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TMI Blog2019 (2) TMI 927X X X X Extracts X X X X X X X X Extracts X X X X ..... was doing well and returns were being filed in time and tax was also duly paid as required by law till the year 2005. 5. It appears that on account of floods in the river Tapi near Surat, the petitioner suffered huge losses and the business losses started mounting. It appears that on account of nonpayment of outstanding tax dues several properties of the petitioners had been attached and several proceedings came to be initiated, even at the stage of this court, and the petitioners faced several hardships, as set out in the memorandum of petition. Notices for cancellation and suspension of the registration certificate came to be issued to the petitioners and by an order dated 28.10.2016, the first petitioner firm's registration certificate under the Value Added Tax Act, 2003 came to be suspended till March 2017. By an order dated 12.12.2017, the first petitioner's registration certificate under the Value Added Tax Act came to be cancelled with effect from 1.9.2016. 6. In the meantime, the petitioners had applied for issuance of C-Form declarations in respect of inter-State purchases made by them from the manufacturer-Hero Motocorp Limited. The declaration forms were required by He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority. It was submitted that it is an admitted position that at the time when the sales took place, the petitioner was duly registered. Reference was made to the provisions of rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957 (herein after referred to as "the rules") to point out that the same provides that the declaration and certificates referred to in sub-section (4) of section 8 shall be in Forms C and D respectively. Since this case relates to purchases made by a registered dealer, the appropriate form is Form C. 10. The attention of the court was invited to Form-C which is the form of declaration prescribed under sub-rule (1) of rule 12 of the rules. It was submitted that, in the light of the provisions of sub-section (1) and sub-section (4) of section 8 of the Act, when the registered dealer, to whom the goods are sold, furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sales Tax Act, to the extent the same is relevant for the present purpose, reads thus:- "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 liable to pay tax under this Act, which shall be three per cent of his turnover or at the rate applicable to the sale or purchase of such goods inside the appropriate State under the Sales tax law of that State, whichever is lower: Provided that the Central Government may, by notification in the Official Gazette, reduce the rate of tax under this sub-section 3. (4) The provisions of sub-section (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority: Provided that the declaration is furnished within the prescribed time or within such further t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate purchases made by it. Besides, Form-C is issued under the Central Sales Tax Act and in the absence of any dues under that Act being outstanding, it is not permissible for the respondents to refuse to issue Form-Cs on the ground that tax under other enactments is outstanding. In fact even if there were outstanding dues under the Central Sales Tax Act, it would not be permissible for the respondents to refuse to issue Form-Cs, if the requirements of section 8 of the Act are satisfied. 18. Insofar as the case of the respondents that on account of the system being computerized, it is not possible to generate Form-Cs in the case of the petitioner unless its registration is restored is concerned, the statutory right of the petitioner cannot be defeated on account of some procedural difficulty on the part of the respondents. If under the statute the petitioner is entitled to issuance of C-Form in respect of the purchases made by it in accordance with law while its registration was in force, it is incumbent upon the respondents to issue C-Forms to it. If it is not possible to issue C-Forms under the computerized system, such C-Form declarations may be issued manually, but the respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orms. Thus, through a condition prescribed in the said circular, the State Government requires that a dealer must have discharged all his self assessed tax liabilities before C forms can be obtained in connection with any of his dealings. Essentially, this amounts to a mode of tax recovery. Even if it is self assessed tax, the prescription of the circular does not lose its essential character of one being in the nature of tax collection. Unless and until such a condition is backed by any statutory provision, it would not be possible for the State Government to provide such a mode of tax recovery making it a pre-condition for generation of C forms. As noted, had such a condition been introduced by framing statutory rules in exercise of powers under sub-sections (3) and (4) of Section 13 of the CST Act, we would have examined the question further. However, the circular in the form of executive instructions cannot take shape of a statute. What is envisaged in sub-sections (3) and (4) of Section 13 is the power of delegated legislation vested in the State Government for carrying out the purposes of the CST Act. Such rule making power cannot be substituted by executive instructions. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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