TMI Blog2019 (8) TMI 1290X X X X Extracts X X X X X X X X Extracts X X X X ..... iness activities enumerated in Section 2(n) directly or indirectly. In the instant case, it is the case of writ petitioner's vendor's mother carrying on three of the business activities, namely buying, selling and distributing petroleum products indirectly through her son. This Court having come to the conclusion that writ petitioner is carrying on business as a dealer not directly, but otherwise, even on an extreme demurrer, even if the expression 'or otherwise' is to be given a restricted meaning, it will still cover writ petitioner's vendor. The writ petitioner's vendor qualifies as a 'dealer' within the meaning of Section 2(n) and that writ petitioner's vendor's property i.e., said property will clearly be covered under Section 37(1) of PVAT Act. With regard to proviso to Section 37(2) which deals with bonafide transfer, there is copious and undisputed material before this Court to show that writ petitioner was carrying on day-today affairs of the business and in any event, learned senior counsel for writ petitioner made it clear that writ petitioner does not want to tread into that arena. Therefore this Court deems it appropriate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns in the affidavit filed in support of the writ petition has been captured by this Court in earlier proceedings dated 03.07.2019 and the same reads as follows: ' Read this in conjunction with and in continuation of earlier proceedings of this Court dated 1.7.2019. 2. Today, Mr.S.Prem Auxilian Raj, learned counsel on record for writ petitioner is before this Court. Mr.J.Kumaran, learned 'Additional Government Pleader (Pondicherry)' ('AGP' for brevity) is before this Court on behalf of all official respondents. Learned AGP submits that he has come in place of learned Government Advocate Mr.Stalin Abhimanyu and learned AGP will now be representing all the three respondents. 3. An order dated 30.10.2018 bearing Reference No.TIN: 34070001928/ADCTC-II/2018-19 (hereinafter referred to as 'impugned order') made by second respondent under 'The Pondicherry General Sales Tax Act' ('PGST' for brevity) and 'Pondicherry Value Added Tax Act, 2007 (Act No.9 of 2007)' {hereinafter 'PVAT Act'} has been called in question in the instant writ petition and therefore the same shall be ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he vendor of writ petitioner can be described as a dealer under PVAT Act. 11. To be noted, the term 'dealer' is a term of art qua PVAT Act as it has been defined under Section 2(n) of PVAT Act. 12. These proceedings have been captured and recorded for narrowing down issues that fall for consideration. 13. Matters of utmost relevance are as follows: (a) Date of assessment order under PVAT Act, qua Section 37(1) of the said Act. (b) Whether writ petitioner's vendor Mr.D.Sundar would qualify as a dealer under PVAT Act, within the meaning of Section 2(n) of the said Act. 14. Learned AGP seeks time to file counter-affidavit inter-alia, setting out aforesaid details and meeting out aforesaid points. 15. At the request of learned State Counsel, adjourned by a week. List on 11.7.2019.' 5.From the above, it can be seen that challenge to impugned order is predicated inter alia on the ground that writ petitioner is a bonafide third party purchaser. However, Sri.T.V.Ramanujam, learned senior counsel appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essed under this Act shall be paid in such manner and in such instalments, if any and within such time as may be specified in the notice of assessment, not being less than twenty-one days from the date of service of the notice. If default is made in paying according to the notice of assessment, the whole of the amount outstanding on date of default shall become immediately due and shall be a first charge on the properties of the dealer liable to pay the tax under this Act. (2) Where during the pendency of any proceedings under this Act, or after the completion thereof, any dealer or person creates a charge on, or parts with the possession by way of sale, mortgage, gift, exchange, or any other mode of transfer whatsoever, of any of his assets in favour of any other person, with the intention to defraud the revenue, such charge or transfer shall be void as against any claim in respect of any tax, or any other sum payable by the dealer as a result of completion of such proceedings or otherwise. Provided that, such charge or transfer shall not be void if it is made_ (a) for adequate consideration and without notice of the pendenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perty in goods (whether as goods or in some other form) involved in the execution of a works contract; (viii) a person engaged in the business of delivery of goods on hire-purchase or any system of payment by instalments; (ix) a person engaged in the business of transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (x) a person engaged in the business of supplying by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration; (xi) a society (including a co-operative society), club or firm or an association which, whether or not in the course of business, buys or sells goods from or to its members for cash or for deferred payment or for commission, remuneration or other valuable consideration; (xii) an industrial, commercial, banking, insurance or trading undertaking whether or not of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by learned senior counsel that 'any person' occurring in Section 2(n) is fixed i.e., writ petitioner's vendor's mother and it makes no difference as to whether she was carrying on business directly or otherwise i.e., through her son. It was submitted by way of illustration that it may even be a manager or cashier in the petroleum dealership outlet. 13. Per contra, learned State counsel submitted that 'any person' occurring in Section 2(n) is not fixed as there is copious material to show that writ petitioner's vendor was only carrying on day-to-day affairs of Sri Manakula Vinayagar Petro Agency. To be noted such material forms part of respondents' typed-set and they remain unrefuted. 'Any person' in Section 2(n) should be read as writ petitioner's vendor, who was carrying on business not directly, but otherwise. 14. Therefore, the lone question has further narrowed and it can be broken down into two micro questions, which read as follows: a) Whether the expression 'any person' occurring in Section 2(n) will accommodate only the writ petitioner's mother's vendor or it can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9; occurring in Section 2(n), in the considered view of this Court, the legislature in its wisdom has chosen to say 'any person' and not 'a person'. Therefore, intention was to take within its sweep different kinds of persons. In this view of the matter, this Court is unable to accept the submission that 'any person' is static and that it can refer only to writ petitioner's vendor's mother in this case. Another reason as to why this Court is unable to accept this contention is, PVAT Act does not stop with defining 'dealer'. It defines 'registered dealer' also. To be noted, 'registered dealer' is defined in Section 2(zc) of PVAT Act. Section 2(zc), which defines a 'registered dealer', reads as follows: '2(zc) registered dealer ' means a dealer registered under this Act.' 20. Therefore, a conjoint reading of 'dealer' and 'registered dealer' makes it clear that 'dealer' can be any person who carries on four kinds of business activities set out in Section 2(n), but 'registered dealer' can only be one and that one person or entity is the perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Bombay Land Requisition Act, 1948. Portions of Section 6 of said Act including Explanation (a) as extracted in the copy of Lila Vati Bai judgment placed before this Court reads as follows: '6.(1) If any premises situate in ail area specified by the State Government by notification in the Official Gazette, are vacant on the date of such notification and wherever any such premises are vacant or become vacant after such date by reason of the landlord, the tenant or the sub-tenant, as the case may be, ceasing to occupy the premises or by reason of the release of the premises from requisition or by reason of the premises being newly erected or reconstructed or for any other reason the landlord of such premises shall give intimation thereof in the prescribed form to an officer authorised in this behalf by the State Government. ........................................................................... (4) Whether or not an intimation under sub-section (1)is given and notwithstanding anything contained in section 5, the State Government may by order in writing- (a) requisition the premises for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ti Bai case and this approach has in turn been adopted by Hon'ble Supreme Court by placing reliance on the celebrated Skinner Co. V. Shew and Co. reported in (1893) 1 Ch 413 (K) where the words 'or otherwise' used in Section 32 of the erstwhile Patents, Designs and Trade Marks Act, 1883 in England were interpreted in Skinner Co. case. 26. In the instant case, with regard to generic words 'or otherwise' which we are concerned with, this Court has no hesitation in holding that Lila Vati Bai principle, being a Constitutional Bench judgment of Hon'ble Supreme Court, can be applied as these generic words used in Explanation (a) to Section 6 of Bombay Land Requisition Act and Section 2 (n) of PVAT Act are not different. It is nobody's case that deployment of these generic words are different in Explanation (a) to Section 6 of said Act and Section 2(n) of PVAT Act. 27. This takes us to the question as to whether the expression 'or otherwise' is an extension for directly i.e., an extension for the manner in which business is carried on or extension to the kinds of business activities. As already mentioned sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t would only mean 'any person' who carries on any or some of the kinds of business activities enumerated in Section 2(n) directly or indirectly. In the instant case, it is the case of writ petitioner's vendor's mother carrying on three of the business activities, namely buying, selling and distributing petroleum products indirectly through her son. 31. Therefore, this Court having come to the conclusion that writ petitioner is carrying on business as a dealer not directly, but otherwise, even on an extreme demurrer, even if the expression 'or otherwise' is to be given a restricted meaning, it will still cover writ petitioner's vendor. As already alluded to supra, this is because the term 'registered dealer' has been defined separately and writ petitioner's vendor's mother will qualify as 'registered dealer'. This Court is of the considered view that the width given to the term 'dealer' while defining the same is to eliminate the mischief of a person/entity carrying on some business without registering himself, herself or itself as a dealer and then getting away with it qua tax liability by saying that he i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he campaign of the writ petitioner in the instant writ petition as far as writ petitioner's challenge to the impugned order is concerned. However, this Court, before parting with this case, considers it appropriate to deal with two aspects of the matter. One aspect of the matter is, nothing prevents the writ petitioner from proceeding against his vendor for having palmed off a property, which was subject matter of first charge under Section 37(1) of TNVAT Act. There is no material placed before this Court to demonstrate that writ petitioner has issued any notice or initiated any proceedings against his vendor. If the writ petitioner now chooses to proceed against his vendor, this order will not impede such proceedings. 37. One other aspect of the matter is regarding communication to the jurisdictional Registrar's office about first charge on properties of a dealer when the same occurs under Section 37(1) of PVAT Act. Learned State counsel submits that as of now, there is no procedure to communicate such a charge when it occurs. This Court deems it pertinent to set out, obviously in a recommendatory tone that it would be appropriate for the Government to con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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