth Amendment) Act, 1987 w.e.f. 12.05.1987 the rate of tax on any transfer of the right to use any goods for any purpose (whether or not for a specified period) shall be 4%. The ‘Sale’ is defined under Section 2(g) and it means any transfer of property, in goods for cash or deferred payment or other valuable considerations, and includes any transfer of the right to use any goods for any purpose for cash, deferred payment or other valuable consideration, and such delivery or transfer of any goods shall be deemed to be a sale of those goods by the person making the delivery or transfer and purchase of those goods by the person to whom such delivery or transfer is made. Thus, any transfer of right to use any goods including the vehicles shall be deemed to be a ‘sale’ as defined under Section 2(g)(ii) - the submissions on behalf of the respondents – suppliers/transferers that as there is no sale or transfer of the goods and that they are not registered with the TST Act and therefore, the liability to pay the tax at 4% does not arise cannot be accepted. As observed, the liability to pay the tax shall be on the transferer who transfers the right to use any goods as per proviso to Section 3(1) read with Section 2(b) and 2(g) of the TST Act.
Whether Rule 3A(2) of the TST Rules and the memorandum issued by the Government to deduct the tax at 4% and the bills to be paid to the transferers can be said to be ultra vires to TST Act? - HELD THAT:- It appears that the High Court has held the said provision as ultra vires by observing that there is no such provision for tax deduction at source under the TST Act and therefore, the Rule cannot go beyond the Act. The aforesaid view taken by the High Court is absolutely fallacious. Rule 3A(2) can be said to be a recovery machinery/mechanism. What Rule 3A(2) provides is only for a machinery/mechanism where the person buying the goods is required to deduct the tax at source and deposits the same with the Revenue. It does not in any manner change the chargeability of the tax or liability of the tax which is under Section 3(1) of the TST Act read with Section 2(b) & 2(g) of the TST Act.
The rules are framed in exercise of Rule-making power under Section 44 of the Act and in that view of the matter and as the liability to pay the tax on transfer of right to use the goods shall still be continued under proviso to Section 3(1), mere providing for mode of recovery and/or providing for machinery/mechanism to recover the tax to be paid by the transferer/supplier from the person buying the goods deducting the tax at source and depositing the same with the Revenue cannot be said to be ultra vires to TST Act and the Rules as observed and held by the High Court - the High Court has fallen in error in misinterpreting Rule 3A(2) of the TST Rules and has fallen in error in declaring Rule 3A(2) of the TST Rules ultra vires to TST Act and the High Court has materially erred in quashing and setting aside the memorandum issued by the State Government requiring the hirers namely the ONGC and the GAIL to deduct an amount equivalent to 4% out of the respective bills of the suppliers of the vehicles.
The order passed by the learned Single Judge declaring Rule 3A(2) of the Tripura Sales Tax Rules, 1976 as ultra vires to the Tripura Sales Tax Act, 1976 and quashing and setting aside the memorandum of 1992 issued by the State Government requiring the hirers to deduct an amount of tax at 4% out of the respective bills of the suppliers of the vehicles are hereby quashed and set aside - appeal allowed.
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2023 (6) TMI 896
Cancellation of the permission to pay tax on compounded basis for the year 2015-16 - alleged shifting of business premises - principles of interpretation - HELD THAT:- The statutory provision that enables an assessee to pay tax on compounded basis [Section 8(f) of the KVAT Act] does not mandate that the assessee should not change its place of business during the year in which it has sought to pay tax on compounded basis. The provision of sub clause (iv) of Section 8(f) only empowers an Assessing Authority to cancel a permission already granted for valid and sufficient reasons such as shifting of place of business, furnishing of false information, suppression of relevant information, failure to furnish such information demanded etc. It can be seen therefore that sub clause (iv) of Section 8(f) uses the phrase 'shifting of place of business' along with other phrases such as 'furnishing of false information', 'suppression of relevant information' etc. to denote those reasons which are treated as valid and sufficient by the Statute for the purposes of cancellation of a permission already granted.
It is a settled principle of interpretation of statutes that the true scope and ambit of a phrase used in a statute must be gathered from the other words/phrases which are used along with it in the statutory provision. The principle of noscitur a sociis is a rule of interpretation that stipulates that where the general words in a statutory text are flanked by restricted words, the meaning of the general words are taken to be restricted by implication with the meaning of the restricted words. The Latin term, noscitur a sociis contemplates that a statutory term is recognised by its associate words.
On applying the principle of noscitur a sociis, to determine the scope and ambit of sub clause (iv) of Section 8(f), it can be safely stated that the shifting of a place of business can be cited as a valid and sufficient reason for cancelling a permission already granted only if such shifting is without the knowledge of the Assessing Officer and thereby had an element of suppression of relevant information or failure to furnish relevant information.
Justification refers to the principle that the exercise of public power must be justified, intelligible and transparent, not in the abstract, but to the individuals subject to it. Demonstrated expertise refers to the requirement of the decision maker establishing the reasonableness of his decision by demonstrating therein his experience and expertise. On the facts in the instant case, it is not found that the Assessing Authority or the Tribunal to have indicated or provided a clear justification for the action of the Assessing Authority in cancelling the permission that was granted to the petitioner to pay tax on compounded basis for the assessment year 2015-16. The cancellation of the permission already granted was illegal and unreasonable, and hence, liable to be set aside.
The O.T. Revision is allowed.
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2023 (6) TMI 895
Violation of principles of natural justice - opportunity for cross-examining the driver of the lorry not provided - Validity of assessment order and penalty - attempt to fraudulently bring goods into the State - HELD THAT:- The specific contention of the petitioner that he had not been given a reasonable opportunity to prove that the transactions were fraudulent in nature and that the consignments were not intended and did not reach him requires consideration - the contention of the respondent that an opportunity to cross-examine the driver of the vehicle would not be practical in the circumstances, is accepted.
The petitioner was entitled to be granted reasonable opportunity to substantiate his contention that the consignments were not intended for delivery to him. It is clear from the orders of assessment that the contention of the petitioner that interstate purchase had not been effected by him and that he has to be granted an opportunity to rebut the allegations levelled against him has been rejected largely relying on Section 9 of the KVAT Act stating that the burden of proving that any transaction of a dealer is not liable to tax under the Act shall lie on the dealer. Reasonable opportunity” as provided in the statute has to be a full and proper opportunity to the dealer not only to raise his contentions, but also to make available and rely on material which would support his contentions - In the instant case, the petitioner had relied on a letter dated 28.7.2012 by which he had informed the authorities that there was an attempt to misuse his TIN for bringing in consignments into the State. It is to be noted that it was only from 1st February, 2012 that the electronic filing of declaration in Form 8F had been made mandatory. The assessment years are 2011-12, 2012-13, 2013-14.
In the facts and circumstances of the instant case, the petitioner ought to have been given a full and proper opportunity to substantiate his contention that the consignments which passed the check posts purportedly in the name of the petitioner were actually not intended for delivery to the petitioner. The assessment completed and the penalty imposed without giving such an opportunity to the petitioner is, therefore, unsustainable for want of a reasonable opportunity being granted to substantiate his case.
The impugned orders are set aside. There will be a direction to the respondents to give the petitioner a reasonable opportunity to place on record any material to show that the consignments were not intended for him or that the consignments did not reach the petitioner - Petition allowed.
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2023 (6) TMI 842
Calculation of VAT - expenses charged are separate than the food charges despite only one coupon of composite amount issued at the entry by the respondent or not - penalty imposed under Section 61 of RVAT Act - HELD THAT:- The assessee cannot split up the amount charged for the sale of food, even if assessee provides certain services in addition to the food, and VAT has to be paid on the entire consideration charged for the food. The assessee, undisputedly, issued coupons that were adjustable against food only and therefore the assessee is liable to pay VAT on the entire consideration charged from its customers for supply of food.
This position of law is well settled now and explained in great detail by the Hon’ble Apex Court in the case of K. Damodarasamy Naidu and Bros. [1999 (10) TMI 598 - SUPREME COURT], holding that the price that the customer pays for the supply of food in a restaurant cannot be split up as suggested by learned Counsel.
The contention of the assessee that as per aspect theory, the dominant supply was of supply of entertainment/service is also untenable - the questions of law framed hereinabove have to be answered in favour of the revenue and against the assessee - Accordingly, the impugned order of the Tax Board is quashed and set aside and the levy of penalty is maintained.
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