TMI Blog2019 (11) TMI 553X X X X Extracts X X X X X X X X Extracts X X X X ..... use notice, wherein, he was called upon to complete the VAT/CST assessment along with the entry tax for the financial year 2013-2014. It is, therefore, clear that if the petitioner/ appellant is aggrieved by it, it is an order of assessment. At the end of the assessment, there is a tax liability. That is crystallised and a notice of demand is issued to the petitioner. When the appeal is against such a tax liability, the petitioner cannot contend that because a paltry amount was deposited under protest prior to the assessment and at the time of investigation, that be adjusted against the pre-deposit contemplated by section 26(6A) of as compliance with subsection (6A) of section 26 of the MVAT Act. If this argument of Mr. Sridharan is accepted, it would mean that a payment under protest made at the time of investigation to avoid tax liability or to escape assessment would suffice and on the strength of that, the appeal would be entertained despite there being no proof of payment of the aggregate of the amounts as set out in clauses (a) and (b) of sub-section (6A) of section 26 of the MVAT Act. While it is true that payment under protest cannot be regarded as acceptance of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sible for the transportation of the purchased natural gas from Gujrat to its unit. It is the case of the petitioner that they have been filing proper returns under the MVAT and the CST Acts and approximately been paying tax to the extent of ₹ 19 Crores every year to the State of Maharashtra in the form of MVAT or CST. 5. With effect from 08.01.2003, the earlier Entry Tax Ordinance of 2002 (Mah. Ord. XI of 2002) was repealed and the Entry Tax Act was enacted. As per Section 3 of the said Act, an Entry Tax was levied on the entry of goods into a local area from outside the State of Maharashtra for use or sale or consumption therein. The said Entry Tax was levied only on goods that were specified in the Schedule to the Entry Tax Act. According to the petitioner, there was no residual entry in the Schedule to the Entry Tax Act. 6. It is further case of the petitioner that natural gas was not mentioned in the Schedule as enacted in 2003. The petitioner did not notice that vide Mah. Act No.8 of 2012 dated 25.04.2012 and with effect from 01.05.2012, Entry 16 namely Natural Gas was added into the Schedule of the Entry Tax Act. As per the provisions of Section 6 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment Order dated 26.12.2017 a tax demand of ₹ 10,44,54,708/-, interest demand of ₹ 7,09,06,928/- and a penalty demand of ₹ 10,44,74,708/-, totaling ₹ 27,98,36,344/- was imposed on the petitioner. After adjustment of the amounts already paid by the petitioner, the amount held to be payable by the petitioner was to the extent of ₹ 24,34,11,956/- . 10. The petitioner filed an Appeal against the said Assessment Order dated 26.12.2017. Section 26(6A)(c) of the MVAT Act provides for pre-deposit of 10% of the tax disputed by the appellant. 11. The respondents imposed a tax demand of ₹ 10,44,54,708/- on the petitioner. The petitioner entirely disputes the tax demand imposed. However, during the course of the investigation, the petitioner was forced to make a payment of ₹ 3,64,24,388/- (i.e. ₹ 2,32,37,249/- towards tax and ₹ 1,31,87,139/- towards interest). 12. At the time of filing of the Appeal against the Assessment Order the petitioner therefore was of the view that it was liable to pre-deposit 10% of the amount of ₹ 10,44,54,708/-. Given that the petitioner had already deposited an amount of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Senior Counsel placed reliance on the decision of the Madras High Court in the case of E.I.D. Parry (India) Limited Vs. Assistant Commissioner (CT), Central Assessment Circle-I and Others reported in 2002 (126) STC 449. The Madras High Court held that payment made under protest disputing the liability of tax cannot be regarded as acceptance of the tax liability. 17. Learned counsel for the respondents on the other hand argued in support of the impugned clarification and contended that as the amount of ₹ 3.64 Crores has been paid before the Assessment Order is passed and which is also disclosed in returns, the same cannot be considered for the purpose of computing the 10% mandatory pre-payment for appeals, in accordance with Section 26 (6A) of MVAT Act. The undisputed facts are that total tax assessed is ₹ 10,44,54,708/- and that prior to the order of assessment, an amount of ₹ 2,32,37,249/- was paid by the petitioner under protest. It is therefore urged that having paid the amount of ₹ 3.64 Crores under protest, since this amount is paid before the Assessment Order is made, the respondents are justified in insisting for a pre-deposit on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... import of Natural Gas into Maharashtra during the period from 01/04/2013 to 31/03/2014 has been determined by me [Dy. Commissioner of State Tax (E-627), Mumbai.] under section 6 of the Maharashtra Tax on the Entry of Goods into Local Areas Act, 2002 (Mah. Act IV of 2003). 2. The total amount of ₹ 243411956/- should be paid into Government Treasury within 30 days from the date of service of demand notice. 3. If you do not pay the amount by the date specified above, the amount shall be recoverable as an arrears of land revenue. 4. If the amount is not paid without reasonable cause by the specified date, you shall also be liable to penalty under the said Act. 5. Any appeal against the order must be presented to the Appellate Authority in the manner laid down in section 6 of the said Act. Deputy Commissioner of State Tax (E-627) LTU-3, Mumbai 20. A perusal of the writ petition and particularly para 18 onwards reveals that the petitioner may raise an issue of interpretation of section 26(6A) of the MVAT Act, but in para 23 of the petition, the petitioner has rightly understood the matter to mean tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidence or produce books of accounts, registers or other documents at a certain place and time, intentionally omits to attend or produce the books of accounts, registers or documents at the place and time, the Tribunal or, as the case may be, the Commissioner, may impose on him such fine not exceeding five thousand rupees as it or he thinks fit; and the fine so levied may be recovered in the manner provided in this Act for recovery of arrears of tax: Provided that, before imposing any such fine, the person concerned shall be given a reasonable opportunity of being heard. (4) When any documents are produced by a person or dealer on whom the summons was issued by the commissioner and the Commissioner is of the opinion that such dealer or any other dealer has evaded or is attempting to evade the payment of any tax due from him and the documents produced by such dealer or person are necessary for establishing the case against such dealer, the Commissioner may, for reasons to be recorded in writing, impound the documents and shall grant a receipt for the same and retain the same for so long as may be necessary in connection with the proceedings under this Act or fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an appeal against a separate order imposing only penalty, deposit of an amount, as directed by the appellate authority, which shall not in any case, exceed 10 per cent of the amount of penalty, disputed by appellant : 24. Chapter IV is titled as REGISTRATION and then follows Chapter V. The title of Chapter V is extremely relevant. It is titled as RETURNS AND ASSESSMENT, ETC. Therein appear sections 20, 22 and 23 to 25 so also sections 26 to 28. Therefore, when there is an assessment under section 23 and that assessment has to be carried out in the manner set out in that provision and an order is to follow, then, naturally, that order of assessment is capable of being rectified and reviewed. Equally, it is that which is subjected to appeal. Therefore, an appeal under sub-section (1) of section 26 lies from every order except an order mentioned in sub-section (2) of section 26 and sub-section (2) of section 85. In other words, an appeal from every order passed under the MVAT Act or Rules or notification shall lie and what section 26 with its sub-sections tells us is that there is a finality attached to the orders in appeal by the Tribunal. The powers of the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section (6A) of section 26 is interpreted in the light of the earlier provisions of the act and particularly Chapters I to VII, it is clear that there has to be a proof of payment of the aggregate of the amounts as set out in clauses (a) to (d) of sub-section (6A) of section 26 of the MVAT Act depending upon the nature of the orders challenged in appeal. It is only then the appeals can be filed and not otherwise. To then hold that an amount which was paid under protest at the time of investigation and assessment to tax, but before an order of assessment or before completion of assessment can be construed as payment in terms of sub-section (6A) of section 26 of the MVAT Act or compliance of sub-section (6A) of section 26, would be doing violence to the plain language of the Act. 26. In the present case, the appeal is against an order. That order is an order passed under section 23. If it is that order which is appealable, then, all the sub-sections of section 23 and the assessment proceedings cannot be lost sight of. If already some amounts are paid, albeit under protest, they would be adjusted against the total tax liability and the demand to follow. The order, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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