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TMI Blog2009 (1) TMI 798X X X X Extracts X X X X X X X X Extracts X X X X ..... es with retrospective effect without affording due opportunity of hearing to the petitioner. Since the issues involved in both the petitions are same, with consent of the parties, they are heard together and disposed of by this common judgment. Shorn of unnecessary details, the relevant facts and circumstances giving rise to these writ petitions are that the petitioner is a small-scale industrial unit having permanent registration No. 151502135 issued by the District Industries Centre, Bhubaneswar. It carries on business of processing and benefaction of mineral ores. The petitioner was registered under section 9A of the OST Act bearing registration certificate No. BH-II-1229 with effect from December 3, 1992 and under the CST Act bearing Registration Certificate No. BHC-11-849. The petitioner had been filing returns regularly and its registration certificate had been renewed every year till 1998-99. For the year 1999-2000, the petitioner had applied for renewal of registration certificate in prescribed form IIA of the Orissa Sales Tax Rules, 1947 (hereinafter referred to as, "the OST Rules") on April 12, 1999 with a petition for condonation of delay caused in making application f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the STO in cancelling the registration certificates issued to the petitioner under the OST Act and the CST Act so also the revisional authority is fully justified in upholding the action of the STO. He further submitted that the authority granting registration certificate has the power to cancel the same as per section 22 of the General Clauses Act. Rules 6, 6A and 7 of the OST Rules, which deal with grant of registration certificate, authorise the STO to act as prescribed authority, and the cancellation of registration certificates vide annexure 6 was done by him by way of abundant caution. The revisional authority has also passed a reasoned order upholding the action of the STO. The contention of the petitioner that no power has been delegated to the STO to cancel its registration certificate at the relevant time was neither raised before the revisional authority nor has any such pleading been taken in any of the writ petitions. Therefore, at this stage, such plea should not be entertained by this court. It was further argued that opposite party No. 3 served notice bearing No. 9307 dated May 26, 1999 to show cause as to why the registration certificates should not be cancel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n cancelled under section 9(6)(b) of the OST Act and section 7(4)(b) of the CST Act with effect from April 1, 1999. But the fact which remains undisputed is that the petitioner filed "nil returns" for three consecutive financial years, i.e., 1996-97, 1997-98 and 1998-99 on the ground that there was no transaction of purchase and sale during these years as stated in paragraphs 3 and 4 of the writ petition. The revisional authority in its order dated December 16, 2004 has held that the dealer had also no business during the year 1999-2000. Section 4 is the charging section, which deals with incidence of taxation. The liability to pay tax arises by virtue of the charging section alone. The liability to pay tax in case of a dealer comes into existence when the gross turnover exceeds the limit specified under section 4(7) of the OST Act. Sub-section (3) thereof says that the liability shall remain in force for three consecutive years although the gross turnover did not exceed the limit specified under sub-section (7). It further says that after the date of expiry of the period as may be prescribed, the liability of the dealer to pay tax under the Act shall stand ceased. In that event, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, initially, registration under section 9A of the OST Act was granted to the petitioner, as he was not liable to pay tax under section 4 of the OST Act at the time of granting registration under section 9A of the OST Act. Subsequently, as it reveals from the assessment record maintained for the years 1994-95 and 1995-96, the petitioner returned its gross turnover at Rs. 2,99,612 and Rs. 2,20,250, respectively, and has been assessed on such turnover by the assessing officer. Thus, at least from the year 1994-95, the dealer must have been treated as a dealer registered under section 9 of the OST Act and in that event section 9(6)(b) is squarely applicable for cancellation of registration certificate of the petitioner. Apart from this, sub-section (6) of section 4 says that a dealer who is not liable to pay tax under the foregoing sub-sections shall nevertheless be liable to pay tax on sale or purchase, if such dealer is liable to pay tax under the CST Act or is registered as a dealer under the said Act. By virtue of sub-section (6) of section 4, a dealer is liable to pay tax under the OST Act, if he is liable to pay tax under the Central Sales Tax Act or registered as a dealer u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te business again. In the case at hand, learned counsel for the petitioner has failed to satisfy this court as to why such a convenient course has not been resorted to by the petitioner for obtaining a fresh registration certificate to carry on his business instead of challenging the orders of cancellation through revision and writ mostly on technical grounds. That apart, in the meantime, a reform has been brought to the sales tax system in various States of the country. Pursuant to such reform, the Orissa Value Added Tax Act, 2004 came into force with effect from April 1, 2005 in place of the OST Act in the State of Orissa. On being asked, the learned counsel for the petitioner also could not satisfy this court as to why the petitioner has not taken any step to obtain the registration certificate under the newly introduced VAT Act, 2004, to carry on its business. A prudent businessman is always in search of a way to solve his problem in the best convenient manner. His aim is to carry on business without involving himself in unnecessary and undesirable disputes for litigation sake. This is the normal human behaviour. In the present case, we do not find any reason as to why such a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business transaction by investing Rs. 3.90 lakhs with IFCAL (Idcol Ferro Chrome & Alloys Limited) against EMD of a tender and Rs. 17.5 lakhs deposited to TISCO against the order for supply of materials like low ash metallurgical coke fines. If the petitioner wants to start business again nothing debars him to apply afresh for getting registered under the OST and CST Acts. By presenting all the facts before the concerned Sales Tax Officer and if such an application is made this cancellation order of registration certificate will, in no way, affect in getting him registered under both the Acts again. During the preceding years when he has no business there is no justification for claiming restoration of R.C. ..." Mr. Paikray, learned counsel for the petitioner, has also not been able to satisfy this court in what manner any prejudice was caused to the petitioner because of cancellation of registration certificate of the petitioner with effect from April 1, 1999, when it had no business during the preceding three consecutive financial years and also in the year 1999-2000. The honourable apex court in Rajendra Singh v. State of Madhya Pradesh AIR 1996 SC 2736 held that while examinin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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