TMI Blog2019 (5) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... ave to be allowed and the payment of tax on the remaining value as per the return filed by the petitioners up to 20th January, 2015 should be held as valid, appears to be correct. It is an accurate understanding of this court s order. This is not a case of any undue or uncalled for or illegal benefit being conferred on the dealer. This is a case of misreading and misinterpretation of the judgment of this court. Merely because the order of 11th September, 2006 is set aside by the Maharashtra Sales Tax Tribunal by its judgment and order dated 20th January, 2015, the transactions covered and dealt with by that judgment, which gave rise to a tax liability, cannot now be reopened. This Court has clearly dealt with the issue of prospectivity to the order of the MSTT in the light of section 52(2) of the BST Act. Once this Court has come to the conclusion that this was a fit case where the MSTT ought to have exercised its discretion and granted prospective effect to its judgment and order , then, the contention of Shri Sonpal that the order of the MSTT having merged with the order of the Commissioner and therefore the effect of prospectivity has to be from the year 2006 , can only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer pass appropriate Orders of rectification for the period 2011-12 2013-2014 to give the effect of prospective effect in both the years in terms of the judgment and Order of this Hon ble Court dated 22.03.2018. (e) Pending the notice, admission and final hearing of this Petition this Hon ble Court, restrain the Respondents from raising any demand for any years up to 2001-2015, by disallowing goods return claim as also treating the process as Manufacture and permanently thereafter. (f) Pending the notice, admission and final hearing of this Petition this Hon ble Court may be pleased to stay the recovery of demand raised by the impugned Assessment Orders passed for the periods 2013-14 and 2011-12. (g) No coercive measures of recovery be taken against the Petitioner by the Respondents based on the assessments under challenge for the period 2011-12 and 2013-14. (h) Hearing of this Petition may please be expedited. (i) Ex-parte Ad-interim relief in terms of prayer (e), (f) and (g) herein above. (j) Any such orders that the Court may deem fit. The facts of the case in brief are as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne by BPCL to RIL was exempt as during the relevant period kerosene was an exempt commodity. Similarly, question (c) was answered by stating that sale of kerosene (without N-Paraffin) returned by RIL to BPCL is also kerosene, exempt from tax under entry 160 of notification issued under section 41 of BST Act. 8. The Second question was also answered in favour of RIL and BPCL holding that transaction of return of kerosene by RIL to BPCL amounts to return of goods by RIL to BPCL in terms of rule 4 of the BST rules and not sale. 9. Several rounds of litigation thereafter ensued. Suffice it to observe that it was for the first and last time in the history of Bombay Sales Tax Act, DDQ by Commissioner was challenged by the State before the Maharashtra Sales Tax Tribunal ( MSTT for short). The MSTT by order dated 20th January 2015 overruled the order of the Commissioner and held that the return stream of kerosene was not a return of goods and hence liable to be taxed as a sale. The MSTT also in its order rejected the plea of the BPCL and RIL to grant prospective effect to its order under section 52(2) of the BST Act. The order of DDQ passed in 2006 was reversed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15. Simply put, it is the petitioner s case that once this Court vide judgment and order dated 22/03/2018 exhaustively dealt with the contention as regards prospective effect and having specifically held that the MSTT was unjustified in not granting the prospective effect to its judgment and order dated 20/01/2015, also having further observed we feel that this was a fit case where the MSTT ought to have exercised its discretion and granted prospective effect to its judgment and order.... , the impugned assessment orders, therefore, are unsustainable in the teeth of the order passed by this Court. 16. Learned Senior Counsel Shri R.A.Dada appearing on behalf of BPCL invited our attention to the order passed by this Court in Writ Petition No. 2217 of 2015. Learned counsel submitted that under section 52(2) of BST Act, the Commissioner has power to give prospective effect to DDQ order passed by the Commissioner under section 52(2) of the said Act. It was urged that the DDQ order of the Commissioner dated 11/09/2006 was in favour of RIL and BPCL. Learned Senior Counsel invited our attention to judgment and order of this Court dated 22/03/2018, wherein it is observed, this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Senior Counsel, the decision of this Court is binding on respondent No.3. Learned Senior Counsel would submit that it would not be open in the teeth of the order passed by this Court, now to construe section 52(2) of BST Act differently. Learned Counsel would submit that once this Court holds that the order of the MSTT has to be given prospective effect in terms of section 52(2) of the BST Act, respondent No.3 is obliged to act in accordance with the directions of this Court. Learned Senior Counsel relied upon the decision of the Apex Court in the case of Kone Elevator India Pvt. Ltd. Vs. State of Tamil Nadu and ors. (2014) 71 VST 1 (SC). 20. On the other hand, learned counsel Shri Sonpal appearing on behalf of respondents argued in support of the impugned order of assessment. He invited our attention to the provisions of section 52(2) of BST Act. He would submit that the MSTT having interfered with the order passed by the Commissioner, the liability relates back to the date of the order passed by the Commissioner and not from the MSTT s order. In his submission, the order passed by the MSTT has merged with the order passed by the Commissioner. Relying on the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harashtra Value Added Tax Act, 2005, still, the learned senior counsel appearing for the petitioners would submit that forcing the petitioners to pursue an Appeal would be inequitable and unjust given the fact that the core issue on merits is answered against the Department/Revenue and in favour of the petitioners. 24. Pertinently, the period covered by this assessment order is 1st April, 2013 to 31st March, 2014. There, a show cause notice in Form 301, a reminder for the above period was issued and the parties appeared before the Deputy Commissioner of Sales Tax. M/s.Reliance Industries Limited argued that it has entered into an agreement with M/s.Bharat Petroleum Corporation Ltd. (BPCL) for supply of Superior Kerosene Oil through pipeline from the refinery of M/s. BPCL located at Mahul and Ms/Reliance Industries Limited, after extraction of N-Paraffin from the Kerosene Oil, returned the goods through pipeline. In the case of previous transactions, arising out of this agreement, the Commissioner had passed an order on 11th September, 2006. Aggrieved by this order of the Commissioner, the Government of Maharashtra preferred an appeal before the Maharashtra Sales Tax T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sales turnover to the tune of ₹ 2692,80,63,558/and consequential levy of tax and penalty be deleted. The assessing officer refused to do so simply because the petitioner has itself stated that by the order of 20th January, 2015, the tribunal ought to have allowed the prospective effect to its order and protect the liability of both, Reliance Industries Limited and BPCL for all the periods up to the period ending 20th January, 2015. The determination of the disputed question by the Commissioner dated 11th September, 2006 was binding it until the tribunal intervened and set it aside. 29. If we take the period of assessment, it is evident that the same is 1st April, 2013 to 31st March, 2014. In this writ petition, the petitioner, in para 20 says that it received the assessment order for the financial year 2011-12 on 23rd October, 2017 and that raised exorbitant demand by disallowing the goods return claim and treating the same as taxable. The tax levied on the goods return is to the tune of ₹ 336,60,07,947/. The assessment is topped with levy of interest and penalty. As the petitioner was protected by the stay granted by this court, it filed a formal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arlier year, the second Assessment order also raises an exorbitant demand. The turnover of sales of the Petitioner was enhanced and subjected to full rate of tax. The demand raised is to the tune of ₹ 166,51,76,429/along with interest of ₹ 133,21,41,184 and penalty ₹ 65,99,888/( Exhibit A herein). 28. With the introduction of Section 26(6A) under the MVAT Act. There is mandatory part payment as a condition precedent for admission of appeal and grant of stay. As per this amendment 10% of disputed tax with a maximum limit of 15 crores is fixed as mandatory Pre deposit. Therefore in the present case Petitioner would be called upon to pay 10% of the disputed tax under the MVAT and CST Act (subject to maximum 15 crores in an appeal). The Petitioner submit that exorbitant liability is created as a deliberate mischief, ignoring the clear directions of the High Court Judgment. The Order is therefore without jurisdiction, illegal, vindictive and vexatious, raising the following demand: (Figures in rupees) Act Tax Interest Penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the prospective effect be given to the order of the Tribunal up to 20th January 2015. The directions essentially mean that the decision on merit will not apply to any transactions/ periods prior to 2001-2015. It would also mean that the effect of the DDQ by Commissioner would continue upto 2001-2015, (till it is reversed by Tribunal). The Order of Determination is binding on all the authorities for all the acts administered by the State of Maharashtra. Therefore, for all the transactions prior to this date, similar to the transactions in dispute, the Petitioner should be allowed goods return claim so that the Petitioner is not adversely affected on account of the Hon ble High Court s decision on merits. The Petitioner submits that the Hon ble High Court has considered all the aspects and facts of the case minutely, considered the arguments made on both the sides and exercised the discretion for grant of relief of prospective effect. Assessing Officer misinterpreted the Judgment of the Supreme Court in Kone Elevators (71 VST 1 (SC). 31. In the backdrop of the above, if the impugned assessment order is perused, it is apparent that the assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .52. Determination of disputed questions (1) If any question arises, otherwise than in proceedings before a Court, or before the Commissioner has commenced, assessment or reassessment of a dealer under section 33 or 35, whether, for the purpose of this Act; (a) any person, society, club or association or any firm or any branch or department of any firm, is a dealer, or (b) any particular thing done to any goods amounts to or results in the manufacture of goods, within the meaning of that term, or (c) any transaction is a sale or purchase, or where it is a sale or purchase the sale price or the purchase price, as the case may be therefor, or (d) any particular dealer is required to be registered, or (e) in the case of any person or dealer liable to pay tax, any tax is payable by such person or dealer in respect of any particular sale or purchase, or if tax is payable the rate thereof, the Commissioner shall subject to rules, make an order determining such question. [ Explanation For the purpose of this subsection, the Commissioner shall be deemed to have commenced assessment or reassessment of dealer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioners to consider the plea for grant of prospective effect to the decision of the MSTT. After setting out the contentions of the learned Senior Counsel and hearing them at length, this Court after reproducing section 52 of the said Act, said as under: what is ex-facie clear from reading the provisions of section 52 is that the Commissioner, in the given facts and circumstances of the case, certainly has the power to exercise his discretion and give prospective effect to the DDQ order passed by him under section 52(1). As correctly submitted by Mr. Venkatraman as well as Mr. Dada, in the facts of the present case, since the DDQ order dated September 11, 2006 was passed in favour of the assessee, there was no occasion nor any reason to request the Commissioner to grant prospective effect to his order. The question of prospective effect would only arise when the order of the Commissioner was reversed by the Tribunal vide the impugned order dated January 20, 2015. Further, it is not in dispute before us that it is for the first time in the history of the Bombay Sales Tax Act that the DDQ order passed by the Commissioner under section 52(1) was challenged by the State of Mah ..... X X X X Extracts X X X X X X X X Extracts X X X X
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