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VAT / Sales Tax - Case Laws
Showing 81 to 100 of 27753 Records
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2025 (4) TMI 424
Wrong availment of Input Tax Credit pursuant to the mismatch noticed between the Input Tax Credit availed by the petitioner and the documents that were filed during the assessment - HELD THAT:- A reading of Section 27(4) of TNVAT Act indicates that both before amendment and after amendment there is no scope for any discretion. The petitioner has availed Input Tax Credit which was sought to be denied based on the information gathered by the Commercial Tax Department from the checkpost and web portal - Although Sub-Section 4 to Section 27 of TNVAT Act leaves no scope for discretion in the matter of levy of penalty, this Court is of the view that the present case cannot be strictly fit into the penalty as the tax itself has been confirmed pursuant to information gathered from checkpost which is not conclusive of mistakes.
Since this case cannot be strictly covered within the purview of Section 27(4) of TNVAT Act although there has been determination under Section 27(2) of TNVAT Act, imposition of penalty cannot be justified. Under these circumstances, the Impugned Assessment Orders dated 07.02.2017 are partly set aside insofar as the imposition of penalty on the petitioner is concerned.
Petition allowed.
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2025 (4) TMI 359
Restraint on respondents from realizing entry tax from the petitioner - HELD THAT:- Bare perusal of the impugned assessment order, a categorical finding of fact in favour of the petitioner that on perusal of the records and the bill, shows that the petitioner has not realized any entry tax from its customers, while making the sale. Once a finding of fact in favour of the petitioner has been recorded, no entry tax can be realized from the petitioner in view of the circular dated 18.10.2006, which still holds water.
The impugned order dated 29.05.2024 passed by the Additional Commissioner, Grade - 2, (Appeals-1), State Tax, Bareilly is modified to the extent that no recovery of entry tax for the period from 01.04.2005 to 29.05.2005 shall be made from the petitioner.
Petition disposed off.
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2025 (4) TMI 311
Time limitation of filing revisional order - initiation of suo motu revision proceedings - whether the revisional order was within the time period of one year or not? - Section 63-A(3) of the Karnataka Value Added Tax Act, 2003 - HELD THAT:- This Court while deciding the writ petition, had made an observation with regard to the fact that the reason that revisional orders are awaited from the Commissioner of Commercial Tax is not a relevant ground or reason to withhold the refund, particularly when it is not shown that the Commissioner of Commercial Tax has already initiated revisional proceedings under the Act. This observation of the Court is relevant as it was only on 10.07.2014 that a notice was issued by the Joint Commissioner under Section 47 (3) read with Section 63-A of the Act. The said notice is the starting point of initiation of proceedings under sub-section (3) of Section 63-A of the Act, which finally culminated in the order dated 21.02.2015. So in that sense, the revisional proceeding culminated within one year of its initiation i.e., the date of issuance of notice on 10.07.2014.
In effect, the respondent had challenged the order dated 21.02.2015 on merits of the conclusion arrived at by the Joint Commissioner in the revisional proceedings. As the learned Single Judge has allowed the writ petition only on the ground that the order has been passed beyond one year and as such, without jurisdiction, and has set aside the order without going to the merits of the assessment order dated 21.02.2015, the impugned order of the learned Single Judge to that extent needs to be set aside. Though submissions have been made by the counsel for the parties on the merits of the assessment order by relying on judgments, as the same have not been considered by the learned Single Judge in the impugned order, it shall be appropriate that the writ petition is revived on the board of the learned Single Judge for a decision on the merits of the assessment order dated 21.02.2015 after hearing the counsel for the parties.
Conclusion - The revisional order is timely and within jurisdiction, setting aside the learned Single Judge's decision and remanding the case for consideration of the merits of the revisional order.
The impugned order passed by the learned Single Judge is set aside - Appeal allowed.
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2025 (4) TMI 241
Denial of Input Tax Credit (ITC) under the Orissa Value Added Tax Act, 2004 - deemed sale or not - HELD THAT:- There is no illumination in impugned order though, ground taken was mentioned, inter alia, in clause (iii) of the recital of the grounds in impugned order. In the circumstances, considering petitioner was entitled to raise all grounds as recorded in said order dated 21st February, 2023 made in presence of revenue, the order is set aside and the appeal restored to the authority.
Petition disposed off.
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2025 (4) TMI 174
Reopening of the assessment for the year 1996-97 under the CST Act, based on the alleged new material or change in circumstances - inter-state sales under Section 3(a) of the CST Act or consignment sales under Section 6A of the CST Act - HELD THAT:- The indisputable fact is that the show cause notice does not describe what was the new material based on which the assessment was proposed to be re-opened. Moreover, admittedly, assessment has already been carried out for the AY 1996-97 and an assessment order dated 26.11.1998 has been passed. Indisputably, during the course of assessment, cash book, ledger, purchase and sales bills were called for and checked. Indisputably, for the assessment, 'F' Forms, copy of agreement between petitioner and Bhuwalka Trade Links (P) Limited, copies of sale pattials, copies of lorry receipts have been verified. The other connected records have also been verified. After verification of records, the assessment order has been passed.
The Apex Court in Ashok Leyland Limited [2004 (1) TMI 365 - SUPREME COURT] held that once a declaration has been accepted and acted upon by the Revenue, unless and until on further enquiry made thereto, the particulars furnished were found to be incorrect or untrue, the assessment once made based on Form 'F' cannot be re-opened. The Apex Court went on to hold that if such a declaration is filed and on an enquiry made pursuant to or in furtherance of the particulars furnished are found to be correct by the Assessing Authority, the result thereof, which is evidenced by the expression “thereupon”, shall, in view of the legal fiction created, would be a transaction otherwise than as a result of an inter-State sale. Furthermore, once such a legal fiction is drawn, the same would continue to have its effect not only while making an order of assessment in terms of the State Act, but also for the purpose of invoking power of re-opening assessment contained in Section 9(2) of the Central Act as well as Section 16 of the State Act.
These are nothing but bald allegations with no evidence to speak of. When, in the original assessment, the Assessing Authority had satisfied himself as to the claim of the assessee by way of verifying the details in Form 'F', apart from the agreement as well as accounts of the Assessee, in the absence of any other material to discredit the details in Form 'F', the claim could not be rejected under Section 16 proceedings. There is not even a whisper questioning the truthfulness of the contents in Form 'F'. The assessment order is conclusive for all purposes and therefore, re-opening cannot be permitted merely on change of opinion and revenue be given a second innings.
Conclusion - The reopening of the assessment is quashed, the transactions are confirmed as consignment sales, and the High Court's jurisdiction is affirmed.
Petition allowed.
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2025 (3) TMI 1446
Levy of composition rate of tax on construction contract - covered by Part “B” of the Notification dated 30th February 2006 or not - whether the contract entered into by the Respondent herein with M/s. Sahara Hospitality Ltd was a works contract which fell within the Notification dated 30th November 2006? - HELD THAT:- The MSTT, after carefully going through and analyzing the context of the documents available before it, came to the conclusion that the works contract executed by the Respondent, was basically air conditioning work in a centralized Air Conditioned building mostly inside the building. All the wiring, cabling had to be concealed. It had to be done along with civil work, if a new building was being constructed, or if the work was being given along with other repairs and maintenance of the building. Finally, the said work had to be completed before finishing, plastering and civil work of the building. In a nutshell, the MSTT came to the conclusion that the work was basically going hand in hand with the civil work and the completion of the civil work was dependent on the completion of the air conditioning work. It is on this basis that the Tribunal came to the conclusion that the works carried out by the Respondent (the Appellant before the MSTT) had a direct nexus with the ongoing construction work of M/s. Sahara Hospitality Ltd, and therefore, the contract entered into by the Respondent with M/s. Sahara Hospitality Ltd was squarely covered under the Notification dated 30th November 2006.
The Tribunal, being the last fact finding authority, has come to the conclusion that the work carried out by the Respondent was going on hand in hand with the civil work of M/s. Sahara Hospitality Ltd and completion of civil work was dependent on the completion of the air conditioning work. Once this is the case, the order of the MSTT in so far as it relates to applying the Notification dated 30th November 2006 to the works contract executed by the Respondent with M/s. Sahara Hospitality Ltd does not give rise to any substantial question of law.
Even as far as the penalty is concerned and which was deleted by the impugned order, is correctly done so because if the principal challenge succeeds there is no question of any penalty being levied on the Respondent.
Conclusion - Works contracts ancillary to building construction, executed before completion, fall within the Notification's scope, qualifying for a reduced tax rate. Service tax is excluded from the total contract value under the MVAT Act.
Appeal dismissed.
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2025 (3) TMI 1240
Entitlement for the benefit of ITC as claimed under the provisions of U.P. Value Added Tax Act read with the corresponding provisions of Section 16 as well as Section 140(1) of the GST Act read with Rule 21(1)(y) of the Value Added Tax Rules - entitlement to the benefit of I.T.C. to the dealer when the business has been discontinued by the dealer on 30.06.2017.
Whether after introduction of new GST Act from 01.07.2017, the registered dealers were entitled for the benefit of unutilized ITC accrued under the UP VAT Act though having closing stock?
HELD THAT:- Under the VAT Act, the food-grains were exempted on its purchase, subject to certain conditions and the same were liable to be taxed on its sale. The benefit of ITC can only be availed on fulfillment of certain conditions as contemplated under section 13(1)(a) of the VAT Act. The unutilized ITC has to be debited or carried forward as per the sub-sections of section 13 of the VAT Act. Similar view has been expressed under rule 21(1) of the Rules.
Perusal of section 13(1)(a) of the VAT Act clearly demonstrates that the earned ITC can be utilized on the sale, subject to the conditions as mentioned in the table. The ITC can only be claimed on fulfillment of certain conditions as contemplated herein-above. Section 13(6) of the VAT Act and rule 21(1)(y) of the UP VAT Rules contemplate that in the event ITC is unutilized and the registered dealer discontinued its business and the closing stock is there, then the dealer has to debit the unutilized ITC. The registered dealer cannot be permitted to utilize earned ITC for the said period.
The case in hand, it is admitted between the parties that the opposite party has not sold the purchased goods and there was closing stock. Until & unless the last tax period of the assessment year during which business has been discontinued after adjustment of the tax liability by-passing the assessment order for such assessment year, if any excess amount of ITC is left, then only section 15(5) of the VAT Act will come into play and not otherwise - By plain reading of section 15 of the VAT Act, it is clear that the available ITC can only be refunded after passing of the assessment order for that assessment period in which the business was discontinued after adjustment of tax liability.
Once the opposite party – registered dealers, by operation of law, discontinued its business, it was the duty cast upon the opposite party dealer to debit their ITC as contemplated under section 13(6) of the VAT Act. The Tribunal has failed in its duty while allowing the appeal of the opposite party by overlooking the provision of section 13(6) of the VAT Act.
Conclusion - The Tribunal erred in allowing ITC benefits without adhering to the VAT Act's provisions, particularly section 13(6), and that the business was deemed discontinued by law, requiring ITC debiting.
The impugned judgements are set aside - All the revisions are allowed.
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2025 (3) TMI 1181
Taxable events or not - levy of Luxury Tax - allied activities conducted by the assessee, particularly those related to the operation of a beach resort and other tourism-related services - HELD THAT:- It is found that before the assessing officer, the assessee could not produce any evidence to substantiate the claim.
The question as to whether the allied activities of the assessee would fall outside the taxable event under the Act is purely a matter of adjudication on facts. It was not open for the assessee to have produced the evidence for the 1st time before the tribunal. Even assuming that the assessee could have produced such evidence before the tribunal, the tribunal ought to have remanded the matter back to the assessing officer for fresh consideration.
In this context, it is noted that despite the similar facts being presented before the tribunal in T.A.(L.T.) No. 29 of 2023, by order dated 22.2.2024, the very same officer who authored the judgment did not choose to accept the earlier orders which are impugned herein and remanded the matter back for consideration of the assessing officer.
Conclusion - In the light of the order passed in the above case wherein the assessing officer was given the liberty to consider the entire evidence on record, it is found that for the assessment years in question, i.e., 2012-2013 and 2013-2014, the matter should regain the attention of the assessment officer. Hence the petitioner is entitled to succeed.
The matter is remanded back to the assessing officer for fresh consideration.
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2025 (3) TMI 1180
Constitutional validity of the second proviso to Section 84 of the VAT Act - requirement of pre-deposit of 15% of the disputed tax to entertain an appeal - HELD THAT:- As the petitioner has already preferred an appeal and deposited Rs.68,14,980/- towards the disputed tax, respondent authorities being respondent nos.2 and 3 are requested to entertain the appeal filed by the petitioner and to dispose of the same within eight weeks from date of this order.
Petition disposed off.
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2025 (3) TMI 1097
Issuance of personal cheque to the extent of refund wrongly availed to the officer of LVO-540 by the then consultant - order passed by predecessor can be altered in the order passed by the Successor in a different direction or not - proceedings instituted pursuant to a notice under section 64 (1) of the KVAT issued in contravention of Rule 154 of the KVAT Rules 2005 can be sustained or not - Validity of consideration of total turnovers as per erroneous monthly returns filed in form VAT-100 in the absence of the books of account ACCT Bidar - Validity of disallowance of deduction claimed towards labour & like charges - HELD THAT:- The indulgence in the matter declined broadly agreeing with the submission of learned AGA. Firstly, the questions of law are haphazardly framed and they lack coherence both in terms of law and language. Secondly, these questions are not of law inasmuch as, to answer them, turning the pages of statute book would not come to aid. Despite taking through the Paper Book of the appeal, it is not shown which finding in the impugned order is perverse that is to say contrary to evidence borne out by record or which of the observations in the impugned order are made without evidentiary basis.
The vehement submission of the learned counsel appearing for the assessee that his client was not given a reasonable opportunity to produce relevant evidentiary material such as books of accounts is liable to be rejected inasmuch as, despite granting opportunity, the assessee failed to avail the same.
The vehement submission of learned counsel for the appellant that for the fraud committed by the Tax Consultant, the assessee should not be made to suffer is too broad a proposition to accept. Ordinarily, as rightly submitted by learned AGA, Tax Consultant is an Agent of the assessee, notwithstanding the professional elements involved in the Act. It is not that the assessee had not put his signatures to the Returns and Records filed before the Revenue, in a normative way.
The last contention of the appellant’s counsel that the respondent had approached the matter with prejudicial mind is too farfetched a submission. Why a high functionary of the State who acts quasi-judicially in deciding the tax liability of the assessee should be presumed to be prejudicial, remains unanswered. Such a contention cannot be countenanced without laying foundational basis. A perusal of the impugned order in the light of other material accompanying the appeal memo leaves no manner of doubt that the respondent has judiciously considered all contentions of the assessee as reflected in the impugned order.
Conclusion - i) The questions presented were not coherent questions of law. The appellant failed to demonstrate any perverse findings or observations in the impugned order without evidentiary basis. ii) The argument that the appellant was not given a reasonable opportunity to present evidence, noting that the appellant did not avail the opportunity provided, rejected. iii) The argument that the tax consultant's fraudulent actions should absolve the appellant of responsibility, highlighting that the consultant acted as the appellant's agent rejected. iv) There are no basis for the claim that the respondent acted with a prejudicial mind, noting the lack of foundational evidence for such a contention.
Appeal dismissed.
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2025 (3) TMI 1096
Completion of an assessment under the Kerala Value Added Tax Act has become barred by limitation under Section 25 (1) of the KVAT Act - mere fact that a notice is issued by the Revenue invoking the provisions of Section 25A of the KVAT Act would enable the Revenue to complete a re-assessment by ignoring the period of limitation under Section 25 (1) of the KVAT Act or not - Whether Section 25A of the KVAT Act fits in the Scheme of assessment under the KVAT Act? - HELD THAT:- Section 25A begins with a non-obstante clause, and it provides for nothing more than an additional ground on which the power to re-assess can be exercised by the Assessing Authority. The scope of that power can be gathered from the words used in the provision to define it. It is a power to proceed to re-assess the dealer and the power is to be exercised only if the Assessing Officer is satisfied that the objection raised by the CAG is lawful. It is in the backdrop of the above analysis of the power conferred under the Section that we must look for the meaning of the words “order passed” that appear in the proviso to the said Section. In our view, the order passed must necessarily be taken as a reference to the expression of satisfaction of the Assessing Officer, as to whether or not the objection raised by the CAG is lawful. Further, that satisfaction of the Assessing Officer must be one that is arrived at only after affording the dealer an opportunity of being heard.
The contention of the Revenue that Section 25A also provides for the procedure for re-assessment cannot be accepted, not only because the provision itself does not say so, but also because procedural due process in a taxing statute cannot be inferred but must necessarily find a place in the statute itself. Article 265 of the Constitution clearly mandates that there shall be no levy or collection of tax save by authority of law. In our view, therefore, once the Assessing Officer arrives at the satisfaction envisaged under Section 25A, he has to proceed to re-assess the dealer in the manner envisaged under the Statute, namely, by following the procedure under Section 25 (1) of the KVAT Act. In that process, he must also ensure that the substantive safeguards envisaged for an assessee, such as the requirement of exercising the power within the time permitted by the Statute, are strictly adhered to.
Conclusion - In cases where the completion of an assessment under the KVAT Act has become time barred by virtue of the limitation provisions under Section 25 (1) of the KVAT Act, the Revenue cannot proceed to re-assess an assessee on the basis of a subsequent report obtained from the CAG.
The O.T. Revisions and Writ Appeal filed by the State dismissed.
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2025 (3) TMI 1095
Exemption from payment of tax under the GST regime and the tax is leviable at the first point of sale - petitioner is the second purchaser of clinker - failure to produce cogent relevant documents before the revisional authority during the revisional proceedings to substantiate their contention so far as claiming exemption from payment of GST - non-payment of sale tax as the seller from whom the petitioner had purchased, having not paid the sale tax for the sales made to the petitioner - HELD THAT:- Though the counsel for the respondent tried to oppose the petition on the ground that the Tribunal’s finding cannot be found fault with as the petitioner had failed to avail the opportunity granted to them at the revisional stage in substantiating their contentions and the Tribunal could not have gone into veracity of the revisional authority’s order relying upon materials which were not produced before the revisional authority and, therefore, the finding given by the Tribunal cannot be found fault with and prays for rejection of the tax revision case, there are not much force in the said argument for the simple reason that the finding of the Tribunal, a portion of which has already been reproduced in the preceding paragraph, clearly reflects that the Tribunal has the power to go into the merits of the case scrutinizing the documents which have been produced before the Tribunal.
Undisputedly, in the instant case, the petitioner has, in fact, produced all relevant documentary proofs and it has also been accepted by the Tribunal as having been produced before them, yet the Tribunal rejected the appeal only on hyper technicality of the documents having not been brought before the revisional authority at the first instance. The findings given by the Tribunal and the arguments advanced by learned counsel for the department both would not be sustainable and the same deserves to be and are, accordingly, set aside.
The matter stands remitted back to the Tribunal for deciding the matter on its own merits both on the aspect of exemption of payment of GST as also so far as the payment of sale tax is concerned.
Conclusion - The Tribunal must consider the merits of a case based on all available evidence, even if not initially presented at the revisional stage, provided there are sufficient reasons for its late submission.
The tax revision case stands allowed and disposed of.
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2025 (3) TMI 1094
Unreasonable delay in completing the reassessment proceedings - manifest arbitrariness, thereby falling foul of Article 14 of the Constitution or not - HELD THAT:- It is trite law that wherever limitation has not been prescribed for taking any action or passing any orders, it has been consistently held that action ought to be taken or orders ought to be passed within a reasonable time.
It may be relevant to note that this Court had held that though the issuance of notice was within the period of limitation, however if the orders are not made within a reasonable time, mere issuance of show cause notice would not by itself provide immunity to the assessment orders being challenged as having been made beyond reasonable period thereby suffering from the vice of arbitrariness.
It is thus clear that even if the notice was issued within the prescribed period of limitation, inordinate/unreasonable delay in completing the proceedings would vitiate the same. In the present case, there is no explanation as to why it has taken more than 16 years after the issuance of the first notice on 12.11.2004 to issue the hearing notice on 08.07.2021 while proceeding to pass the impugned order on 02.09.2021 after almost 16 years from the date of deemed assessment.
This Court in the case of J.M.Baxi [2016 (6) TMI 813 - MADRAS HIGH COURT] found that failure to explain the delay of 5 years after initiation would vitiate the proceeding on the ground of unreasonable delay. In view of the same and following the above orders of this Court and in particular, the case of Kanthimathy Estate vs. The Assistant Commissioner Commercial Taxes [2019 (7) TMI 1991 - MADRAS HIGH COURT], wherein it was held that failure to complete the reassessment proceedings within a reasonable time after initiation of proceedings within the prescribed period would vitiate the reassessment, this Court is of the view that the impugned order of reassessment cannot be sustained and is liable to be set aside.
Conclusion - It is trite law that wherever limitation has not been prescribed for taking any action or passing any orders, it has been consistently held that action ought to be taken or orders ought to be passed within a reasonable time.
Petition allowed.
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2025 (3) TMI 952
Legality, validity and correctness of notification No.F-10/101/2006/CT/V/(94) dated 31-10-2006 (Annexure P-2) issued by the State of Chhattisgarh in exercise of the powers conferred by Section 15-B & 72(i)(b) of the Chhattisgarh Value Added Tax Act, 2005 read with sub-section (5) of Section 8 of the Central Sales Tax Act, 1956 (CST Act) incorporating the amended provisions of Section 8 (5) of the CST Act - HELD THAT:- It is not in dispute that pursuant to the notification dated 3-6-1993, the petitioner Company was granted exemption as the petitioner Company is said to have invested more than Rs. 1, 000 crores in Integrated Steel Plant and the benefit of exemption started from 22-9-1996, thereafter on 10-5-2002, Section 8 (5) of the CST Act was amended making fulfillment of Section 8 (4) of the CST Act (production of C-Form) mandatory for availing the benefit of exemption under Section 8 (5) and pursuant to the notification dated 10-5-2002 making production of C-Form mandatory, the State Government issued notification dated 31-10-2006 in exercise of the powers conferred by Section 15-B & 72(i)(b) of the Chhattisgarh VAT Act read with sub-section (5) of Section 8 of the CST Act incorporating the amended provisions of Section 8 (5) of the CST Act by which filing / production of C-Form has been made mandatory for availing the benefit of exemption under Section 8 (5) of the CST Act which the petitioner Company has called in question in the instant writ petitions.
However, in this regard, decision of the Bombay High Court in Prism Cement Limited [2013 (7) TMI 668 - BOMBAY HIGH COURT] was assailed before the Supreme Court by the State of Maharashtra in Prism Cement Limited's case [2025 (2) TMI 475 - SUPREME COURT] in which their Lordships have considered the issue with respect to Section 8 (5) of the CST Act clarifying the legal position and held that such restrictions are prospective in nature and would not apply retrospectively to cases where absolute exemption was permitted much prior to the amendment.
Reverting to the facts of the case in light of the aforesaid decision of the Supreme Court, it is quite vivid that the petitioner Company has been granted absolute exemption from the tax liability on fulfillment of certain conditions as per the notification dated 3-6-1993 and as per the decision of the Supreme Court, the amendment made in Section 8 (5) of the CST Act making the production of C-Form mandatory for availing benefit of tax exemption wold apply with effect from 10-5-2002 and the amended provision of Section 8 (5) with effect from 10-5-2002 would apply prospectively to the transactions in respect of which Eligibility Certificate are issued subsequently, as held by their Lordships of the Supreme Court. It is made clear that notification dated 31-10-2006 would not apply to the petitioner Company as they had already been exempted with effect from 22-9-1996, as the exemption was available up to 21-9-2019 and now, on coming into force of the GST regime up to 30-6-2017. In that view of the matter, notification dated 31-10-2006, would not apply to the petitioner Company and exemption would be available as per the notification dated 3-6-1993 up to 30-6-2017.
Conclusion - The absolute power initially conferred under Section 8 (5) upon the State Government to grant exemption/partial exemption of tax in connection with inter-State sale, trade or commerce with the amendment was circumscribed and restricted to the fulfilment of the requirement of Section 8 (4) of the CST Act which prescribes for the submission of Form 'C' and 'D' only w.e.f. 11.05.2002. However, such restrictions are prospective in nature and would not apply retrospectively to cases where absolute exemption was permitted much prior to the amendment.
Petition allowed.
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2025 (3) TMI 951
Challenge to provisional attachment order - property was not owned by the main borrower but by a third-party guarantor - challenge to conditional share certificate - HELD THAT:- From the sale deed, it will be evident from page No. 57 that the property in question is the same property which is shown as property No. 3 in the auction notice. It is also evident that the purchaser is one Sangitaben Hareshkumar Mashru. It is also a matter of record which is undisputed by the parties that the said purchaser namely Sangitaben Hareshkumar Mashru was not a partner of M/s. Rameshwar Cotton Industries. In fact, the public auction notice at Page 46A of the paper book categorically refers to “Name of Title holder” of property No. 3 to be “Sangitaben Hareshkumar Mashru” and not M/s. Rameshwar Cotton Industries, which is only shown as title holder of property No. 1. Therefore, the aforesaid property being property No. 3 in the auction notice has been wrongly attached as a property of M/s. Rameshwar Cotton Industries or any of its partners, whereas, in reality it was a self own property, a third party – guarantor.
Further it will be seen that the CERSAI Registration in respect of the charge by the Bank is dated 11.04.2008. Whereas, the date of issuance of notice under Section 135D of the Bombay Land Revenue Code, 1879 is 03.06.2015 and the date of attachment of the State Tax Authority is dated 13.08.2019. Therefore, evidently the Bank has prior charge over the property and following the law declared by this Court in Kalupur Commercial Co-operative Bank Ltd. Vs. State of Gujarat [2019 (9) TMI 1018 - GUJARAT HIGH COURT], it has to be held that the property in question, being property No. 3 in the auction notice dated 20.06.2022 does not bear any charge for the crown debts, after the same has been purchased in the auction by the Petitioner.
Conclusion - i) The actions of Respondent No. 1 in issuing a conditional sale certificate with encumbrances are unlawful under the SARFAESI Act. ii) The attachment orders by Respondent No. 2 are also found to be invalid as they were applied to a property not owned by the borrower.
The provisional attachment order as well as the final attachment order whereby the charge was created on the property being Commercial property at survey no. 316/8p, Sr. No. 294, Opp. Rajdhani Hotel, Mahuva Road, Badhada, Ta. Savarkundla, Dist. Amreli is hereby quashed and set aside - Petition allowed.
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2025 (3) TMI 896
Time Limitation of proceedings initiated u/s 27 of the Tamil Nadu Value Added Tax Act, 2006 (TNVAT Act) - HELD THAT:- For passing an order under Section 27(1)(a) of the TNVAT Act, 2006, the proceedings should have been initiated within a period of six years from the date of assessment. Since the learned Single Judge took 31.10.2013 as the starting point for limitation, it was concluded that proceedings under Section 27(1)(a) of the Act, 2006 should have been initiated prior to 29.10.2019. As the proceedings were initiated only on 22.02.2021, the learned Single Judge held that they were hit by limitation - The starting point for limitation cannot be 31.10.2013 but only 29.01.2016 as rightly contended by the assessing officer.
The assessment order impugned in the writ petition was rightly set aside. This is because, the notices preceding the assessment order are delightfully vague. Vagueness is one of the recognized grounds for judicial review. Section 27(1)(a) of the TNVAT Act, 2006 which provides for revision of assessment contemplates issuing show cause notice, giving the dealer a reasonable opportunity and making enquiry. In other words, there has to be due compliance with the principles of natural justice.
A show cause notice is like a charge. Unless it is precise, the person called upon to respond cannot defend himself. That is why, vagueness is a ground for interference by the writ court even at the notice stage. It would have been better if the writ petitioner had pointed this out earlier and demanded better particulars from the appellant. But the failure or omission on the part of the assessee cannot be taken advantage by the assessing officer. An order is like a superstructure. The show cause notice is the foundation. If the foundation is weak, the superstructure will fall at the slightest push.
Conclusion - i) The proceedings were not time-barred, as the limitation period began from the date of re-assessment. ii) The quashing of the assessment order confirmed due to the vagueness of the notice, allowing the appellant to initiate fresh proceedings with adequate notice.
Appeal allowed in part.
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2025 (3) TMI 895
Seeking clarification of notification - Retrospective application of notification dated 31-10-2006, which incorporates the amended provisions of Section 8(5) of the Central Sales Tax Act, 1956 (CST Act) - HELD THAT:- It is not in dispute that pursuant to the notification dated 07-11-1997, the petitioner Company was granted exemption as the petitioner Company is said to have invested more than Rs. 550 crores in Integrated Steel Plant and the benefit of exemption started from 07-11-1997, thereafter on 10- 5-2002, Section 8 (5) of the CST Act was amended making fulfillment of Section 8 (4) of the CST Act (production of C-Form) mandatory for availing the benefit of exemption under Section 8 (5) and pursuant to the notification dated 10-5-2002 making production of C-Form mandatory, the State Government issued notification dated 31-10-2006 in exercise of the powers conferred by Section 15-B & 72(i)(b) of the Chhattisgarh VAT Act read with sub-section (5) of Section 8 of the CST Act incorporating the amended provisions of Section 8 (5) of the CST Act by which filing / production of C-Form has been made mandatory for availing the benefit of exemption under Section 8 (5) of the CST Act which the petitioner Company has called in question in the instant writ petitions.
Decision of the Bombay High Court in Prism Cement Limited [2013 (7) TMI 668 - BOMBAY HIGH COURT] was assailed before the Supreme Court by the State of Maharashtra in Prism Cement Limited's case [2025 (2) TMI 475 - SUPREME COURT] in which their Lordships have considered the issue with respect to Section 8 (5) of the CST Act clarifying the legal position and held that such restrictions are prospective in nature and would not apply retrospectively to cases where absolute exemption was permitted much prior to the amendment.
Reverting to the facts of the case in light of the aforesaid decision of the Supreme Court, it is quite vivid that the petitioner Company has been granted absolute exemption from the tax liability on fulfillment of certain conditions as per the notification dated 07-11-1997 and as per the decision of the Supreme Court, the amendment made in Section 8 (5) of the CST Act making the production of C-Form mandatory for availing benefit of tax exemption would apply with effect from 10-5-2002 and the amended provision of Section 8 (5) with effect from 10-5-2002 would apply prospectively to the transactions in respect of which Eligibility Certificate are issued subsequently, as held by their Lordships of the Supreme Court. It is made clear that notification dated 31-10-2006 would not apply to the petitioner Company as they had already been exempted with effect from 07-11-1997, as the exemption was available up to 17-04-2013.
Conclusion - Notification dated 31-10- 2006, would not apply to the petitioner Company and exemption would be available as per the notification dated 07-11-1997 up to 17-04-2013. The petitioner Company would be entitled for the benefit of exemption without submission of C-Form.
Petition allowed.
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2025 (3) TMI 840
Challenge to assessments made under the provisions of the Tamil Nadu Value Added Tax Act, 2007 - denial of exemption claimed by the petitioner to which a detailed reply was filed by petitioner, overruling which orders of assessment have come to be passed - HELD THAT:- In the present case, the GO clearly uses the term 'exercise notebooks' and there can be no two views on the position that the notebooks manufactured by petitioners, used by students for the purposes of academic exercises, would satisfy that definition.
In Maharaja Book Depot v State of Gujarat, [1978 (10) TMI 148 - SUPREME COURT], the Supreme Court considered the interpretation of the term 'paper' in juxtaposition with the term 'exercise book' holding that an exercise book was nothing but a collection of sheets of paper stitched together by a piece of string or pinned together and a substance used for writing. It would therefore, clearly fall within ambit of the term 'paper'. It does not, the Bench holds, lose the identity of 'paper' merely because it is stitched together as a notebook.
The notebooks manufactured by the Petitioner being only notebooks (ruled and unruled) used for the purposes of student exercises, are entitled to the exemption sought. In light of discussion as aforesaid, the findings and conclusions of the assessing officer in the impugned assessment orders to the effect that notebooks manufactured by petitioners do not satisfy the requirement of 'student exercise book' is erroneous, as is the denial of exemption.
Conclusion - The notebooks manufactured by the Petitioner being only notebooks (ruled and unruled) used for the purposes of student exercises, are entitled to the exemption sought.
The impugned assessment orders are set aside and these writ petitions are allowed.
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2025 (3) TMI 737
Levy of tax under the provisions of Madhya Pradesh Commercial Tax Act, 1994, for declaration that petitioner is immune from levy of tax under the Act on supply of medicine in the course of activity of running its charitable hospital - supply of such medicine only in specified circumstances as a part of their main non business activity of running the charitable hospital can be said to be connected, incidental or ancillary to their main non business activity or not - HELD THAT:- Heavy reliance has been placed by the learned counsel for the respondents on the decision of the Apex Court in Cochin Port Trust [2015 (4) TMI 936 - SUPREME COURT] to contend that the definition of a dealer is an inclusive definition, whereby wide range of persons have been placed under the ambit of dealer. It includes persons involved in carrying on any business or trading activity and transactions are effected by them whether in the course of business or not. The definition of dealer is in consonance with legislative intent to place the persons engaged in activities of sale and trade which would not otherwise fall in the restricted definition of business. The said contention, in our opinion, is not acceptable for the reason that the definition of a dealer as given under the Kerala General Sales Tax Act 1963 is not pari materia with the definition of a dealer as given under the Act, 1994. The definition under the Kerala General Sales Tax Act, 1963 has specific clauses whereby those persons have also been included within the definition of a dealer who sell or transfer goods as specified therein "whether in the course of business or not"
The words "whether in the course of business or not" as under the Kerela Act are wholly absent in the definition of a dealer as given under the M.P. Act. The definition under the M.P. Act defines a dealer to mean any person who carries on the business of buying, selling, supplying or distributing goods, etc. The only condition for attracting the definition of a dealer to a person is that he must be carrying on the business whereas under the Kerala General Sales Tax Act, 1963 that is not a precondition for bringing him within the definition of a dealer - The said judgment relied upon by the learned counsel for the respondents is distinguishable and is not applicable to the facts of the present case.
In Bhailal Amin General Hospital [2016 (8) TMI 670 - GUJARAT HIGH COURT] the Gujarat High Court has also held that the petitioner therein being a charitable trust running and maintaining a public hospital while purchasing, selling and supplying medicines to patients in order to achieve objects was not engaged in business activity and therefore was not a dealer.
Though it has been contended by the learned counsel for the respondents that the petitioner is earning profit from sale of medicines meaning thereby that it is carrying on completely independent business and its motive is to gain profit hence it has to be treated as a dealer under the Act, but in Aswini Hospital Private Limited and others [2019 (3) TMI 438 - KERALA HIGH COURT] it has been held that actually deriving profit from the sale of goods is by itself wholly insufficient for bringing a person within the definition of a dealer. The contention in this regard is hence liable to be rejected.
Conclusion - The petitioners are exempted from levy of tax under the Act, 1994 on supply of medicine in the course of activity of running its charitable hospital. For the very same reasons as discussed above and applying the same principles, it is further held that the petitioner is exempted from levy of tax under the Act, 1994 in respect of the canteen run by it for the attendants of the patients in the course of activity of running its charitable hospital.
Petition allowed.
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2025 (3) TMI 674
Utilisation of goods purchased under Form-C for purposes other than generation of electricity, namely, transformation and transmission - penalties for alleged misuse of registration certificates and misrepresentation in purchasing goods.
Utilisation of goods purchased under Form-C for purposes other than generation of electricity, namely, transformation and transmission - HELD THAT:- In Ipitata Sponge Iron Ltd. [1990 (10) TMI 350 - ORISSA HIGH COURT] the registration certificate issued to appellant therein did not include ‘refractory’. Revenue had moved against appellant therein. In that context coordinate Bench had considered mitigation following finding on conduct of revenue as had not been free from blame. The view does not come to aid of revenue.
Cement, petitioner says, was used for purpose of constructing the plant, in which there has been generation of electricity. Inter alia, ‘plant’ was separated from ‘machinery’ as an item in the rule by GSR no.1059 dated 29th October, 1958. ‘Plant’ became an independent item. It is to be seen whether, for purpose of generation of electricity there is necessity of a plant and if so, construction of it by use of, inter alia, cement. Petitioner’s contention is, the plant was constructed after the registration certificate was obtained, on goods purchased by declaration on Form-C. There does not appear to be any dispute that petitioner did construct a plant, from where it commenced its generation of electricity - There is also no indication from materials on record that after construction of the plant, cement had been purchased by declaration in Form-C. Cement was an item subsequently added in the registration certificate. It is absurd to expect cement will be directly used for purpose of generation or distribution of electricity.
Penalties for alleged misuse of registration certificates and misrepresentation in purchasing goods - HELD THAT:- Where there is a finding of guilt to impose penalty, the authority is obliged to show that if the items purchased on declaration by ‘C-Form’, are present in the premises where petitioner is generating electricity for distribution, there is also some collateral purpose of business for which the items were or are being used. There is clear absence of finding on fact but interpretation of the provision and view taken for imposition of penalty.
Conclusion - i) The interpretation of Rule 13 should not be unduly restrictive, and materials used in constructing a plant for electricity generation can be considered within its scope. ii) Penalties under sections 8 and 10 require clear evidence of misuse or misrepresentation, which was lacking in this case.
The impugned revision order dated 16th June, 1994 cannot be sustained. It is set aside and quashed - petition allowed.
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