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VAT and Sales Tax - Case Laws
Showing 21 to 40 of 65 Records
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2018 (1) TMI 1194 - MADRAS HIGH COURT
Concessional Rate of Tax - purchase of machinery spares, Generator spares, Hand lift - The assessing officer rejected the concessional rate of tax by holding that, as per provisions of section 3(5) and entries 3(i) to 3(ix) of English Schedule to the Tamil Nadu General Sales Tax Act, 1959, the assessee was not eligible to purchase machinery spares separately for repairs, reconditioning or replacement - AO observed that, assessee had purchased chemicals, dyes and finishing chemicals and used for converting wet blue to finished leather and since both wet blue and finished leather are one and the same commodity - As per the AO no manufacturing takes place.
Held that: - Following the decision in the case of The State of Tamilnadu, rep. by the Joint Commissioner (CT) Versus Habib Leather Manufacturing Co. [2017 (12) TMI 621 - MADRAS HIGH COURT], tax revision dismissed - decided against revenue.
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2018 (1) TMI 1160 - GUJARAT HIGH COURT
Grant of anticipatory bail - offence punishable u/s 85(2)(C) of the GVAT Act, 2003 - Held that: - the applicant has already presented himself before the Investigating Agency on 17.01.2018 and is ready and willing to do so on any subsequent date and any future dates, as directed by the said Agency. The applicant is ready to cooperate with the Investigating Agency and provide further documents, if available with him - as the applicant is already cooperating with the Investigating Agency, this Court considers it appropriate to grant the prayers made in the application - Bail application allowed.
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2018 (1) TMI 1049 - MADRAS HIGH COURT
Rejection of gross profit claimed by the revision petitioner - Whether the adoption of 10% notional Gross Profit on the purchases effected, while arriving deemed sale turnover by the Assessing Officer is correct or not?
Held that: - It is the duty of the respondent dealer to furnish the value of materials used in the execution works contract with appropriate inclusion of gross profit relatable to those materials. In practice it is not humanly possible to cull out each and every item transferred along with related Gross Profit. Thus the liability on the part of the dealer have to be arrived notionally be calculating deemed sales taxable turnover. Hence, it has been a practice of the dealers to adopt 10% Gross Profit on the purchase value of the items used in the purchase value of the items used in the works contract and thereby arrived a deemed sales turnover for which tax at the respective rate is being paid to the Department. This conventional method of adopting 10% Gross Profit and working out the liability in respect of works contractors have also been accepted by the Department. This has been in in vogue ever since the introduction of Section 3B of the TNGST Act 1959 and continued to be in course even for the liabilities pertaining to Section 5 of the TNVAT Act 2006 - it could be deduced that while doing so, the tribunal has also verified the audited Profit & Loss statement and Balance Sheet of the assessee / revision petitioner, for the relevant years.
Was the Tribunal correct in giving a judgment entirely based on perverse assertions that had no relation to either the established facts or the accounts maintained by the petitioners in the normal course of their business, audited and certified by a Chartered Accountant? - Held that: - Though, learned counsel for the revision petitioner urged that the certificate issued by the Chartered Accountant, for the period between 01.01.2007 and 31.03.2007, 01.04.2007 and 31.03.2008, 01.04.2008 and 31.03.2009 & 01.04.2009 to 31.03.2010 of the Assessment years 2006-07, 2007-08, 2008-09 and 2009-10, respectively, corroborated the accounts and balance sheet and therefore, the certificates issued by the Auditor, ought to have been given weightage, for the calculation of gross profit, which according to him, was actually earned by the assessee, and further reiterated the grounds of challenge for reversal of the orders of the tribunal
Section 142(2) of the Income Tax Act, 1961, states that for the purpose of obtaining full information in respect of the income or loss of any person, the Income Tax Officer, may make such enquiry, as he considers necessary, and as per Section 142(3) of Income Tax Act, 1961, the assessee, shall, except where the assessment is made under Section 144, be given an opportunity of being heard, in respect of any material gathered on the basis of any enquiry, under sub-section (2) and proposed to be utilised for the purpose of the assessment - the tribunal, has considered the submissions of the learned counsel, perused the relevant documents, stated supra, and passed a well considered orders in STA Nos.109 & 110 of 2015 and 200 & 201 of 2014 dated 25.06.2015, and that the same do not call for any interference.
Tax revision dismissed.
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2018 (1) TMI 998 - MADRAS HIGH COURT
Condonation of delay in filing appeal - appeal have been filed beyond the extended period of limitation provided in Section 38 of the then TNGST Act, 1959 - whether, the appellate authority is empowered to condone the delay of the extendable period? - Held that: - In Commissioner of Customs & Central Excise v. Hongo India (P) Ltd., [2009 (3) TMI 31 - SUPREME COURT], the Hon'ble Apex Court considered a question, as to whether, High Court has power to condone the delay, in presentation of a reference application, under unamended Section 35H(1) of the Central Excise Act, 1944, beyond the prescribed period, by applying Section 5 of the Limitation Act, 1963. After considering the decisions in Singh Enterprises v. CCE, Jamshedpur [2007 (12) TMI 11 - SUPREME COURT OF INDIA], it was held that time limit prescribed u/s 35H(1) is absolute and unextendable u/s 5 Limitation Act. Since court has to respect the legislative intent, limitation cannot be extended u/s 5 of Limitation Act.
In Chhattisgarh State Electricity Board's case [2010 (4) TMI 1031 - SUPREME COURT], the Hon'ble Apex Court held that Section 5 of the Limitation Act cannot be invoked by the Court to allow an appeal to be filed, under Section 125 of the Electricity Act, 1963, after more than 120 days.
Delay cannot be condoned - appeal dismissed.
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2018 (1) TMI 911 - ALLAHABAD HIGH COURT
Taxability - mobile charger - whether a mobile charger when sold as part of a composite package comprising the said article as well as a mobile phone is liable to be taxed separately treating it to be an unclassified item under the provisions of the U.P. VAT Act 2008?
Held that: - Admittedly, the mobile phone and charger are sold as part of a composite package. The primary intent of the contract appears to be the sale of the mobile phone and the supply of the charger at best collateral or connected to the sale of the mobile phone. The predominant and paramount intent of the transaction must be recognized to be the sale of the mobile phone. In the case of transactions of the commodity in question, the Court must also bear in mind that a charger can possibly be purchased separately also. However in case it is placed in a single retail package along with the mobile phone, the primary intent is the purchase of the mobile phone. The supply of the charger is clearly only incidental. In any view of the matter, there does not appear to be any separate or distinct intent to sell the charger.
The Court is considering the case of a composite package, which bears a singular MRP. The charger is admittedly neither classified nor priced separately on the package. It is also not invoiced separately. The MRP is of the composite package. The respondents therefore cannot be permitted to split the value of the commodities contained therein and tax them separately. This especially when one bears in mind that entry 28 itself correlates the article to the MRP.
Revision allowed - decided in favor of assessee.
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2018 (1) TMI 910 - DELHI HIGH COURT
Time limitation - primary defence of the Defendant was that the sales tax forms pertained to the year 1991-92 but the suit for recovery was filed only in the year 2001. Hence, the Defendant claimed that the suit was barred by limitation - Held that: - The Trial court specifically notes that the non-giving of the ST-1 forms, which is an admitted position, was a statutory obligation of the Defendant which was discharged by the Plaintiff only in the year 2001. Hence, the suit was well within limitation.
Demand of deposit from Sales Tax authorities - It is the case of the Plaintiff that though the payments for purchases were made, the ST-1 forms were not submitted despite repeated requests - Held that: - A perusal of the records reveals that the pleadings and the evidence has been properly appreciated by the learned Trial court. The admissions by the witness of the Defendant, both in the pleadings and in the cross-examination, clearly point to the fact that there was default by the Defendant in depositing the sales tax on the purchases made by him and on handing over of the ST-1 forms. The statutory obligation of the Defendant having been discharged by the Plaintiff, the Plaintiff is entitled to recover the said amount from the Defendant. There is no illegality in the impugned order.
The suit has been rightly decreed in the favor of the Plaintiff.
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2018 (1) TMI 909 - MADRAS HIGH COURT
Deemed assessment - It is the case of the Plaintiff that though the payments for purchases were made, the ST-1 forms were not submitted despite repeated requests - The respondent completed the assessment, by rejecting the objections of the petitioner. Hence, the petitioner is before this Court - maintainability of petition.
Held that: - Admittedly, the petitioner has an efficacious alternate remedy, by way of filing Appeal before the Appellate Authority, and it appears that, a portion of the tax has already been remitted by the petitioner for the respective assessment years. Therefore, the petitioner can very avail alternate remedy provided under the TNVAT Act, which is not only an effective remedy, but also efficacious remedy.
Writ Petitions are disposed of, by giving liberty to the petitioner to file Appeals before the Appellate Authority, and if the Appeals are filed within a period of 30 days from the date of receipt of copy of this order, the Appellate Authority shall entertain the same, without rejecting it on the ground of limitation.
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2018 (1) TMI 908 - UTTARAKHAND HIGH COURT
Recovery of dues of the Company from the Directors - The case of the petitioners, in a nutshell, is that the directors of the company are not liable and the amount can be recovered only from the assets of the company - Held that: - In the present case, respondent no.2 has not placed on record any material that the petitioners have played any fraud or misrepresentation - The notices, in the present case, have been issued mechanically. Petitioners cannot be held automatically responsible for outstanding dues unless the responsibility of the director was fixed after lifting the veil. Further, the company is not under liquidation.
A distinct juristic personality and the properties of a Director cannot be attached for the recovery of the dues of the Company.
Petition allowed - decided in favor of petitioner.
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2018 (1) TMI 907 - MADRAS HIGH COURT
Validity of assessment order - Section 3(4)(b) of the TNVAT Act, 2006 - the petitioner contended that they did not have adequate opportunity to produce the documents namely purchase bills and prayed for one more opportunity to place all the materials before the Assessing Officer - principles of Natural Justice - Held that: - Had the respondent afforded an opportunity of personal hearing to the petitioner, they would have been in a position to explain the factual situation and would have placed legal submissions, which they had raised in their objections - This is the reason why the Hon'ble Division Bench pointed out that even though the Act does not specifically provide for an opportunity of personal hearing, there is no bar for Assessing Officers to call upon the assessees to appear before them, produce documents and explain their case.
The matter is remitted back to the respondent for a fresh consideration - petition allowed by way of remand.
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2018 (1) TMI 868 - ORISSA HIGH COURT
Suo motu proceedings for revision - time limitation - interpretation of statute - Section 23(4)(a) of O.S.T.Act read with Rule 80 of the O.S.T.Rules - whether under Rule 80 of the Rules, revisional proceedings are to be concluded from the date of passing of the final orders passed within a period of three years sought to be revised or the proceedings if initiated within three years can be concluded beyond the period of three years?
Held that: - The purpose of Rule 80 is to give finality to the suo motu proceedings initiated by the Asst. Commissioner within a specified period and the same can be done after proper interpretation is given that the proceedings are to conclude and revision orders passed within a period specified in the Rule - the entire Rule 80 cannot be read in a disjoined manner. On reading of the Rule in a joint manner would make it clear that for revising an order within a period of three years after providing opportunity to the assessee and calling for the records, the revision order itself has to be passed within a period of three years.
Passing of the order dated 05.09.1996 in Annexure-3 which was beyond the period of three years from the date of the order sought to be revised, is liable to be quashed as also the order of the Commissioner dated 05.06.1999 in Annexure-4 - petition allowed - decided in favor of petitioner.
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2018 (1) TMI 867 - BOMBAY HIGH COURT
Principles of Natural Justice - petitioner has stated in the petition that an application for rectification of the mistake which is apparent according to her on the face of the record was not entertained. The rectification application is dated 14th July 2017 - The grievance is that the Appellate Authority as well in a short, cryptic and virtually unreasoned order dismissed the petitioner's appeal.
Held that: - Since the rectification applications are on file of the Assessing Officer and the petitioner desires to first press the same, we direct that the Assessing Officer shall consider the rectification application in accordance with law - In the event the rectification application is allowed then nothing would survive in the appeal which is filed before the Appellate Authority and depending upon the modifications or changes effected in the assessment order, the petitioner would have to decide whether to further challenge it.
No opinion expressed on the merits of the controversy.
Petition disposed off.
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2018 (1) TMI 866 - MADRAS HIGH COURT
Validity of assessment order - TNGST Act - penalty u/s 16(2) of the Act - grievance of the appellant / writ petitioner is that despite the fact of seizing of C.P.U. by the Central Excise Department and without giving any personal hearing or opportunity, the assessment order, dated 16.03.2009, was made by the respondent - Held that: - The assessment order was issued on 27.02.2004. The pre-revision notice was issued on 28.02.2006 for which the petitioner has submitted his response on 20.04.2006 and thereafter, submitted one more representation on 06.03.2009 praying for time to file objection for the reason that the records is in C.P.U., which was seized by the Central Excise Department. However, it was rejected and the impugned order came to be passed on 16.03.2009. In the considered opinion of this Court, in the light of the said fact, Section 16(1)(a) of the TNGST Act would not come to the aid of the appellant / writ petitioner.
Before passing the revision order, the dealer should be given reasonable opportunity and personal hearing, if required so, as per Section 22(4) of the TNVAT Act, 2006. No order of revision should be made without affording an opportunity to the dealer as provided under Sections 22, 25, 27 of the Act.
The impugned order, dated 02.06.2016, passed in W.P.(MD).No.2931 of 2009 as well as the impugned order, dated 16.03.2009, passed by the respondent are set aside subject to the condition that the appellant / writ petitioner shall deposit 15% of tax admitted by the appellant / writ petitioner to the credit of the respondent - Petition allowed in part.
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2018 (1) TMI 865 - MADRAS HIGH COURT
Validity of assessment order - principles of Natural Justice - works contract - case of petitioner is that the third respondent did not afford an opportunity of personal hearing, though the revision of assessment has been done under Section 27 of the said Act - Held that: - Courts have held that an opportunity of personal hearing is mandatory when revision of assessment is sought to be done under Section 27 of the said Act - In the instant case, apart from levy of tax, there is also an order levying penalty under Section 27(3) of the said Act. Therefore, it is more necessary that an opportunity of personal hearing should be granted and that the opportunity should be an effective opportunity and not an empty formality.
The matter is remanded to the third respondent for a fresh consideration - petition allowed by way of remand.
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2018 (1) TMI 818 - DELHI HIGH COURT
Jurisdiction - power of of delegation of Special Commissioner to appoint officers - Form DVAT-50 - principles of sub-delegation - consequences for wrongful doings on the part of delegated officers
Held that: - Section 68 of the Act deals with the power of the Commissioner to delegate any of his powers under the Act to any Value Added Tax Authorities. Sub-section (2) is relevant, for it relates to delegation of power under Chapter-X, and states that the delegate shall carry and produce on demand evidence in the prescribed proforma while exercising the power. Sub-section (3) states that where the Commissioner has delegated power to a Value Added Tax authority, he may supervise, review and rectify any decision made or action taken by that authority. Object and purpose behind this provision has been elucidated and explained below.
The power of delegation given under Section 68 is of importance, for the enactment i.e. the Act invariably uses the expression “the Commissioner” and does not define and prescribe functions and powers inter-se the Value Added Tax authorities. This is left to the Commissioner, who in exercise of power under Section 68 can delegate and prescribe functions, powers and jurisdiction to the Value Added Tax authorities. This power is exercised by means of notification(s) issued by the Commissioner - This authority of delegation of power and functions is vested with the Commissioner subject to restrictions and conditions as may be prescribed. These restrictions and conditions can be prescribed by Rules. Chapter-X, as noted above, deals with audit, investigation and enforcement and the chapter conferring powers requires that the delegate shall carry and produce on demand evidence in the prescribed form while exercising powers delegated to him by the Commissioner.
The Commissioner has, by notification / order of empowerment dated 23rd March, 2016, conferred the said power upon Special Commissioner. Thus the Special Commissioners are authorized to issue an authorization in DVAT -50. The authorization in Form DVAT-50 would authorize the person named with their rank to conduct survey/investigation or search. Authorized officers should not be below the rank of Value Added Tax Officer for operations under Section 60(1) and (2) of the Act. There is a difference between issue of authorization and officers who are authorized to conduct survey/ investigation or search. The contention of the petitioner, if accepted, would warrant accepting the position that the Special Commissioner must himself undertake the search and seizure. The power to authorize survey/ investigation or search is different and distinct from the power exercised by the officers so authorized and who actually undertake the search and survey. - Decided against the assessee.
Lapses and failures on the part of authorities - Held that:- in the present case only inspection of records, i.e. books of accounts, etc. and the goods was undertaken under Section 59 and sub-section (1) to Section 60 of the Act. As per the respondents, this is not a case in which search and seizure operations were undertaken under sub-section (2) to Section 60. Having held so, we would observe that certain lapses and failures on the part of authorities are apparent. - If the contention and the pleas of the petitioner are rejected, they can be burdened with tax, interest and penalty. However, there is no provision in the Act under which the authorities can be burdened with any penalty or costs for the wrongs committed by them in violation of the provisions of the Act. - we are inclined to impose penalty in form of costs of ₹ 50,000/- on the respondents. - petition disposed off.
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2018 (1) TMI 817 - MADRAS HIGH COURT
Recovery of Arrear Sales Tax - it is submitted by petitioner that if at all, the respondent has to recover any arrears of sales tax, then, the respondent should proceed against the dealer, or, in other words, the Proprietor, who owns the said Concern, as subsequently he released his part of shares - Held that: - even if the petitioner had not obtained a decree from the Civil Court, the respondent could not proceed against the petitioner's father for the alleged sales tax due payable by the petitioner. In any event, the respondent cannot proceed against the petitioner, since the petitioner had succeeded before the Civil Court and obtained decree, which is ruled in favour of the petitioner, and held that the petitioner is not a Partner of M/s.S.S.Metals on and from 01.04.1990.
The respondent has issued the impugned notice, which is bereft of particulars, and there seems to be a change of Officer, who was unaware of what has happened earlier and issued the impugned notice - impugned notice is held to be unenforceable against the petitioner - petition allowed.
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2018 (1) TMI 759 - PUNJAB AND HARYANA HIGH COURT
Direction to the respondent-authorities to take strict disciplinary/departmental action resulting into awarding major punishing against respondent No.6-Rajesh Verma, Excise and Taxation Officer-cum- Designated Officer, Jalandhar-I - it was alleged that Respondent No.6 acting with malafide intention and to cause wrongful loss to the petitioner started harassing him on the pretext that the tax leviable on the silicon is 13.75% and not as 5.5%.
Held that: - learned State Counsel was directed to produce the inquiry report as well as other relevant record for perusal of the court. In compliance thereto, enquiry report dated 13.8.2017 and other relevant record was produced. A perusal of the said report shows that all the charges have been proved against respondent No.6 - the writ petition is disposed of as infructuous as after the charges have been proved against respondent No.6, further disciplinary action is being taken against him in accordance with the relevant rules.
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2018 (1) TMI 754 - SUPREME COURT
Deferment/remission of sales tax payable - “Agro-Processing (Food Processing) Units” - West Bengal Incentive Scheme, 1999 - Held that: - In the absence of any plea of promissory estoppel we cannot understand the appellant to have been vested with any right to claim deferment or remission of the tax payable by it - As the appellant did not have a right capable of enforcement in law, there is no infirmity with the rejection of the writ petition filed by the appellant before the High Curt so as to warrant any order in favor of the appellant in this appeal.
Penalty - Held that: - imposition of penalty should be interdicted by this Court as non-payment of the tax by the appellant was on account of what we perceive to be a bonafide doubt with regard to its liability to pay tax.
Appeal dismissed.
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2018 (1) TMI 744 - MADRAS HIGH COURT
Notional deduction from sales price - sale of footwear - Whether on the facts and in the circumstances of the case the Tribunal was right in law in holding that it is not necessary to show the sale price separately in the invoice and that is sufficient if it is shown separately in the books of accounts?
Held that: - the sales tax had been collected as such on the said transaction and it has to be allowed as a deduction in computing the taxable turnover - the Court held that the legal position, therefore, seems to be clear that for claiming deduction in terms of section 7(1)(b) and 7(2)(a)(ii) of the Act, all that is necessary is that there must be evidence, not necessarily only the sale memos, to indicate that apart from the sale value of the goods sold, an amount had been collected by way of sales tax as such. If such evidence is available with the dealer, and it is found by the department to be a piece of acceptable evidence, the claim must be allowed.
Appeal dismissed - decided against Revenue.
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2018 (1) TMI 742 - MADRAS HIGH COURT
Tax evasion - Puducherry General Sales Tax Act, 1967 r/w Puducherry Value Added Tax Ac, 2007 - petitioner is praying to discharge him from the charges on the ground that he got retired from the partnership firm as early as on 01.10.1999 due to some personal reasons - Held that: - Admittedly, the petitioner/A2 was a partner of the firm. During the financial year 2000-2001, 2001-2002, 2002-2003 and 2003-2004 A1 firm is stated to have reported incorrect sales turnover and there were huge variance noticed between the purchase value of petroleum products and sales turn over and therefore, the authority initiated proceedings under law - the department has accepted the receipt of Form-10 filed by A1 firm intimating that on account of the fact that two existing partners have retired from 31.03.2003, the constitution has been changed from partnership to proprietory concern w.e.f. 01.04.2003, the petitioner, who was the erstwhile partner, cannot be mulcted with any liability.
Even if it is assumed that the petitioner retired from the partnership firm from on 01.10.1999, there is absolutely nothing on record to show that it was duly intimated to the department forthwith as required under law - the tax evasions relate prior to the said communication.
Criminal revision fails and is dismissed.
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2018 (1) TMI 614 - GUJARAT HIGH COURT
Levy of service tax or VAT - workover service contracts entered into by the petitioners with clients - GVAT Act - Article 286 of the Constitution of India read with section 5(2) of the Central Sales Tax Act, 1956 - While the petitioners duly filed returns under the GVAT Act, they did not admit any liability of tax under the GVAT Act since according to the petitioners the contracts do not involve any sale/deemed sale of goods.
Whether the contract entered into between the petitioners and the ONGC for workover operations on oil wells of the ONGC is (a) a purely service contract, or (b) a composite contract involving both, an element of service as well as transfer of right to use goods?
Held that: - while the overall supervision of the project is carried out by the representative of the ONGC, the actual work is executed by the contractor through his representative and all the contractor’s personnel are under his charge - the court has held that all the sub-clauses of Article 366(29-A) of the Constitution serve to bring transactions where one or more of the essential ingredients of a sale as defined in the State of Goods Act, 1930 are absent, within the ambit of purchase and sales for the purposes of levy of sales tax. The amendment especially allows specific composite contracts viz., works contract [sub-clause (b)]; hire-purchase contracts [subclause (c)], catering contracts [sub-clause (e)] by legal fiction to be divisible contracts where the sale element could be isolated and be subjected to sales tax. The court has observed that of all the different kinds of composite transactions, the drafters of the Forty-sixth Amendment chose three specific situations, a works contract, a hire-purchase contract and a catering contract to bring them within the fiction of a deemed sale. Of these three, the first and third involve a kind of service and sale at the same time. Apart from these two cases where splitting of the service and supply has been constitutionally permitted in sub-clauses (b) and (f) of clause (29-A) of Article 366, there is no other service which has been permitted to be so split.
The contract between the petitioners and the ONGC does not involve any transfer of the right to use goods and resultantly there is no deemed sale attracting the levy of value added tax on such transaction. The contention of the petitioner that the transaction is only for providing the service of workover operation and nothing more, therefore, deserves to be accepted.
The contract entered into between the petitioner and the ONGC for workover operations of oil wells of ONGC is a pure contract of services to the ONGC. The impugned order passed by the Tribunal which holds that the contract dated 8.7.2008 entered into between the petitioner and the ONGC is a composite contract involving both the element of deemed sale by way of transfer of right to use goods and the element of providing services to the ONGC, being contrary to the intention of the parties as provided in the agreement to contract, cannot be sustained.
The Tribunal after holding the contract to be a composite one, involving an element of service as well as an element of transfer of the right to use the goods has remanded the matter to the first appellate authority to recalculate the tax liability with consequential effect on interest and penalty - petition allowed.
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