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VAT and Sales Tax - Case Laws
Showing 21 to 40 of 100 Records
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2018 (3) TMI 1534
Input tax credit - Odisha VAT Act, 2004 - whether the opposite party no.2, who on finding discrepancies in the VAT returns had recommended further investigation and wanted submission of detailed enquiry report/evasion report, was competent to assess the petitioner under Section 43 of “the Odisha VAT Act”?
Held that: - It is well settled that the principles of natural justice demand that nobody shall be a judge of his own cause. It is equally well settled that justice should not only be done but also should be manifestly be seen to have been done.
In the present case, the undisputed facts show that the officer at whose instance further investigation was initiated on the basis of his prima facie finding relating to huge mismatch and excess claim of inputs tax credit by the petitioner, has himself conducted the assessment resulting in issuance of impugned assessment order under Annexure-1 and consequential demand notice under Annexure-2 - the reasonable likelihood of bias cannot be ruled out.
The competent authority is directed to re-assess the assesse and complete the reassessment, preferably, within a period of eight weeks from today - Application disposed off.
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2018 (3) TMI 1533
Principles of Natural Justice - Revision of assessment - purchase of H.O.T Crane - suppression of facts - it is pleaded, the respondent being a quasi judicial authority ought to have given reasonable time before proceeding on the basis of the inspection report based on which the original notice was issued - Held that: - while the respondent had issued the pre-assessment notices on the basis of the inspection report of the enforcement wing, no prejudice would have been caused had the respondents offered an opportunity of personal hearing to the petitioner to come and explains their case before passing final orders under Section 27 of the Act. The problem had occurred in the present case only for a simple reason that the respondent failed to hear the petitioner.
Division Bench of this Court in Madras Granite (P) Limited Vs Commercial Tax Officer, Arisipalayam Circle, Salem and Another reported in 146 (1) STC 642 [2002 (10) TMI 767 - MADRAS HIGH COURT] has held that It is well-settled that the assessing officer is a quasi-judicial authority and in exercising his quasi-judicial function of completing the assessment, he is not bound by the instructions or directions of the higher authorities.
Finding that the respondents miserably failed to follow the mandatory provisions under Section 27(1) and 27(2)of the Act, the impugned assessment orders are unsustainable in law - impugned order set aside - petition allowed.
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2018 (3) TMI 1532
Whether in the facts and circumstances of the case, the Haryana Tax Tribunal was right in confirming dismissal of appeal by the first appellate authority in default when the first appellate authority itself entertained the appeal after the compliance of the order of the Tribunal by paying first instalment and filing of Bank Guarantee for the rest of the amount?
Held that: - Admittedly, the appellant has now deposited all the installments. Since there was a delay in depositing the installments, the appellant had also paid interest amounting to ₹ 10,72,500/- on 8.8.2017.
The matter is remanded to the JETC(A) to decide the appeal on merits.
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2018 (3) TMI 1474
Release of seized goods - dismissal of revision application - Held that: - this Court is of the considered view that no proceedings for rectification as envisaged and recognised in law was adopted by the Department. If applications for rectification came to be made in the manner as evidenced by the facts of this case and were to be entertained and countenanced, it would give rise to pernicious possibilities - The course adopted by the respondents cannot possibly be approved by the Court since the application itself appears to have been made without due care and circumspection as was warranted.
Revision dismissed.
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2018 (3) TMI 1473
Recovery of sugarcane purchase tax and arrears of sales tax - legality and validity of the attachment order - auction - SARFAESI Act - Held that: - Admittedly, respondent No.3 had no licence to run Sugar Factory. It is not the case of any of the respondents that it was being run by respondent No.3 for manufacturing sugar until issuance of public notice for auction sale on 16th January, 2012 and even thereafter till it was given in possession of the petitioner on 22nd November, 2012. If the petitioner makes such defunct factory functional and starts manufacturing sugar under its own licence, it cannot be said that the petitioner purchased the business interest of respondent no. 4. It is, thus, clear that the petitioner has not purchased and succeeded the business interest of respondent NO. 4.
Respondent NO. 2 cannot recover the dues payable from respondent No. 4 by enforcing any charge against the secured assets purchased by the petitioner in the auction - The issue of priority between the Sales Tax Authorities and respondent No. 3 shall be decided in appropriate proceedings before the appropriate forum in accordance with law - petition allowed.
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2018 (3) TMI 1472
Recovery of sales tax dues of the period prior to the cut of date fixed by the Board for Industrial and Financial Reconstruction - Held that: - Section 22 of the SICA clearly provides that no proceedings for distress or like against any of the properties of the company and no suit for recovery of money shall lie or be proceeded with except with the consent of the Board or the appellate authority if in respect of that company an inquiry under Section 16 is pending or any scheme referred to under Section 17 is under preparation or a sanction scheme is under implementation.
As the request of the petitioner company for waiver/deferment of tax dues in the wake of it being declared sick and the subsequent abandonment of it and the repeal of the SICA is under consideration, there appears to be no justification on part of the respondents to proceed and recover any past tax dues from the petitioner company at this stage.
Petition disposed off.
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2018 (3) TMI 1416
Whether in absence of any assessment order passed in the original proceeding under Section 21(7) of the VAT Act, the assessing officer has power and jurisdiction to reassess the said deemed reassessment by resorting to reassessment proceeding under Section 22(1) of the VAT Act and further the consequential question would be, whether in that case, the assessing officer is justified in levying penalty under Section 22(2) of the VAT Act?
Held that: - “order of assessment” employed in Section 22(1) of the VAT Act clearly denotes that there must be formal adjudication by the assessing officer after taking into account the return and statutory compliances and the documents furnished by the petitioner - In order to attract Section 22(1) of the VAT Act, there must be order of assessment made by the assessing officer in contradistinction to Section 21(2) which is a deemed assessment and which in case of the petitioner, it has been done is a legal fiction.
The legislature is quite competent to create a legal fiction, in other words, to enact a deeming provision for the purpose of assuming existence of a fact which does not really exist.
In sum and substance, in order to invoke jurisdiction under Section 22(1) of the VAT Act or to initiate proceedings for reassessment there must be an order of assessment duly passed by the assessing officer and it must be in existence as a condition precedent to invoke Section 22(1) and the limitation prescribed is five calendar years from the date of commencement of such proceedings, whereas the deemed assessment order under Section 21(2) is only reassessable under Section 21(3) of the VAT Act within one calendar year from such year. In case there is no order of assessment passed under Section 21(7) of the VAT Act, it cannot be subject to reassessment proceeding under Section 22(1) of the VAT Act.
Penalty - whether the penalty imposed invoking Section 22(2) of the VAT Act is sustainable? - Held that: - it has already been held that there is no order of assessment as the assessing officer did not pass any assessment order and thus, there is failure on the part of the assessing officer to pass the original assessment order. For the reason that the order of reassessment is to be held without jurisdiction and without authority of law, therefore, the order imposing penalty passed upon reassessment cannot stand and accordingly, it deserves to be quashed.
Order of assessment quashed - petition allowed.
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2018 (3) TMI 1415
Validity of assessment order - Held that: - Having admitted the mistake, the respondent could not have proceeded further, without making proper proposal, he proposed to proceed with the assessment on totally different lines. This mistake committed by the respondent goes to the root of the mater, affecting the very orders of assessment. This is sufficient to hold that the impugned orders are bad in law, as they have exceeded the proposal in the Revision Notices, dated 14.11.2016, and without due application of mind - Petition allowed.
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2018 (3) TMI 1414
Validity of assessment order - scope of SCN - input tax credit - Held that: - the assessment order was passed based on facts, of which the petitioner was not informed in the show-cause notice issued to them earlier - The first respondent shall issue a notice afresh in Form VAT 305-A; give the petitioner an opportunity of being heard, and an opportunity of oral hearing; and, thereafter, pass a fresh assessment order in accordance with law at the earliest - petition disposed off.
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2018 (3) TMI 1413
Rejection of appeal for non-compliance - default pointed out by the Additional Commissioner in the appeal was that the entire amount assessed was not deposited and the appeal also has been filed at a belated stage after about 5 months delay - Held that: - this Court is of the opinion that ends of justice would meet if the Petitioner is granted one more opportunity to appear before the Additional Commissioner and satisfy the Additional Commissioner in appeal which is pending before the Additional Commissioner pertaining to Annexure P-1, subject to the Petitioner being penalized by paying a cost of ₹ 10,000/- to be deposited in the office of the Commercial Tax Department - petition disposed off.
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2018 (3) TMI 1412
Concessional rate of tax - supplies effected to the Unit run canteens - It is the stand of the petitioners in the writ petition that, as per the statutory provisions, the benefit of concessional rate of tax is applicable, not only in respect of supplies effected to the Canteens Stores Department, but also in respect of supplies effected to the Unit run canteens of the Military, Navy and Air Force - Held that: - taking note of the distinction between a sale effected directly to the Canteen Stores Department and sales effected directly to Unit-run canteens of the Military, Navy, Air force etc., the State Government decided to depart from the earlier practice of granting concessional rate of tax even in respect of supplies effected to Unit-run canteens and confined the benefit of concessional rate of tax only to supplies effected to the Canteen Stores Department. The amendment, however, was to take effect only from the assessment year 2014-15, and for the prior period, it was felt not necessary to interfere with the benefit of concessional rate of tax, that was already extended to unit run canteens.
The assessing Authority has not taken note of this amendment, which came into effect only from the assessment year 2014-15, and appears to have applied the rationale of the amended provision to even the earlier assessment years up to, but not inclusive of the assessment year 2014-15 - the assessment orders impugned in all these writ petitions, inasmuch as they pertain to assessment years 2011-12, 2012-13 and 2013-14, must necessarily be quashed.
As regards 17209/2017, Ext.P3 assessment order, that is impugned in the said writ petition, pertains to the assessment year 2014-15, and the interpretation to be placed on the provisions of the 5th proviso to Section 6(1), is as indicated in this judgment. It is made clear that, in the said case, the petitioner will not be entitled to the benefit of the concessional rate of tax in respect of supplies effected to Unit-run canteens.
Petition disposed off.
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2018 (3) TMI 1369
Demand of tax refunded earlier - manufacture of refined rice bran oil - obtained de-oiled rice bran as a by-product - partial rebate under Section 17 of the KVAT Act - interest - penalty.
Held that: - it is clear that Annexure-C notice issued under section 42 of the KVAT Act is only for the purpose of information to the assessee and has no legal force and the same cannot be enforced. The same is held to be only for the purpose of information. Parallel proceedings initiated by the Deputy Commissioner if any, is not the subject matter of the present proceedings, there is no overlapping as such and hence, the argument of the petitioner on this ground also fails.
Penalty - Held that: - It is trite law that penalty is not automatic, while imposing penalty, it is mandatory to provide an opportunity of hearing to the dealer but in the batch of present cases, no such penalty is levied by the prescribed authority.
Interest - Held that: - there is a delay caused in making the payment of legitimate taxes to the department. However, levy of interest under Section 36 shall be subject to hearing in the peculiar circumstances of the case on hand. It is true that interest would have been attracted if there is any omission on the part of the dealer if no output tax paid or short paid or higher input tax claimed. The prescribed authority ought to have examined this aspect of the matter in providing an opportunity of hearing to the petitioner.
Once indemnity bond is furnished, the payment of tax refunded is mandatory and the same cannot be assailed by the petitioner. Hence, confirming the demand of tax refunded, the matters are remanded to the prescribed authority to examine the levy of interest applicable to the tax demanded.
Petition allowed in part.
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2018 (3) TMI 1368
Waiver of arrears on interest - Karnataka Tax on Entry of Goods Act, 1979 - Karasamadhana Scheme, 2017 - Respondent No.3 rejected the application on the ground that the application submitted by the petitioner was not accompanied by 10% of the arrears of tax - Held that: - It is apparent that the petitioner has deposited 30% of the arrears of interest before the Appellate Authority and the same is not disputed by the revenue - Rejection of the application of the assessee on the ground that no arrears of interest was demanded by the Authorities is untenable. Hence, the Respondent No.3-Authority ought to have considered the demand notice along with the assessment order - entitlement of the petitioner for the scheme cannot be denied on this count.
Petition allowed - decided in favor of petitioner.
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2018 (3) TMI 1367
Rate of tax - works contract - what is the rate of tax applicable to the contract/activity of the petitioner for flex, vinyl printing and installation? - Held that: - The Commissioner of Commercial Taxes ought to have examined whether the installation work carried on by the assessee is a composite contract attracting Sl. No.23 of the Sixth Schedule to the Act - The Commissioner proceeded on the ground that the contract falls under Entry 23 of the Sixth Schedule without assigning any valid reasons. In the circumstances, this Court is of the considered opinion that the Respondent No.1-Commissioner of Commercial Taxes shall examine this aspect and a decision shall be taken in accordance with law.
The Commissioner’s clarification impugned at Annexure-E to Writ Petition No.51431/2017 is quashed - matter is remanded to Respondent No.1-Commissioner of Commercial Taxes to examine the issue in the light of the observations made as aforesaid and take a decision in accordance with law in an expedite manner - petition allowed by way of remand.
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2018 (3) TMI 1366
Taxable turnover liable to tax under Section 3(5) of the Tamil Nadu General Sales Tax Act, 1959 - Held that: - the respondent took a stand that the polythene granules purchased by the appellant / writ petitioner from the dealer has been resold in its entirety and the said fact is seriously disputed by the appellant / writ petitioner - a portion of the purchases have not been used for manufacture purpose and they were resold. Thus, the petitioner has contravened the provisions under Section 3(3) of the Act. Hence, the said turnover has been assessed to tax at 1% which is in accordance with statute
The purchase turnover of ₹ 82.56,954/- cannot be included for the purpose of levying the tax at the rate of 1% p.a. and for the purpose of assessment under the provisions of the Tamil Nadu Additional Sales Tax Act - penalty also set aside - appeal allowed in part.
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2018 (3) TMI 1365
Whether the Commercial Tax Tribunal has erred in law in holding that supply of cement, steel and bricks etc. to the contractors by the Government Department, for which cost is deducted from the bills of the contractors, does not amount to sale’ and is it not liable to tax?
Held that: - it is admitted by Mrs. Beena Pandey, learned Standing Counsel for the State of U.P. that the respondent is a registered dealer - there is no reason to not apply the principle laid down by the Hon’ble Apex Court in M/s N.M. Goel and Co. [1988 (10) TMI 106 - SUPREME COURT OF INDIA], where it was held that The costs of materials so supplied and consumed in the construction work have been deducted from the final bill of the petitioner, showing that there was sale of those materials. If the department had not supplied those materials, the petitioner would have purchased the same from the market.
The Tribunal to the extent it is impugned is set aside and the order of the Assessing Officer restored - revision allowed.
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2018 (3) TMI 1327
Recovery of arrears - Auction purchaser - Section 24 of the TNGST Act, 1959 - Held that: - the issue as to whether the right of the secured creditor over the subject property mortgaged will prevail over crown debt is no longer res integra - reliance placed in the case of Union of India and others vs. SICOM Limited and another [2008 (12) TMI 53 - SUPREME COURT], where the issue before the Hon'ble Supreme Court was whether the State Financial Corporation from whom money was borrowed, by executing a mortgage to the corporation, would have priority over Central Government, which intended to realise the central excise dues, by attachment and seizure of the mortgaged properties. It was held in the case that secured debts have priority over the excise dues.
The petitioner is bonafide purchaser and that he should not be imposed with any liability to pay arrears of tax, payable by M/s. Moolchand Exports Limited, (In Liquidation) - petition allowed - decided in favor of petitioner.
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2018 (3) TMI 1326
Rate of tax - samosa - whether the rate of tax on Samosa should be 8% or 5%? - Held that: - the legislative intention is clearly to tax cooked food on the one hand and sweetmeats and namkeen as different items. Cooked food is taxed at a higher rate under the statute in question, as compared to sweetmeats and namkeen. There cannot be any generalization and the Court would necessarily have to find assistance of the statute, in question - samosa is certainly cooked food and since it satisfies requirement of cooked food otherwise in a broad sense and since the other alternative is to tax it under namkeen which does not appeal to us, in the absence of any material or finding in the orders, we are inclined to not overturn the order of the authorities, as confirmed by the Tribunal which is undoubtedly the fact finding authority as samosas are to be taxed at the rate of 8% for the first six months and, for the next six months, at the rate of 4%, on the basis that cooked food under the VAT Act attracted 4% - decided in favor of Revenue.
When this Court is called upon to decide the matter in terms of the substantial question of law, it has to decide the question as to what the law is and not on the basis of the treatment accorded to another dealer. There can be no scope for such consideration in revision which can be maintained only on the basis of substantial question of law.
Revision dismissed.
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2018 (3) TMI 1325
Composition Scheme - It is the case of the assesee that the SMR authority having determined the taxable income under the composition scheme ought not to have added tax under Section 3(2) of the Act as purchases on the goods supplied by the contractee to the contractor - Held that: - Tribunal proceeded only on the ground that the determination of tax based on the composition scheme is justifiable. It is hardly required to be stated that when particularly the assessee/appellant raises a ground and submits arguments on such point, it is obligatory for the Tribunal to address the said arguments and give a finding in accordance with law - matter remanded to the Tribunal for fresh consideration.
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2018 (3) TMI 1324
Principles of Natural Justice - the Assessing Officer failed to note the objection filed by the petitioner while passing the impugned assessment order - Held that: - it is deemed that all the records were available with the respondents when he passed the impugned assessment order. Therefore, fairness in procedure would require that the dealers' objection though given in two sets should be considered, otherwise, the assessment proceedings itself would become an empty formality - matters are remanded back to the first respondent for fresh consideration - petition allowed by way of remand.
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