TMI Blog2019 (12) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 6(2) of the Act and also file the monthly return in Form 'L' as prescribed under the Rules. In the impugned Assessment Order passed, the Assessing Authority himself has admitted this position of compliance of the substantial condition by the Assessee - there is no dispute that the Assessee also filed monthly returns in terms of Section 6 in prescribed Form 'L' and not in Form 'I' applicable to the payment of regular tax under Section 5 of the Act. The terms of Sub-section (2) to Section 6, which employs the terms may apply to the assessing authority prima facie indicates that the said requirement is of a directory nature and not mandatory. The words used are not shall but may . The words may' usually would render compliance of the provision directory and not mandatory - Therefore, the said requirement of exercise of option by way of application cannot be said to be a condition precedent for availing the benefit of payment of compounded rate of tax under Section 6 of the Act. The substantial compliance with the provisions of the Act in the form of not making any purchases from outside the State and payment of tax under month ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us petition is closed. 3. Learned counsel for the Revenue Mr.Shafiq submitted that the specific provision in Section 6(2) of the Act requires the dealer, who executes the Works Contract, to apply to the assessing authority for opting to pay the tax at compounded rate as prescribed under Section 6 of the Act as contra distinguished from the payment of regular tax on Works Contract under Section 5 of the Act. He submitted that even though the Assessee had filed the monthly returns in Form 'L', and had not effected any purchase of goods from outside the State of Tamil Nadu, but in the absence of the application filed by the Assessee to his exercise of his option to pay the tax under Compounding Scheme under Section 6 of the Act, the said benefit of composition could not be allowed to the Assessee. 4. Per contra, the learned counsel for the Assessee Mr.P.V.Sudhakar has supported the impugned order and urged that the assessing authority himself had accepted the satisfaction of the condition under Section 6(2) of the Act by the Assessee that the Assessee did not effect any purchase of goods from outside the State and had also filed the monthly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also filed monthly returns in terms of Section 6 in prescribed Form 'L' and not in Form 'I' applicable to the payment of regular tax under Section 5 of the Act. 8. The Honourable Supreme Court, in the case of Commissioner of Central Excise -Vs- Hari Chand Shri Gopal and Others (2011) S.C.C.236 , while dealing with the Excise Laws in similar circumstances, made a fine distinction between 'subtantial compliance' and 'intended use' in the Fiscal Statutes in the following manner. We quote Paragraphs 32 to 34 from the said judgment. DOCTRINE OF SUBSTANTIAL COMPLIANCE AND `INTENDED USE': 32.The doctrine of substantial compliance is a judicial invention, equitable in nature, designed to avoid hardship in cases where a party does all that can reasonably expected of it, but failed or faulted in some minor or inconsequent aspects which cannot be described as the essence or the substance of the requirements. Like the concept of reasonableness , the acceptance or otherwise of a plea of substantial compliance depends upon the facts and circumstances of each case and the purpose and object to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be done but are given with a view to the orderly conduct of business, they may be fulfilled by substantial, if not strict compliance. In other words, a mere attempted compliance may not be sufficient, but actual compliance of those factors which are considered as essential. 9. A similar view was taken by this Court also in the case of GE T D India Ltd -Vs- Commissioner of Central Excise Service Tax in C.M.A.No.2032 of 2019 dated 06.12.2019, wherein it was held as under. 10. We do not find anything in the order of the learned Tribunal, which could deny the benefit of the Composition Scheme to the Assessee and therefore, the order of remand passed by the learned Tribunal on 01.06.2018 directing the Assessee to go for regular assessment instead of Composition Scheme merely because the option was not conveyed to the Department on the part of the Assessee in writing, even though the Revenue had not prescribed any format for the same, could not be a valid ground to deny the benefit to the Assessee. If a previously rendered judgment of the same Tribunal authored by the same Member was brought to the notice of the learned Tribunal by way of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iod and in such manner as may be prescribed. (3) The option exercised under sub-section (1) shall be final for that financial year. (4) A dealer, exercising option under sub-section (1) shall, so long as the option remains in force, not be required to maintain accounts of his business under this Act or the rules made there under except the records in original of the works contract, extent of their execution and payments received or receivable in relation to such works contract, executed or under execution. (5) The dealer, who pays tax under this section, shall not 1[collect any amount by way of tax or purporting to be by way of tax and shall not ] be entitled to input tax credit on the goods purchased by him. Explanation.- For the purpose of this section civil works contract includes civil works of construction of new building, bridge, road, runway, dam or canal including any lining, tiling, painting or decorating which is an inherent part of the new construction and any repair, maintenance, improvement or up gradation of such civil works by means of fixing and laying of all kinds of floor tiles, mosaic t ..... 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