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2016 (10) TMI 123 - MADRAS HIGH COURT

2016 (10) TMI 123 - MADRAS HIGH COURT - TMI - Condonation of delay in filing the appeal before the Appellate Authority under Section 31 of the TNGST Act - holding company, holding 100% share of subsidiary company, Annamalaiar Textiles (P) Ltd. - transfer of old machinery and generator to subsidiary company without payment of tax - penalty imposed under section 12(5) of the TNGST Act - is the delay of 4709 days condonable holding that the delay was genuine? - Held that: - TNGST Act is the self-co .....

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e the relevant and necessary facts and therefore, the Tribunal on misconstruing the facts, had passed the order as if the objections have not been submitted. - Petition dismissed - delay not condoned - decided against petitioner. - W.P(MD)No.8167 of 2007 - Dated:- 27-9-2016 - MR.JUSTICE M.SATHYANARAYANAN AND MS.JUSTICE V.M.VELUMANI For the Petitioner : Ms.Lakshmi Sriram For the Respondent : Mr.R.Karthikeyan Additional Government Pleader for R.1 ORDER M.SATHYANARAYANAN,J. The petitioner in th .....

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re the first respondent, a turnover of ₹ 3,37,94,293.00 and a taxable turnover of ₹ 1,79,24,592.00 and paid the taxes along with the return for that assessment year. 1.2. The petitioner company filed a supplementary return during April 1984 including the turnover of cotton yarn on plain reel for ₹ 2,72,279.00 taxable at 3% and paid tax of ₹ 8,167.00 and it came to be filed during April 1984 for the inadvertent omission to include the above said turnover in the return alre .....

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ce, there was no necessity to include the above said transfer in the original return filed for the month of December, 1984 and as per the said return, the company reported a taxable turnover of ₹ 8,13,769.00 and paid a sum of ₹ 20,708.00 on 24.01.1985 and the supplementary return was filed on 31.01.1985 claiming exemption in respect of the transfer of machinery and the generator to the tune of ₹ 7,56,009.91. 1.4. The petitioner company, for the assessment year, 1983-84, had als .....

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aggrieved by the said order filed appeals before the Sales Tax Appellate Tribunal, Madurai Bench, in M.T.A.Nos.1051 and 1052 of 1985 and vide common order dated 18.08.1986, the Tribunal had set aside the penalty of ₹ 2,33,235.00 and further held that the same could not be taxed at the hands of the petitioner once again if the said turnover was already subjected to tax and accordingly, remanded to the first respondent for granting the relief in the light of the judgment reported in 21 STC 1 .....

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d a generator in the original return, but subsequently, claimed exemption through supplementary return. 1.7. The petitioner would further state that the first respondent vide proceedings dated 31.03.1986, issued the pre5 assessment notice, wherein he has proposed to levy tax on the turnover relating to the transfer of machinery and a generator made by the petitioner in favour of the subsidiary company to the tune of ₹ 4,54,401.00 at 12% single point; the transfer of machinery to the tune o .....

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me as incorrect and incomplete return for the purpose of levying penalty, the petitioner was called upon to file objections within fifteen days from the date of preassessment notice served on 09.04.1986. The petitioner after obtaining extension of time had filed it's objections during the first week of May, 1986. 1.8. The petitioner filed W.P.No.4593 of 1986 challenging the legality of pre-assessment notice dated 31.03.1986 and an order of interim injunction was granted on 20.05.1986 and it .....

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e of continuance of the interim order. The petition for amendment was ordered and so also, in the petition for interim order. 1.10. The Tamil Nadu Taxation Special Tribunal was constituted during the month of December, 1995 and the above said petition was transferred to the Special Tribunal, vide order dated 03.07.1997 in T.P.No.136 of 1997, wherein the following order has been passed: "Since the petitioner has come at the stage of notice, the petition is dismissed as premature, time is gra .....

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99 and it was returned and the petitioner was directed to get the seal of the office of the first respondent in the said copy and after obtaining the same, it was represented on 13.05.1999. 1.12. The petitioner also filed a separate petition to treat the appeal as filed within the limitation under Section 31 of the TNGST Act by reckoning the limitation from 16.04.1999 and not from 28.05.1986. The Appellate Authority, vide order dated 18.07.2001 had rejected the same as time barred and the petiti .....

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as ordered on 16.02.2004. 1.13. The Tamil Nadu Taxation Special Tribunal was abolished and all the matters were transferred to the file of this Court and therefore, the papers were represented and the transferred papers were also numbered as W.P.No.2294 of 2006. 1.14. It is the case of the petitioner that on account of the said reasons, the delay had occurred and it is on account of the genuine and bona fide reasons cited above which are also beyond his control and therefore, prayed for quashmen .....

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al order and the huge delay of 4709 days cannot be condoned by the first appellate authority under Section 31(1) of the TNGST Act. 3. The learned Counsel for the petitioner placed reliance on the judgment reported in 2009 VST 581 and would submit that as per the said judgment, from the date of repeal of 1992 Act, this Court will have the jurisdiction to entertain under Sections 37 and 38 of the TNGST Act as the provisions re-merge prior to 1992 Act and in the light of the same coupled with the f .....

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and only after the dismissal of the appeal petition by the Special Tribunal in T.P.No.136 of 1997 on 03.07.1997, the petitioner thought fit to apply for the certified copy of the final assessment order and obtained the same on 16.04.1999 and filed the same on 19.04.1999 after a delay of 13 years and the said delay cannot be condoned in the light of the judgment reported in 95 STC 533 (Madras). 5. Since the petitioner did not diligently prosecute the proceedings and also failed to explain the hu .....

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t order dated 15.05.1986 on the petitioner on 28.05.1986 by confirming the proposal as per the pre-assessment notice dated 31.03.1986. Thereafter, the petitioner filed W.M.P.Nos.8069 and 8070 of 1986 for amendment of the prayer and also for ad-interim injunction and they were ordered on 13.08.1986. Therefore, the petitioner was very well aware of the assessment order dated 15.05.1986. 8. The Tamil Nadu Taxation Special Tribunal came to be constituted and the said writ petition was numbered as T. .....

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as not done so either by the petitioner or by the Revenue. 10. The petitioner after the receipt of the said order, at least, ought to have approached the Tribunal either for modification or review, if it is permissible, but it has failed to do so. 11. According to the petitioner, since the Special Tribunal, vide order dated 03.07.1997, had granted time till 30.11.1997 to file objections, it was waiting for communication from the first respondent. In the considered opinion of this Court, in compl .....

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s. 13. It is the specific stand of the first respondent in the counter that the assessment order dated 15.05.1986 was served on the petitioner on 28.05.1986 itself and the said fact is not at all seriously disputed by the petitioner. The first respondent also took a stand that though the Special Tribunal has granted time till 30.11.1997 to file his objections, it did not do so, but factually it did submit the objections to the pre-assessment notice, on 05.05.1986, based on which, the final asses .....

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y is nearly 13 years (4709 days) and incidentally, a question arises for consideration whether such an appeal is condonable or not, even for the sake of argument that plausible explanation has been offered by the petitioner. 17. Section 31 of the TNGST Act speaks about the appeal to the Appellate Assistant Commissioner and as per sub-section (1) of Section 31 of the Act, the appeal is to be preferred within thirty days from the date on which the order was served on him in the manner prescribed a .....

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