TMI Blog2016 (4) TMI 1310X X X X Extracts X X X X X X X X Extracts X X X X ..... 2006 and hence, the scheme by its very nature is retrospective in effect, viz. applicable to past transactions. It is an admitted position that in the facts of the present case, the petitioners seek the benefit of the Scheme in relation to the years 2010-11, 2011-12 and 2012-13 which are well within the ambit of the Scheme namely, between 1st April, 2006 and 14th October, 2014. If the interpretation put forth by the respondents were to be accepted, the same would result in a situation where dealers who have paid their taxes prior to the coming into force of the Scheme, would be denied the benefit thereof, whereas those dealers who have not paid the taxes would be granted the benefit of the Scheme, which would be clearly violative of the constitutional provisions as envisaged under Article 14 of the Constitution of India and would amount to putting a premium on non-payment of taxes whereby dealers who have not paid taxes steal a march over those dealers who have paid their taxes in time. Petition allowed - respondents are hereby directed to forthwith grant the benefit of the Amnesty Scheme dated 14th October, 2014 to the petitioners - decided in favor of petitioner. - SPE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by builders, then the transactions would only attract stamp duty and no tax was payable on such transactions under the Value Added Tax Act. According to the petitioners, though in case of K. Raheja Development Corporation v. State of Karnataka, 141 STC 298 (SC), the Supreme Court held that the contract which was for scrutiny before it involved sales in the execution of works contract, it was also clarified that if the sale was of fully constructed property, then it did not involve sale in the execution of works contract liable to sales tax. Subsequently, the Allahabad High Court in the case of Assotech Reality Pvt. Ltd. v. State of Uttar Pradesh and Another , 8 VST 738 (All.), explained the decision of the Supreme Court in the case of K. Raheja (supra) and concluded that in that case, the developer was not selling goods in the execution of a works contract and, therefore, did not have the tax liability under the Uttar Pradesh Trade Tax Act. Thereafter, the Supreme Court in the case of Larsen Toubro Limited v. State of Karnataka, 17 VST 460 (SC), doubted the correctness of the earlier decision in the case of K. Raheja (supra) and the matter was referred to the larger ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e larger bench of the Supreme Court in the case of Larsen Toubro Ltd. v. State of Karnataka , 65 VST 1 (SC), held that the agreement to sell flats/offices during the course of construction constitutes works contract and hence, it involves deemed sales. There were many builders in the State of Gujarat who had not paid tax under the GVAT Act and hence, were faced with huge interest and penalty liabilities. Representations were made by various associations before the Government of Gujarat requesting for administrative relief. In response thereto, on 14th October, 2014, the Government of Gujarat notified the Amnesty Scheme for grant of waiver of interest and penalty to builders whose transactions were taxable in terms of the decision of the Supreme Court in the case of Larsen Toubro Ltd. (supra). Benefit was also made available to those dealers whose cases were pending in appeal, if the appeal was withdrawn. 3.2 Since the petitioners wanted to avail of the benefit of the Amnesty Scheme, on 8th January, 2015, they made an application before the Tribunal for withdrawal of the second appeals. On 13th January, 2015, the petitioners made application under the Amnesty Scheme in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14) 1 SCC 708. It was submitted that the petitioners have admittedly paid tax and interest even prior to passing of the provisional assessment orders in the year 2012-13. The application under the Amnesty Scheme has been filed within the stipulated time limit. Thus, all the conditions for being eligible to avail of the benefit of the Amnesty Scheme are satisfied and the petitioners are entitled to get waiver of the penalty imposed on them. It was submitted that the contention of the respondents that the benefit of Amnesty Scheme cannot be granted to the petitioners since the payment of tax was made prior to the date of the Amnesty Scheme is based upon a gross misinterpretation of the Scheme inasmuch as paragraph 7 of the Amnesty Scheme only provides that full payment of tax is required to be made before the expiry of the Scheme and cannot be interpreted to imply that benefit of the Amnesty Scheme would not be granted to dealers who made payment of tax even prior to the date of the Scheme. According to the learned counsel, such interpretation would lead to an incongruous situation whereby the dealers who had paid tax earlier in point of time would be denied the benefit of the Amnest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before the Gujarat Value Added Tax Tribunal in Second Appeals No.92 to 94 of 2013 which came to be withdrawn with a view to avail of the Amnesty Scheme; however, the Amnesty Scheme being prospective in effect, would not be applicable to the petitioners. The attention of the court was invited to paragraph 7 of the Amnesty Scheme which provides that the dealer shall be entitled to the benefit of the Scheme only after payment of the tax liability during the period of the Scheme. It was submitted that, therefore, the provisions of the Scheme are applicable only in those cases where the payment is made during the period of operation of the Scheme and that the petitioners having paid the tax and interest prior thereto, are not entitled to the benefit thereof. It was, accordingly, urged that the petition being devoid of merits, deserves to be dismissed. 6. In the backdrop of the facts and contentions noted hereinabove, it appears to be an admitted position that except for the fact that the petitioners had already paid the tax and interest prior to the coming into force of the Scheme, the respondents do not deny that the petitioners have otherwise satisfied all the requirements of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is clarity in the legal position and hence, with a view to see that such contractors and developers can pay taxes for the period from 1st April, 2006 and such works contractors and developers can be brought within the tax net, it has been decided to grant remission under the provisions of section 41. In this respect, the Scheme has been declared as provided under paragraphs 1 to 14 of the Memorandum. 9. On a reading of the Preamble and the Memorandum of the Amnesty Scheme, it is clear that the benefit of the Scheme is to be given in respect of transactions commencing from 1st April, 2006. The contention of the respondents that the Scheme is prospective in effect and, therefore, the petitioners are not entitled to the benefit thereof, therefore, is clearly based upon a misconception of the provisions of the Scheme which clearly provide for granting benefit thereof with effect from 1st April, 2006 and hence, the scheme by its very nature is retrospective in effect, viz. applicable to past transactions. It is an admitted position that in the facts of the present case, the petitioners seek the benefit of the Scheme in relation to the years 2010-11, 2011-12 and 2012-13 which are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10 and 13 thereof, which clearly indicate that all those dealers who have paid the taxes during the period of operation of the Scheme and prior thereto are brought within the ambit thereof. 12. Under the circumstances, the second ground raised by the respondents for denying the benefit of the Amnesty Scheme to the petitioners is also not in consonance with the provisions of the Scheme. The respondents are, therefore, not justified in denying the benefit of the Amnesty Scheme to the petitioners. The above view is fortified by the view taken by the Karnataka High Court in the above referred decisions. 13. Examining the case from another angle, if the interpretation put forth by the respondents were to be accepted, the same would result in a situation where dealers who have paid their taxes prior to the coming into force of the Scheme, would be denied the benefit thereof, whereas those dealers who have not paid the taxes would be granted the benefit of the Scheme, which would be clearly violative of the constitutional provisions as envisaged under Article 14 of the Constitution of India and would amount to putting a premium on non-payment of taxes whereby dealers who have not p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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