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VAT / Sales Tax - Case Laws
Showing 81 to 100 of 545 Records
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2023 (10) TMI 721
Recovery of refund claim - arrears of the petitioner's sister concern, Tvl.Eagle Earth Movers - attachment of bank account - HELD THAT:- In the present case, for the liabilities of Tvl.Eagle Earth Movers, bank account of the petitioner was attached and thereafter, the impugned liability of petitioner's sister concern was also realised. This Court already set aside the impugned order of assessment passed against the petitioner's sister concern, quantifying the liability of Rs. 81,53,038/- in respect of the assessment years 2012-13, 2013-14 and 2014-15. Now doubt, after the business succession agreement, the petitioner's sister concern continued with the TIN No. till 2015, however, it has not carried any business after the business succession agreement for three assessment years. In this regard, the petitioner's sister concern also filed Nil returns, based on which, assessment was set aside.
In view of the order passed by this Court in setting aside the assessment made against the petitioner's sister concern, and the amount realized out of the attachment of the petitioner's bank account, Axis Bank, to an extent of Rs. 81,53,038/-, is liable to be refunded. Therefore, this Court is inclined to pass orders, directing the respondent to refund the amount, as prayed for by the petitioner.
This Court is inclined to grant the relief sought for by the petitioner, since what the petitioner seeks for is only for refund of the amount appropriated by the respondent-Department from the bank account of the petitioner, in respect of the alleged arrears of the petitioner's sister concern - this Writ Petition is disposed of by directing the first respondent to refund the sum of Rs. 81,53,038/- to the petitioner’s bank account within a period of six weeks from the date of receipt of a copy of this order.
Petition disposed off.
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2023 (10) TMI 720
Proper jurisdiction to decide the matter - Authority for Clarification of an Advance Ruling - non-application of mind - Violation of principles of natural justice - opportunity of personal hearing not provided before passing the impugned order.
It is the case of the petitioner that there is a procedural infraction inasmuch as the petitioner submitted additional submission on 09.06.2023 and which was also received by the respondent on 12.06.2023.
HELD THAT:- The petitioner has invited adverse orders from the aforesaid authority namely the Authority for Clarification and Advance Ruling earlier on 02.09.2015 and thereafter on 26.04.2019. Though the latter order of this Court in M/S. RENATUS PROCON PRIVATE LTD. VERSUS THE AUTHORITY FOR CLARIFICATION AND ADVANCE RULING, EZHILAGAM, CHEPAUK, CHENNAI, THE ASSISTANT COMMISSIONER (ST) [2022 (9) TMI 998 - MADRAS HIGH COURT] has been diluted by the previous order of this Court dated 29.09.2015 based on the submission of the learned counsel for the petitioner and though the above decision was given in favour of the petitioner, the fact remains that the Assessing Officer has applied mind while passing an order determining the classification which was earlier confirmed by the Authority for Clarification and Advance Ruling by order dated 02.09.2015 and thereafter, once again, after the order of the Authority for Clarification and Advance Ruling dated 26.04.2019 was set aside by this Court vide its Order in M/S. RENATUS PROCON PRIVATE LTD. VERSUS THE AUTHORITY FOR CLARIFICATION AND ADVANCE RULING, EZHILAGAM, CHEPAUK, CHENNAI, THE ASSISTANT COMMISSIONER (ST) [2022 (9) TMI 998 - MADRAS HIGH COURT].
The issues relating to classification are best left to be decided by the authorities under the hierarchy appellate body of the TNVAT Act, 2006 and in case, the petitioner is so aggrieved, the petitioner has to approach only the Appellate Commissioner and thereafter the Tribunal which is the ultimate fact finding authority.
Petition dismissed.
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2023 (10) TMI 671
Estimation of taxable turnover - restaurant - unaccounted sale only for one day previous to the date of search - Whether on the facts and circumstances of the case the Commercial Tax Tribunal were legally justified in estimating the taxable turnover at Rs. 35.51 lakh especially when in the previous and in subsequent assessment year accepted sales of the applicant of Rs. 2098,250/- and Rs. 21,42,450/-?
HELD THAT:- On perusal of the record, it reveals that the revisionist has disclosed turnover at Rs. 20,05,100/- and admitted the tax liability of Rs. 2,83,917/-. The books of account were rejected on various grounds and the Assessing Authority has fixed the same at Rs. 65,05,100/-, against which a first appeal was filed, which was rejected. Still feeling aggrieved, the revisionist preferred second appeal, which was partly allowed fixing taxable turnover to Rs. 4,51,648/-.
The only basis of enhanced taxable turnover was the survey dated 25.02.2016, where some bills were found pertaining to the last night, i.e., 24.02.2016. It is categorically argued before the Tribunal that the previous day of survey being a festival day, therefore, the said sale found at the time of survey, which cannot be the only determining factor as held by this Court in the case of M/s Bhagwati. It is also noticed that in the business of restaurant, there is always fluctuation in sale and therefore, the same cannot be on a higher side throughout the year as fixed by the authorities below.
The revision is partly allowed.
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2023 (10) TMI 670
Revision of assessment order - Time Limitation - demand raised on the ground that the appellant is a lumpsum contractor and validity of Section 9 read with Rule 49 of HVAT Act/Rules - assessee was liable to lumpsum payment of tax? - HELD THAT:- The delay of less than three months in passing of the revisional order has been explained satisfactorily. In this backdrop, the Tribunal has rightly held that the case fell in the exceptions of extending the period of limitation by invoking the provision of Section 34 of the HVAT Act. Hence, finding with regard to the extension of limitation has been rightly given by the Tribunal keeping in view that the assessee had sought a number of adjournments before the Revisional Authority.
The second ground for challenge to the order passed by the Tribunal is that the assessee was not liable to lumpsum payment of tax. Even this argument is liable to be rejected as Section 9 read with Rule 49 of the HVAT Act already had a provision for payment option by a contractor/developer to pay lumpsum tax - Hence, the appellant was liable to pay lump sum tax upto 16.05.2010.
Thus, no ground is made out to interfere in the findings recorded by the Tribunal while passing the impugned order. No substantial question of law arises for consideration - appeal dismissed.
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2023 (10) TMI 669
Payment of tax at compounded rates under Section 8 of the Kerala Value Added Tax Act - Deduction of certain amounts from the gross contract value received by him from the customers and applied the rate of tax prescribed under Section 8 to the said reduced contract value - benefit of sub-contractor deduction evidenced by consolidated Forms 20H issued for multiple years - HELD THAT:- Athough the provision for payment of tax on compounded basis for works contractors provides that the contractor has an option of paying tax at 3% of the whole contract amount instead of paying tax in accordance with the provisions of Section 6 of the KVAT Act, the expression “whole contract amount” for the purposes of the Section is clarified as not including the amount paid to sub-contractors for execution of a portion of works contract if the sub-contractor is a registered dealer liable to pay tax under sub section (1) or sub section (1A) of Section 6, and the contractor claiming deduction in respect of such amount furnishes certificates in such form as may be prescribed.
The provisions of a taxing statute have to be read in the backdrop of Article 265 of the Constitution of India, which clearly mandates that there shall be no levy and collection of tax except by the authority of law. Read in the backdrop of the constitutional provision, therefore, Section 8 of the KVAT Act cannot be taken as authorising the levy of tax on any amount that does not bear nexus with the construction activity involved in a works contract in the instant case. Statutory levies and amounts paid by the petitioner as pure agent of the customer, who is legally obliged to bear the burden of those levies and expenses, cannot be included in the contractual receipts of the petitioner for computing the “whole contract amount” for the purposes of Section 8 of the KVAT Act.
It is no doubt true that if there was a separate agreement for the sale of the incomplete structure, the consideration shown under such agreement would have been for the purchase of an item of immovable property and no KVAT would have been levied on the said consideration amount. In the instant case, however, there is a situation where in the single agreement that was entered into between the petitioner and his customer, the consideration for the construction activities undertaken by the petitioner for the unfinished portion of the building, at the time of entering into the agreement with the customer, includes not only the amount towards construction of the unfinished portion but also an amount towards the completed portion of the building up to the date of the agreement - Since there was only a single indivisible agreement, for which consideration flowed from the customer to the petitioner, the petitioner cannot be heard to contend that the “whole contract value” in respect of the works contract undertaken for the customer would not include the consideration attributable to the portion of the building that was already constructed at the time of entering into the agreement.
The imposition of tax on the whole contract value, the State cannot be seen as imposing tax on the sale of immovable property; on the contrary, it has to be seen as levying tax on the works contract undertaken by the petitioner, albeit on a value that stood enhanced by the cost incurred for the completed construction.
These O.T. Revisions are disposed off.
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2023 (10) TMI 668
Validity of assessment order - correctness of re-computation of the gross profit - levy of penalty on the petitioner being double the amount of tax allegedly evaded by the petitioner - HELD THAT:- While it may be a fact that an estimation of gross profit has to be done on a scientific basis, inter alia by taking into account the profit earned through the sale of the various brands of IMFL dealt with by the petitioner, in the instant case, it is found firstly, that the estimation done by the Intelligence Officer in the penalty proceedings was not challenged by the petitioner in further proceedings. The Assessing Authority has merely adopted the same gross profit as was estimated by the Intelligence Officer and it is found difficult to accept an argument against such estimation in the assessment proceedings when there was no such dispute raised by the assessee against the estimation done for the purposes of penalty. Secondly, the estimation of gross profit by the Intelligence Officer/Assessing Authority has not resulted in the adoption of an unreasonably higher rate of gross profit than what was already conceded by the petitioner towards sales of IMFL and Beer.
No doubt, in circumstances where the gross profit estimated by the revenue authorities is significantly higher than what is conceded by the assessee, and it is apparent that the estimation itself was done in an unscientific manner, it may be open to an assessee to challenge the same inter alia based on the decisions mentioned. On the facts of the instant case, however, there are no reason to interfere with the impugned order of the Tribunal.
Revision dismissed by answering the questions of law raised therein against the assessee and in favour of the revenue.
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2023 (10) TMI 586
Permission to pay tax on compounded basis - an amount of Rs.305 crores was established to represent the turnover in relation to sales effected to its sister concerns by the petitioner who had effected purchases of the goods in question as an agent of the said sister concerns - HELD THAT:- While the petitioner had shown the agency sales affected to its sister concerns as part of its turnover in its accounts, as also in the returns filed before the KVAT authorities during 2010-11, the mistaken turnover shown did not have any implication for the payment of tax on compound basis for the said year because the payment of tax under Section 8(f)(v) was only in relation to the tax paid by the petitioner for the immediately preceding year i.e. the petitioner was statutorily obliged to pay only 125% of tax paid during 2009-10, irrespective of its actual sales turnover for the year 2010-11. It is also not in dispute that the petitioner had discharged its tax liability for the year 2010-11 in accordance with the statutory provisions then in force.
The First Appellate Authority found that since the petitioner had obtained the statutorily prescribed Form 25F to claim exemption of the agency sales turnover from its declared turnover for the year in question, the same could be excluded for the purposes of computation of tax in terms of Section 8(f)(v) for the year 2011-12. The Appellate Tribunal, however, set aside the order of the First Appellate Authority on the finding that Form 25F had relevance only in a situation where the assessment to tax was in terms of Section 6 of the KVAT Act and not in situations where the payment of tax was on compounded basis under Section 8(f)(v) of the KVAT Act.
In the instant case while the turnover of the assessee was a factor for determination of tax liability in terms of Section 6 of the KVAT Act, it was not a relevant factor for determination of tax liability, in terms of the formula under Section 8(f) of the KVAT Act in 2010-11 as also till later in the assessment year 2011-12. It was only after the assessee had exercised its option to pay tax on compounded basis for 2011-12 that Section 8(f)(v) was amended to make the turnover of the previous year a part of the formula for determination of tax liability in terms of Section 8(f)(v) - when the turnover of the previous year is suddenly introduced as a new factor in the formula for determining tax liability in terms of the compounding provisions, it would be grossly unfair to deny an assessee the opportunity to demonstrate that any amount shown in his accounts/return does not represent his turnover.
Merely because the Form 25 declaration is prescribed under the KVAT Rules in connection with a determination of tax liability in terms of Section 6 read with Rule 10 of the KVAT Act and Rules it does not mean that the facts intended to be proved through it cease to exist or be relevant merely because the assessment is on a different basis, and in accordance with a formula which treats that fact as relevant and incorporates it as a component - When an assesee furnishes a declaration in Form 25 to his assessing officer, he seeks to exclude the amount covered by the Form 25 declarations from the computation of his turnover for the purposes of assessment to tax. It is not a case where the assessee initially includes an amount in his turnover and then seeks exemption/deduction of that amount for computing his taxable turnover. The amounts covered by the Form 25 declaration do not form part of his turnover at all.
The amounts covered by Form 25 declarations cannot form part of the assessee's turnover even for the purposes of Section 8(f) of the KVAT Act - Revision disposed off.
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2023 (10) TMI 521
Condonation of delay of 1651 days in filing SLP - Sufficient reasons for delay or not - HELD THAT:- It is not convincing that there is any sufficient cause to condone the delay. Hence, the special leave petition is dismissed on the ground of delay alone keeping open the question of law, if any.
SLP dismissed.
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2023 (10) TMI 520
Charge against the Commercial Tax Officer - Lapse regarding allowing Input Tax Credit - non- production of original purchase bills - careless handling of the surprise inspection and suppression of the material facts - huge revenue loss to the exchequer and improperly functioning as Inspecting Officer - HELD THAT:- In the case on hand, it is not the claim of the respondents that the team head G.Balasubramanian was discharged in view of certain illegality / inadvertence / mistake committed on the part of the Department. The Commercial Tax Officer has been discharged consciously by admitting the fact that there was a lapse on his part as well. He has been discharged, since the revenue impact has been eliminated subsequently. In such case, the same logic for granting the advantage ought to have been extended to the petitioner who is also similarly placed.
No point of time the respondents have alleged any malafide intention on the part of the petitioner. In fact, even in the order of punishment, it has been explicitly mentioned that there is no element of any ulterior motive on the part of the petitioner. So there cannot be any difficulty to grant the same benevolence shown to the then Commerial Tax Officer, who was the leader of the inspection team, to the members of the team as well.
The order passed by the first respondent is set aside - Petition allowed.
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2023 (10) TMI 519
Entitlement of rebate on the entire amount of tax paid on purchase of cotton seed at first stage and used in manufacturing of oil, oil-cake and residue - Section 15A of the Haryana General Sales Tax Act, 1973 read with rule 24A of the Haryana General Sales Tax Rules, 1975 - refund of tax paid in excess at first stage, over and above tax payable on finished goods at the stage of sale at his hands.
HELD THAT:- As per the judgment in Sharda Cotton Ginning & Pressing Factory vs. State of Haryana and others [2001 (3) TMI 991 - PUNJAB AND HARYANA HIGH COURT], once the entire cotton seeds after purchase had been used in the manufacturing and if one of the items is tax free, rebate cannot be reduced proportionately and it has to be allowed in full.
Since both the questions i.e. (1) whether on the facts and in the circumstances of the case, the dealer is entitled to rebate on the entire amount of tax paid on purchase of cotton seed at first stage and used in manufacturing of oil, oil-cake and residue in terms of the provisions of Section 15A of the Haryana General Sales Tax Act, 1973 read with rule 24A of the Haryana General Sales Tax Rules, 1975 and (2) if answer to the above question is in affirmative, whether the dealer is entitled to refund of tax paid in excess at first stage, over and above tax payable on finished goods at the stage of sale at his hands, have been answered in favour of the assessee.
General Sales Tax Reference is allowed.
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2023 (10) TMI 493
Classification of goods - tinted glass sheets - to be taxed as “goods or wares made of glass” under the Notification No.5784 dated 07.09.1981 being Entry No.IV or as unclassified item?
The plea of assessee that tinted glasses manufactured by it falls under clause (c) of sub-section (1) of Section 3A namely residuary clause and as such tax is to be levied @ 10%; whereas revenue is contending that it would fall under Entry No.4 of the notification No.5784 dated 07.09.1981 which Notification has been issued in exercise of the power conferred under clause(d) of Sub-section (1) of Section 3A of the Act.
HELD THAT:- This Court in ATUL GLASS INDUSTRIES LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [1986 (7) TMI 90 - SUPREME COURT] has held the test commonly applied to determine whether an article after subjecting to manufacturing processes becomes a different article or remains the same is: how is the product identified by the class or section of the people dealing with or using such product - In the aforesaid Judgment, the question that arose for consideration was under what tariff item ‘glass mirror’ would fall, and glass screens fitted in motor vehicles as wind screens, rear screens, window screens would fall under which competing tariff item. Adjudicating this question, this Court held that glass sheet after successive stage of processing undergoes a complete transformation to become a glass mirror and a different commercial product with a reflective surface.
There is no vagueness in the notification dated 07.09.1981 and the entry No. 4 is clear and unambiguous namely it has brought within the sweep “all goods and wares made of glass” exigible to tax but not including “plain glass panes” and the exemption being the creation of the statute itself, it has to be construed strictly and even if there is any vagueness in the exemption clause must go to the benefit of the revenue.
The impugned judgments would not call for interference and accordingly the appeals are dismissed.
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2023 (10) TMI 492
Challenge to assessment and levy of tax - application for supply of documents - variations in physical stock in comparison to the stock in record - goods transferred from the Delhi branch to the Faridabad and Ghaziabad branches on receiving orders from certain dealers - demand of Central Sales Tax computed by treating 10% of the stock transfer as inter-State sale.
HELD THAT:- There are no illegality, perversity or incorrect approach adopted by the Assessing Authority in its order dated 31 December 1999 as regards unaccounted sales as also variations in the physical stock. The findings on merits in so far as the conclusion which was drawn with regard to transactions at pages 14 and 15 of the diary that was seized at the time of search cannot be re-appreciated at this stage particularly when the learned DVATT has taken a balanced view of the matter that the Assessing Authority was not justified as regards taking into consideration the entry at page No. 35 of the diary as transaction of sale in the absence of better evidence. There is no gainsaying in pointing out that as per Section 6 of DST Act, the burden of proving that sale was not effected and that no tax was liable to be paid, was upon the appellant.
The assessing authority took a fair, just and reasonable view of the matter in proceeding to carry out a best judgment assessment thereby enhancing sales by 10% of the net GTO after deducting the stock transfer figure of GTO, and accordingly, the levy of tax with interest cannot be said to be unpalatable or an unconscionable exercise of powers.
On a conjoint reading of the provisions of Section 2(g) of CGST Act, it is clearly brought out that sale is transfer of property in goods from one person to another for cash or deferred payment or for any other valuable consideration. In other words, sale is transfer of ownership in the goods as per any contract between seller and the buyer, and it is pursuant to a contract of sale that when goods move from one State to another that Section 3 of the CST Act comes into play - no presumption in law is invited merely because the goods moved from Delhi to the depots/warehouses or storage facilities of appellant outside Delhi.
There are no hesitation in holding that the impugned order dated 02 May 2022 insofar as it pertains to second limb of demand, namely, the levy of tax under CST Act, cannot be sustained in law. However, there are no legal infirmity, perversity or incorrect approach adopted by the learned DVATT in dismissing the application under Section 73(8) read with Section 75 of the DVAT Act read with Regulation 21 of the DVAT (Appellate Tribunal) Regulation, 2005 as we find that there was no prejudice caused to the appellant and objections with regard to non supply or sharing of documents were not taken at the opportune time before the Assessing Authority.
The appeal partly dismissed thereby sustaining the demand for local tax insofar as it is levied by the impugned order under Section 3 read with Section 23 of the DST Act.
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2023 (10) TMI 491
Recovery of dues - Priority of charge of secured creditors as against the Sales Tax, Commercial Tax and Income Tax dues - Section 26E of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - HELD THAT:- The Full Bench of the Bombay High Court. In the case of Jalgaon Janta Sahakari Bank Ltd. and Anr vs Joint Commissioner of Sales and Anr [2022 (9) TMI 163 - BOMBAY HIGH COURT] held that the secured creditor would have the priority charge, as contemplated under Section 26E of the SARFAESI Act, 2002, in case the same is registered under Section 26B of the SARFAESI Act, 2002. The secured creditors, in these petitions claims that their security is registered under Section 26B of the SARFAESI Act, 2002.
In view of the Full Bench judgments, it is held that the secured creditor has priority charge over the claims of the Sales Tax, Commercial Tax and Income Tax - In case auction is held by the secured creditors and the sale certificates are not placed and/or registered, then the Registering Authority may register the same, notwithstanding the attachment of Sales Tax, Income Tax or Commercial Tax Departments.
In case the auction sale is conducted by the secured creditor and they have received excess amount than their dues, then they are liable to remit the excess amount to the Departments. However, if they have not received the amount in excess of the amount due and payable to them, then they are not required to remit any amount to the Departments and the Departments cannot sustain prosecution against the Authorised Officer or the Officer of the secured creditor for not remitting the amount.
Petition disposed off.
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2023 (10) TMI 490
Rejection of challenge to the impugned orders of assessment for the assessment years 2006-07 and 2007-08 - rejection on the premise that the appellant is bound to prefer an appeal and the filing of the rectification petition is only to circumvent the filing of a statutory appeal, which mandates pre-deposit.
HELD THAT:- It is trite law that the Court in exercise of its power of judicial review under Article 226 of the Constitution of India, would not direct a statutory authority to exercise its discretion in a particular manner, but would only command the statutory authority to perform its duty by exercising the discretion according to law.
In the instant case, the learned Judge has proceeded to examine and reject the rectification petition, which is a discretion vested with the assessing authority and has thus substituted his views as that of the assessing officer, which is impermissible in law.
In such view of the matter, the order of the learned Judge passed in the writ petitions is liable to be set aside and is thus, set aside. As a sequel, the respondent is directed to pass orders on the rectification petition filed by the appellant on 30.01.2014, on merits and in accordance with law, after affording an opportunity of personal hearing to the appellant, without being influenced by any of the observations made by the learned Judge.
Appeal disposed off.
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2023 (10) TMI 489
Legality and validity of the Notice of Assessment of Value Added Tax (VAT) - extension of period of assessment to six years by the Telangana Value Added Tax (Second Amendment) Act, 2017 - HELD THAT:- This enactment was struck down by this Court as being unconstitutional in M/S. SRI SRI ENGINEERING WORKS AND OTHERS VERSUS THE DEPUTY COMMISSIONER (CT) , BEGUMPET DIVISION, HYDERABAD, AND OTHERS. [2022 (7) TMI 420 - TELANGANA HIGH COURT] where it was held that the Second Amendment Act is unconstitutional being devoid of legislative competence. It is accordingly declared as such. Consequently, the notices issued and orders passed under Section 32 (3) of the VAT Act which have been impugned in the present batch of writ petitions are hereby set aside and quashed.
From a perusal of the impugned notice dated 21.06.2023, it is found that the said notice is clearly beyond the limitation period of four years from the end of the assessment period. Evidently, respondent No.4 has invoked the extended period of limitation of six years provided by Act 26 of 2017 though not specifically mentioned in the impugned notice. When this provision has been declared unconstitutional by this Court, we are at a loss as to why respondent No.4 had issued the impugned notice based on such a provision.
Writ Petition is accordingly allowed.
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2023 (10) TMI 488
Time Limitation - Point of initiation of re-assessment/revision of assessment under the provisions of Section 27 of the Tamil Nadu Value Added Tax Act, 2006 - HELD THAT:- The judgement in Bhatinda District Co-ooperative Milk Producers Union [2007 (10) TMI 300 - SUPREME COURT] was rendered in the context of the exercise of power of suo motu revision under Section 21 of the Punjab General Sales Tax Act, 1948. No time limit had been set out for exercise of suo motu revision. However, in view of the provision for completion of assessment within three years in cases falling under sub-section 11(1) or 11(3) and within 5 years in cases falling under subsection 11(6), the Bench held that revisional jurisdiction should ordinarily be exercised within three years and, in no circumstance, beyond five years.
The Allahabad High Court in Mass Awash Private Limited [2017 (7) TMI 664 - ALLAHABAD HIGH COURT]] considered the question relating to limitation for completion of proceedings under Section 201(1)/201(1A) of the Income Tax Act, 1961. No period of limitation was prescribed under Section 201 for exercise of power thereunder and the argument of the assessee was that if no period was prescribed, then such power could be exercised only within reasonable time and not thereafter. Several decisions were cited in support of that proposition. In those decisions, the Court had held that limitation of four years should be taken as reasonable for exercise of power under Section 201(1) / 201 (1A).
An assessment under the sales tax laws relates to the period commencing from the 1st of April of a particular year till 31st of March of the next year. The usage of the phrase ‘after completion of that year’ in Section 22(4) means that an assessment under that Section shall be completed only after the 31st of March of the assessment period. Any such assessment, if framed after 31.10.2017 would supersede the assessment deemed to have been made under Section 22(2) on or before 31.10.2017. This is for the reason that an assessment under Section 22(4) is one framed after enquiry in line with the principles of natural justice - Such an assessment would have to be preferred to a deemed assessment passed under Section 22(2) deeming the returns and annexures to be in order.
Under Section 27, the authority may, at any time within a period of six years from the date of assessment, determine to the best of his judgment, turnover which has escaped assessment and assess the tax payable on such turnover after making such enquiry as he may consider necessary. The reference to ‘assessment’ in section 27 includes a re-assessment, and can, in my considered view, connote either (i) a speaking, written order of assessment under Section 22(2) (ii) a deemed order of assessment under Section 22(2) (iii) a best judgement assessment under Section 22(4) or (iv) a revision under Section 27 of the Act in respect of subjects different from those dealt with in previous reassessments.
These writ petitions are disposed off.
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2023 (10) TMI 420
Levy of penalty on revisionist - no intent to evade the payment of tax - HELD THAT:- Admittedly, the goods were intercepted during transportation from State of Telangana to Ghaziabad, U.P. and at the time of interception the goods were accompanying with all required documents along with form 38. The purpose of form 38 is that the department should know that the goods are being imported from one State to another State. Some defects were pointed out by the department i.e. the name of the goods was not properly mentioned in form 38 and the allegation was made that the form was filled with magical ink which will be evaporated on high temperature and therefore the presumption has been drawn that the form can be re-used. On the said observation, the goods were seized and penalty was imposed.
This Court in Sale / Trade Tax Revision No. 5 of 2020 (Commissioner, Commercial Tax, U.p. Vs. S/S Atul Trading Company [2020 (3) TMI 820 - ALLAHABAD HIGH COURT] held that Even Form 38 was found to be duly filled up evidencing the transaction under which the goods were being imported. The assessee had duly produced his books of accounts in which the transaction in question is duly accounted for. In such circumstances, merely on assumption that Form 38 could be re-used, the Assessing Officer was not justified in imposing penalty.
In view of aforesaid identical case, the allegation that form which was filled with magical ink can be re-used, cannot be accepted by this Court - revision allowed.
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2023 (10) TMI 419
Maintainability of Revision petition - creation of additional demand - sale or works contract - Section 46(3) before the H.P. VAT Appellate Tribunal - HELD THAT:- The Tribunal that by filing the appeal, the petitioner was actually seeking reconsideration of the order dt. 29.08.2013, is patently erroneous in law. The view of the Tribunal that the petitioner is trying to reagitate the same issues which stood decided by the Tribunal in its order dt. 29.08.2013, cannot be agreed and, therefore, the appeal is not maintainable and cannot be entertained.
The order dt. 29.08.2013 passed by the Tribunal, decided only certain broad principles and did not give any findings on the actual facts and had remitted the matter back to the 2nd respondent by directing a Committee of two or three Members of TRU and Assessing Authority to be constituted to examine the case.
There is no question of the appellant seeking review and reconsideration of the order dt. 29.08.2013 by filing the appeal before the Appellate Authority challenging the order dt. 26.10.2020 passed by the 2nd respondent, as has been wrongly held by the Tribunal - the Civil Revision Petition is allowed.
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2023 (10) TMI 346
Rejection of Petitioner’s claim of deduction/exemption on Prime Location charges - works contract or not - HELD THAT:- Undisputed facts of the case are, assessee is engaged in the business of development and construction of residential apartments. Assessee has collected PLC and FRC from the buyers and discharged the service tax payable on PLC/FRC.
The estimate and actual cost of construction depends upon the material used for construction. The cost of construction shall be the same without reference to the direction of the flat, the view from a particular flat vis-à-vis the other flat situated on the same floor. The PLC/FRC are based on the choice of buyer and cannot be treated as cost of construction. For example, a flat situated on a higher floor over-looking a garden or seashore shall have better locational advantage than the flat in the same floor from where the garden or the seashore may not be visible. Nonetheless the cost of construction of both flats situated in a particular floor shall be the same.
By definition, ‘works contract’ does not include preferential location. Therefore the Revenue rejecting assessee’s request to exempt PLC/FRC from payment of KVAT is not sustainable in law.
These revision petitions are allowed.
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2023 (10) TMI 160
Imposition/levy of entertainment tax by the petitioners - admission fee in the form of ticket to allow people to visit trade fairs / Pragati Maidan - grievance of the petitioners is that respondent No. 1 was initially exempted from payment of entertainment tax for several years but a policy decision was taken on 18 November 1996 by the Competent Authority and exemption from payment of entertainment tax was withdrawn - HELD THAT:- A careful perusal of the various provisions would show that Section (6) is the charging Section whereby the government may prescribe a levy of entertainment tax on all “payments for admission to any entertainment”, while Section 15 of the Act lays down the procedure for the assessment of tax. A bare perusal of unamended Section 2(a) of the Act, which would be applicable in this case, as it stood prior to the amendment w.e.f. 01 February 2010 would show that it is an inclusive definition defining “admission to any place in which entertainment” subject to the context in which it comes for consideration that may provide otherwise. Further, a bare perusal of the Section 2(i) of the Act would show that the definition of the word “entertainment” is a restricted one to mean any exhibition, performance, amusement, game, sport, or race, further extending the meaning of “entertainment” to cinematographic exhibitions.
In the case of GEETA ENTERPRISES AND OTHERS VERSUS. STATE OF U.P. AND OTHERS [1983 (9) TMI 319 - SUPREME COURT], the Supreme Court had an occasion to interpret the word “Entertainment” as used in Section 2(3) of the United Provinces Entertainment and Betting Tax Act, 1937, which defined the word “entertainment” to include any exhibitional, performance, amusement, game or sport to which persons are admitted for payment. The issues arose in the background of the factual matrix where the assessee/petitioner permitted persons to enter the premises without any charge to view a show on the video which consisted mainly of sports, games etc. played on the screen of the video. It was canvassed that the petitioner was not charging any admission fee but the electronic machines imported from Japan having educational value for persons playing the games were meant to provide educational entertainment by showing sea warfare, battle field, space warfare, sports and many other things which were likely to provide both education and entertainment to the viewers, particularly to young children.
In the case of HOTEL RAJDOOT PVT. LTD. VERSUS UNION OF INDIA (UOI) AND ORS. [2008 (8) TMI 1022 - DELHI HIGH COURT], the question for determination was whether the petitioner was liable to pay entertainment tax on the payment received for admission to “Pussycat Discotheque” in its Hotel under the provision of U.P. Entertainment and Betting Tax Act, 1937, as extended to Union Territory of Delhi in which Section 3(1) was the charging Section. Section 2(3) of the above mentioned Act defined the word “entertainment” to include any exhibition, performance, amusement, game or sport to which persons are admitted for payment - It was held that entertainment tax was leviable on the coverage/fixed entry charges to access to the discotheque, this Court out rightly rejected the plea by the petitioner that the primary object of running the “Pussycat discotheque” was to provide a different menu and atmosphere to the customers. The Court found no merit in the plea that only couples were permitted entry so that there could be an element of privacy. It was held that the petitioner was charging entry fee and the serving of meals and alcohol undoubtedly had an element of amusement as the customers were not only enjoying music but also dancing on the floor.
There are regulated hours for the purposes of trade and commerce, where the main purpose apparently is promotion of trade and business, however there is no challenge to the fact that entry of general public is not restricted, and people of all ages and genders visit the site for a variety of gratification, entertainment or amusement on payment of additional or higher charges/fee. It is pertinent to mention here that the assessee may also be imposed with a levy of entertainment tax wherever people are allowed free of charge inside the complex by virtue of Section 14 of the Act.
The impugned order dated 30 November 2007 passed by the FC cannot be sustained in law - Petition allowed.
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