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2016 (10) TMI 373 - PUNJAB AND HARYANA HIGH COURT

2016 (10) TMI 373 - PUNJAB AND HARYANA HIGH COURT - TM - Demand of tax - assessment by the Excise and Taxation Officer-cum-Designated Officer, Ludhiana-II under the Central Sales Tax Act, 1956 - the stock transfer to the tune of ₹ 11,54,54,462/- treated as interstate sale - business of manufacture and sale of iron and steel goods including galvanized steel pipes - material was transferred from the manufacturing unit of the petitioner located in the State of Punjab to its branch office at P .....

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s of Section 22 (1B) of the Act, regarding refund or transfer of the tax from the State of Bihar to the State of Punjab. As the Appellate Authority failed to exercise its jurisdiction on the plea raised by the petitioner, without even disturbing the findings recorded by the Appellate Authority regarding transaction being in the course of inter-state sale from the State of Punjab, the matter deserves to be remitted back to the Appellate Authority for dealing with the alternative prayer made by th .....

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1. Challenge in the present petition is to the order dated 30.4.2015 passed by the Central Sales Tax Appellate Authority, New Delhi (for short 'the Appellate Authority') in appeal filed by the petitioner against the order dated 6.5.2010 passed by the Value Added Tax Tribunal, Punjab (for short, 'the Tribunal') in Appeal (VAT) No.621 of 2009. 2. Learned counsel for the petitioner submitted that the petitioner is a company incorporated under the provisions of Companies Act, 1956. .....

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ce at Patna and thereafter local sale was made in the State of Bihar. As a consequence, local sales tax was paid under the Bihar VAT Act, 2005. 3. The assessment of the petitioner for the year 2006-07 was framed by the Excise and Taxation Officer-cum-Designated Officer, Ludhiana-II under the Central Sales Tax Act, 1956 (for short, 'the Act') on 13.1.2009 and the stock transfer to the tune of Rs. 11,54,54,462/- was treated to be interstate sale, as on the goods transferred by the petition .....

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impugned order dated 30.4.2015, the appeal was rejected, as the Appellate Authority also found that the transaction in question was in the course of inter-state sale and not a branch transfer. Alternative submission made by learned counsel for the petitioner before the Appellate Authority regarding refund of the amount of tax paid by the petitioner on the local sale in the State of Bihar on the same goods, was not considered, despite there being enabling provisions to that effect under Section .....

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e Authority in Hindustan Zinc Limited vs. State of Andhra Pradesh and others, (2012) 47 VST 1 (CSTAA), where under similar circumstances, the Appellate Authority directed for transfer of refundable amount from the State, where it was paid on the local sale to the State from where sale in the course of inter-state sale, was affected. The prayer is that the Appellate Authority having failed to exercise the jurisdiction vested in it under Section 22 (1A) of the Act, the matter deserves to be remitt .....

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ugh impleaded as respondent No.3 in the petition. 7. Heard learned counsel for the parties and perused the paper book. 8. The petitioner in the present case participated in the tendering process for sale of galvanized steel pipes, as floated by the Government of Bihar. After being successful, the goods manufactured with the marking 'GOB , were dispatched by the petitioner from State of Punjab to its branch office at Patna in the State of Bihar for further local sale to the department concern .....

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with a problem where initially the sale from State 'A' to State 'B' was treated as branch transfer. In State 'B', it was treated as a local sale. However, subsequently State 'A' sought to revise orders and treate the sale in the course of interstate trade instead of branch transfer already allowed, Hon'ble the Supreme Court observed that there is no mechanism to resolve these kinds of interstate issues, the Government was required to consider the same. As a co .....

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21 of the Act provides for procedure for filing of appeals. Whereas Section 22 provides for the powers of the Appellate Authority. Procedure to be followed by the Appellate Authority has been provided for in Section 23 thereof. 13. Section 24 of the Act provided that the Appellate Authority for Advance Rulings as constituted under the Income Tax Act, 1961 shall be notified as the Appellate Authority under this Act. 14. Section 25 of the Act provides for transfer of pending proceedings, whereas S .....

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on the same transaction: Provided that the amount of tax directed to be refunded by a State shall not exceed the amount of central sales tax payable by the appellant on the same transaction. 16. Section 22 (1B) of the Act clearly provides that the authority has power to issue direction for refund of the tax collected by a State, which has been held by the Appellate Authority to be not due to that State or alternatively direct the State to transfer the refundable amount to the State to which cen .....

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le. Alternative plea was raised that the amount of tax paid in the State of Bihar treating the sale to be local sale there, be directed to be refunded to the appellant or transferred to the State of Punjab. 18. The Appellate Authority vide impugned order opined that the view expressed by the Tribunal opining the transaction to be inter-state sale from the State of Punjab, was correct. The State of Bihar was also party before the Appellate Authority. The alternative prayer made by the petitioner .....

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opined that it would be appropriate if against the ruling of the Appellate Authority direct application for Special Leave to Appeal is entertained by Hon'ble the Supreme Court, were referred to. Rejecting the aforesaid view, it was opined that the order passed by the Appellate Authority can be challenged before the High Court under Article 226 and/or 227 of the Constitution of India. However, the petition challenging the same has to be heard by a Division Bench of the High Court and decided .....

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igh Courts for years and in the case of some High Courts, even in Letters Patent Appeals and then again in the Supreme Court. It appears to be appropriate to point out that considering the object of giving an advance ruling expeditiously, it would be consistent with the object sought to be achieved, if the Supreme Court were to entertain an application for Special Leave to appeal directly from a ruling of this Authority, preliminary or final, and render a decision thereon rather than leaving the .....

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se judicial superintendence over the decisions of all courts and tribunals within their respective jurisdictions is part of the basic structure of the Constitution. Therefore, to hold that an advance ruling of the Authority should not be permitted to be challenged before the High Court under Articles 226 and/or 227 of the Constitution would be to negate a part of the basic structure of the Constitution. Nonetheless, we do understand the apprehension of the Authority that a writ petition may rema .....

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