TMI Blog2018 (9) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... e of assessment and whether in the circumstances, the limitation for 5(five) years would apply? - Held that:- In the manner in which the assessment has been made it clearly appears to have been made under Section 31 of the TVAT Act and as such the limitation under Section 33 of the TVAT Act would apply. Therefore, the impugned notice dated 07.05.2014 and the order are without jurisdiction being barred by limitation under Section 33 of the TVAT Act. But the said bar is not applicable so far the impugned notice - if the jurisdiction under Section 10(a) is exercised by the authority on conforming to the conditions laid down therein, the limitation as prescribed by Section 33 of the TVAT Act will have no manner of application in such cases. Whether the petitioner is liable to pay further tax as the situs of sale falls within the jurisdiction of the State of Haryana? - Held that:- The purchase took place at Haryana and ‘C’ form has been used to get the benefit of reduced rate of tax under Section 8(1) of the CST Act. The word ‘resell’ or the provisions as appearing in Section 8(3)(b) if read jointly, the word ‘resell’ would take an expansive meaning. Thus, when there can be two inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Taxes, Belonia on 06.03.2014. It would be apparent from the said reply that the said machine was purchased for excavating the earth, loading earth in the truck vehicle, loading earth in the moulding machine and loading the moulding earth in the truck vehicle to lift the moulded earth in the place of preparation of green bricks by the labourer and for loading bats and bricks in the truck vehicle as well as for supplying the produced goods to destination of sale. 04. Despite such explanation, by the order dated 28.03.2014, the respondent No.4 exercised his jurisdiction under Section 10A of the CST Act for purported contravention of Section 10B of the CST Act and determined the tax at 12.5% with penalty under Section 10A at ₹ 3,46,875/- on the purchase value of ₹ 8,50,000/-. The petitioner has been asked by the said order dated 28.03.2014 to deposit a sum of ₹ 5,78,125/- by 27.04.2014. On 23.07.2014 delivered in CM Appl. No.319 of 2014 [from W.P.(C) No.284 of 2014] this court had passed the following order staying the recovery of the said demand: We are prima facie of the view that the petitioner has made out a case that the State had no jurisdiction, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt No.4 had observed as under: .....the petitioner has violated the provisions of CST Act by using the services of excavator in addition to excavating of earth which are not integrally connected with ultimate production of goods that commercially inexpedient. Again the guideline issued by the Commissioner of Taxes, Government of Tripura vide his office Memo No.F.I-7(6)-TAX/06(P-1)/2895-919, dated 18.03.2009 that the C Form can be used against interstate purchase of taxable materials which are re-sold/directly engaged in manufacturing works. It is also stated in the Memorandum that when the machineries being the taxable item is/are neither re-sold nor straight-way used/involved for manufacturing purpose, the C form cannot be used against such interstate purchase of machineries. 08. The petitioner has, according to the respondent No.4, utilised the service of the said excavator for several purposes in addition to excavation of earth for which purpose the excavator was procured or purchased. Hence the tax at 12.5% being ₹ 2,30,314/- and imposed penalty thereon under Section 10A at ₹ 3,45,471/-. Having considered the price value at ₹ 18,42,510/-, the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o authority to assess or pass any order in this regard having been barred under Section 33 of the TVAT Act, save it can be shown that the said order is covered under proviso to Section 33 of the TVAT Act. But there is no such assertion and in fact, no such action, adverse to the petitioner was taken before 07.05.2014 so far the purchase which is the subject matter of W.P.(C) No.448 of 2014 is concerned. 12. Mr. Pal, learned counsel however did not insist the same plea in W.P.(C) No.284 of 2014 for obvious reason as the purchase in the said case took place on 20.08.2009 meaning the five years limitation would start from 01.04.2010 and expire on 31.03.2014. But the notice has admitted by been issued by the respondent No.4 on 03.03.2014, within the period of limitation. But Mr. Pal, learned counsel has asserted that there had been no violation of Section 8(3)(B) of the CST Act. For purpose of reference, Section 8(3)(B) is reproduced hereunder: 8. Rates of tax on sales in the course of inter-State trade or commerce. [(1) Every dealer, who in the course of inter-State trade or commerce, sells to a registered dealer goods of the description referred to in sub-section (3), shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Provided that the declaration is furnished within the prescribed time or within such further time as that authority may, for sufficient cause, permit.] 13. Mr. Pal, learned counsel appearing for the petitioner has further submitted that the said provision unequivocally provides that if the good is used by the dealer in the manufacturing process of the goods for sale, he is entitled to get the benefit of tax under sub-section 1 of Section 8 of the CST Act. In this regard he has emphatically stated that excavation of earth and its transportation to the further process is inalienable part of manufacture of the green bricks. The apex court in Collector of Central Excise, Jaipur vs. Rajasthan State Chemical Works, Deedwana, Rajasthan reported in (1991) 4 SCC 473 , had occasion to dwell upon the meaning and ambit of the word manufacture and the process in the following manner: 14. The natural meaning of the word 'process' is a mode of treatment of certain materials in order to produce a good result, a species of activity performed on the subject-matter in order to transform or reduce it to a certain stage. According to Oxford Dictionary one of the meanings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t he is a registered dealer; or (d) after purchasing any goods for any of the purposes specified in 4[clause (b) or clause (c) or clause (d)] of sub-section (3) [or sub-section (6)] of section 8 fails, without reasonable excuse, to make use of the goods for any such purpose; (e) has in his possession any form prescribed for the purpose of sub-section (4) [or sub-section (8)] of section 8 which has not been obtained by him or by his principal or by his agent in accordance with the provisions of this Act or any rules made thereunder; [(f) collects any amount by way of tax in contravention of the provisions contained in section 9A,] he shall be punishable with simple imprisonment which may extend to six months, or with fine or with both; and when the offence is a continuing offence, with a daily fine which may extend to fifty rupees for every day during which the offence continues. 15. In the transaction, relevant in the context, there had been no of false representation. Even no such false representation has been established for violation of Section 10(b). Having situated thus, the respondent No.4 cannot invoke the jurisdiction provided under Section 10A fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 4 has admitted and asserted that the petitioner is a registered dealer under Section 19 of the TVAT Act and Section 17 of the CST Act. He has been registered as manufacturer, re-seller and importer etc. From the CST registration certificate, it would be apparent that the said registration under CST Act does not include the sale for manufacturing but only for resale. Mr. Nath, learned Addl. G.A. has referred the entry in the CST registration to submit that: 4. Excavator, parts and accessories‟ are only shown for purchase for resale. But the petitioner has purchased the excavator using C form and as such he has committed an offence for which he can be imposed penalty under Section 10A of the CST Act, 1956. 18. Mr. Nath, learned Addl. G.A. has further submitted that Section 8(3)(b) of the CST Act provides that C form shall be allowed to be used in respect of the goods of the class specified in the certificate of registration of the dealer. Since the petitioner‟s certificate is only for the resale, the said purchase cannot come under Section 8(1) of the CST Act. He has further submitted that Section 9 of the CST Act has no application in the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tances constituting the said offence. In the light of the language employed in Section 10-A and the nature of penalty contemplated therein, it cannot be held that all types of omissions or commissions in the use of Form C will be embraced by the expression false representation. Hence, a finding of mens rea is a condition precedent for levying penalty under Section 10(b) read with Section 10-A of the CST Act. In Sanjiv Fabrics (supra), it has been observed by the apex court as under: 37. Furthermore, it is evident from the heading of Section 10A of the Act that for breach of any provision of the Act, constituting an offence under Section 10 of the Act, ordinary remedy is prosecution which may entail a sentence of imprisonment and the penalty under Section 10A of the Act is only in lieu of prosecution. In light of the language employed in the Section and the nature of penalty contemplated therein, we find it difficult to hold that all types of omissions or commissions in the use of Form `C' will be embraced in the expression false representation . In our opinion, therefore, a finding of mens rea is a condition precedent for levying penalty under Section 10(b) read with S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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