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TMI Blog2009 (6) TMI 934X X X X Extracts X X X X X X X X Extracts X X X X ..... d under the Companies Act and had its office at Bandra (East) Mumbai and business activities in Maharashtra and was registered under the BST and CST Acts. The petitioner and M/s. Floatglass India Limited (amalgamating company) entered into scheme of amalgamation and according to the scheme of amalgamation Floatglass India Limited was to merge into the petitioner-company. The scheme was approved by a judge of this court exercising jurisdiction under the Companies Act by judgment and order dated July 24, 2003. In terms of the order of amalgamation, the date of amalgamation was with effect from April 1, 2002. The petitioner, the transferee-company, as it was not holding registration under the BST Act, 1959 applied for registration on August 19, 2003, after the order of amalgamation passed by this court. The date of merger as per the amalgamation scheme was from April 1, 2002. The application for cancellation of registration certificate of the amalgamating company was accordingly filed to cancel the registration certificate of the said company from April 1, 2002. The registration certificate of amalgamating company was accordingly cancelled by the competent authority from April 1, 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. Though in the scheme of amalgamation, the date of amalgamation may be set out, it is for the court ultimately to decide the date of amalgamation. In these circumstances, an application for registration can only be made after an order sanctioning the scheme of amalgamation. Like in the instant case, if the company court accepts the date given by the amalgamating companies, then it is not possible to adhere to the time-frame under the rules for making an application for registration within the time-limit specified so as to make it effective from the date of application. It is submitted that in these circumstances, the procedural rules must be so read as to give effect to the order of the company court and in these circumstances, for the purpose of rule 7(1)(ai), the date of application for registration can only be counted from the date of sanctioning the scheme of amalgamation. On the other hand, on behalf of the respondents it is submitted that rule 7(1)(ai) is clear. If this is read with section 19(6) of the BST Act, 1959, the date of application would be beyond sixty days from the date of succession of business and consequently in terms of rule 8(3) would be effective from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the appointed day, and (ai) within 60 days from the date of succession to the business as provided in sub-section (6) of section 19; and (b) in any other case, within 30 days from the day on which his turnover either of all sales or of all purchases during the year commencing on the 1st April , 1959 or as the case may be, during any subsequent year, first exceeds the relevant limit specified in subsection (4) of section 3. (2) An application for registration under section 22 shall be made in form 1 to the registering authority and shall be accompanied with a fee as prescribed under rule 65. (3) Where a dealer has more than one place of business within the State, he shall make a single application in respect of all such places except any place for which he has obtained a certificate of entitlement under the package scheme of incentives, specifying therein one of such places as the principal place of business and submit it to the registering authority within whose jurisdiction such principal place of business is situated: Provided that, where such dealer has obtained a Certificate of Entitlement under the Package Scheme of Incentives, (except the 1998 Power Generation Promotio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any goods to or from each other during the period commencing on the date from which the order is to take effect and ending on the date of the order, then notwithstanding anything contained in the said amalgamation order, such transactions of sale and purchase shall be included in the turnover of sales or, as the case may be, purchase of the respective companies and shall be assessed to tax accordingly, and for the purposes of this Act, the said two or more companies shall be treated as distinct companies and shall be treated as such for the entire period up to the date of the said order, and the registration certificates of the said companies shall be cancelled, or amended, where necessary, with effect from the date of the said amalgamation order. In other words, it would be clear that section 33C was introduced with a view to avoid escapement of sales tax of transactions between the two or more companies seeking to amalgamate. Irrespective of the date of order of the company court, the two companies should be treated as distinct in respect of the transaction which they had done amongst themselves. In other words, they cannot escape payment of tax on the ground that there is no sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AIR 1992 SC 96. The Supreme Court observed as under: "... The court cannot add words to a statute or read words into it which are not there. Assuming there is a defect or an omission in the words used by the Legislature the court could not go to its aid to correct or make up the deficiency. Courts shall decide what the law is and not what it should be. The court, of course, adopts a construction which will carry out the obvious intention of the Legislature but could not legislate itself. But to invoke judicial activism to set at naught legislative judgment is subversive of the constitutional harmony and comity of instrumentalities ..." We may consider the true scope of rules 7 and 8. Rule 7 deals with the application for registration of dealers. Rule 7(1)(ai) sets out that the application for registration under section 22 shall be made within sixty days from the date of succession to the business as provided under sub-section (6) of section 19. What would be the date of succession in business for the applicant to make the application? Section 19(6) sets out that an application shall be made within sixty days from the date of such succession. An ordinary reading therefor, after th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company Floatglass India Limited, is concerned, considering the provisions, its certificate of registration was cancelled from April 1, 2002. In other words, M/s. Floatglass India Limited ceases to be company from that date and that must be the date to give effect to section 19(6) and rule 7(1)(ai). There is therefore, an omission on account of the failure by the delegates to provide a corresponding rule to rule 7(1)(ai). In the absence of Legislature providing and taking note of the fact that in such cases, the amalgamating company is not at fault, it will have to be construed that the time for making an application for registration will be sixty days from the date of the court passing the order. On such application being made, certificate of registration will have to be made effective from the anterior date given by the company court. This is only a procedural requirement. This would avoid hardship and give true effect to the mandate of the Legislature both under the BST and the CST Acts. No order of a court should visit a party with liabilities and/or undesirable consequences in the matter of tax. The rule must be so read as to give effect to the legislative mandate. The date f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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