A. Appeal against a non-speaking and ex parte order was allowed and case was remanded with the direction to examine its afresh after giving opportunity of hearing to the appellant and to pass a speaking order, within two months from receipt of appeal order. At the same time, the appellant was directed to place any evidence he wishes to produce before the AO. But, the remand case was not decided even after seven years; no proceedings were initiated nor any notice was served on the petitioner.
2. The petitioner filed a writ petition for refund of amount deposited for filing of appeal. The P&H HC allowed the petition and held that the appeal having been allowed and order of penalty having been set-aside, the petitioner was entitled for refund of ` 88,000 deposited by him for filing appeal against the penalty order, and mere pendency of remand case did not entitle the revenue to retain the amount deposited by the petitioner. The HC further held that in the remand proceedings, the petitioner may also raise a plea of interest on delayed refund of deposit.
Surya Synthetics v. State of Punjab (2014) 25 STJ 86 (P&H)
B. Appeals decided on merits on ex parte orders due to non-appearance of the appellant or his counsel on the date of hearing. Earlier also, four dates of hearing were given, and thus, the Appellate Authority assumed that the appellant did not want to pursue his appeals. In the Second Appeal, the appellant raised the only ground of passing of ex parte orders of Appellate Authority. The Appellate Board remanded the matter to the assessing authority with a specific direction to examine nature of transactions.
Mangalam Gasses Ltd., Gwalior v. Commissioner, CT, M.P. (MPBD) (2014) 25 STJ Page 588.
C. If conditions for a best judgment assessment were present, the assessing authority can had recourse to best judgment, but it would not make on speculative or fanciful grounds but on reasonable guess, since the best judgment assessment did not negate the exercise of judgment on the part of the officer. A tax officer, who framed a best judgment assessment, should have make an intelligent well-grounded estimate rather than launch upon pure surmises.
S. M. Hasan, STO; Jhansi v. New Gramophone House (2014) 25 STJ 288 (SC)
A. Activities of the appellant providing telecommunication services to its customers was covered in “business”. The definition of “business” u/s 2(c) of MPCT Act, was very wide and expansive as it started with the word “includes”. For being covered in the definition of business, it is not necessary that there should be sales and purchases.
B.T.A. Cellcom Ltd., Indore v. C.C.T., M.P., (2014) 25 STJ 531 (MPBD)
B. Sale of prospectus and application forms by petitioner – Manipal University, which was registered as a dealer for sale of medicines and other equipments in the hospital and medical shops attached to their medical colleges. Petitioner contended that they were not engaged in the activity of sale of prospectus and application forms so as to attract levy of VAT. The Karnataka HC after considering receipts from sale of prospectus and application forms held that it could not be said that there was no profit motive as claimed by the petitioner. Merely because the university was established for imparting education did not mean that it was not indulged in the business. Their intention to make profit was clear from the facts and figures placed on record. That apart, once they were registered as a dealer u/s. 22 of the Karnataka VAT Act, the total turnover would mean aggregate turnover of the dealer in all goods whether or not liable to tax. The petitioner therefore could not take a stand that they were registered only for sale of medicine and equipments in the hospital and not for sale of prospectus and application forms. Accordingly, its liability to pay tax was fastened by the HC.
Manipal University v. State of Karnataka (2014) 25 STJ 94 (Kar.)
3. Check Post Penalty
Whether the goods were UPS or Inverters? It was for the assessing authority to determine, and the check post officer had no jurisdiction to delve upon into the issue while levying the check post penalty. The nature of the transaction could only be determined by the assessing authority u/s 51.
State of Punjab v. Genus Overseas Electronics Ltd. (2014) 25 STJ 233 (P&H)
4. Composition Tax
A. The appellant once having exercised the option under the composition scheme could not be permitted to turn around and rescind from his liability, merely on the ground that he had no turnover due to losses or had not done any manufacturing activity during the relevant year. In other words, the appellant once having opted for composition could not request the Assessing Authority for regular assessment. In the instant case, the appellant had voluntarily offered to pay tax at the compounded rates, which was accepted by the Assessing Authority. Thereafter, in the middle of the year the appellant could not withdraw the option for payment of tax at the compounded rates.
Liquors v. Dy. Commissioner of ST (2014) 25 STJ 273 (SC)
B. Whether additional tax u/s. 5-D of the Kerala General Sales Tax Act was leviable in case of Composition u/s. 7 of the Act. Supreme Court held that u/s. 7(1), the non obstante clause “notwithstanding anything contained in subsection 1 of section 5” had been used to give provisions of section 7(1) overriding effect over provisions of section 5(1). The additional tax could therefore be levied on a dealer who was liable to pay tax u/ss. 5 and 5-A at a particular rate. In the instant case, the dealer was not being taxed u/s. 5 or 5-A, but was paying tax at the compounded rate u/s. 7, and, therefore, he was not liable to pay additional tax u/s. 5-D.
Bhima Jewellery v. AC (Assessment), Kerala 25 STJ (2014) 1 (SC)
5. Condonation of Delay
A huge delay of 1205 days in preferring the appeal by the revenue took place. Except mentioning various dates and throwing burden upon the office of the Govt. Pleader the delay was not properly and sufficiently explained to the Court. The Dept. miserably failed to give any acceptable and cogent reason for such a delay. In the case of Lanka Venkatewarlu AIR 2011 SC 1199, Supreme Court held that while considering application for condonation of delay u/s. 5 of the Limitation Act, the courts did not enjoy unlimited and unbridled discretionary powers. All discretionary powers, especially judicial powers, had to be exercised within reasonable bounds, known to the law. The SC further observed that the concepts such as liberal approach, justice oriented approach, substantial justice could not be employed to jettison the substantial law of limitation especially, in cases where the court concludes that there was no justification for the delay. Applying the said decision of the SC, the High Court refused to condone the delay.
State of Gujarat v. Swet Zink Ltd. (2014) 25 STJ 65 (Guj.)
B. Non-submission of ‘H’ forms in the assessment for 2004-05 and 2005-06. Revisions filed in CST case rejected on the ground that revisions should have been filed in State case. Thereafter, revisions were filed in State case with delay of two years and nine months in 2004-05 and one year and 10 months in 2005-06. Request made for condonation of delay was not accepted and both the revisions were rejected. M.P. High Court held that revisional authority should have taken a more liberal view and the delay having been reasonably explained, it was a fit case where delay could have been condoned and revision petition could have been decided on merits. Accordingly, directions for such action were given.
Venkatesh Food Industries v. State of M.P. (2014) 25 STJ 137 (M.P.)
C. It was not necessary to discuss each and every judgment cited before us for the simple reason that section 5 of the Limitation Act, 1963 did not lay down any standard or objective test. The test of ‘sufficient cause’ was purely an individualistic test. It was not an objective test. Therefore, no two cases can be treated alike. The statute of limitation had left the concept of ‘sufficient cause’ delightfully undefined, thereby it left to the court a well-intentioned discretion to decide the individual cases whether circumstances existed establishing sufficient cause. There were no categories of sufficient cause. The categories of sufficient cause were never exhausted. Each case spelled out a unique experience to be dealt with by the court as such.
Indian Oil Corporation Ltd. v. State of Haryana (2014) 49 PHT 251 (P&H)
6. Interpretation of Entries
A. Glue trap – used to trap the mouse. Held it was covered in Entry 30 of Part II of Schedule II, CG VAT Act, which pertained to Rodenticides and was liable to tax at 5%.
Shreshta Home Care, Raipur (CCT, CG) 2014 25 STJ 373
B. Dumper, held as covered in motor vehicles and therefore was liable for entry tax under Entry 1 of Part-1 of the Schedule to the Gujarat Entry Tax Act, 2001.
State of Gujarat v. Dhorajia Construction Co., Gujarat (2014) 25 STJ 503 (Guj.).
C. Component of machinery for printing industry. P.S. Aluminium Litho Graphic Plate which was used in off-set printing. Though it may be a component of printing material but it was not a component of printing machinery. Therefore, it was not covered in Entry 1 (XVII) of list of goods specified in Notification No. 45 dated 28-4-2006 in terms of Entry II / II / 27 of C.G. VAT Act. Held, it is covered under residuary entry as held in the case of Mittal Printing Ink, Raipur (2007) 11 STJ 70 (CCT, CG), and was liable to tax at 14%.
Technova Imaging System (P) Ltd., Panvel (CCT, CG) (2014) 25 STJ 621.
D. Entry Tax Act and Sales Tax Act are two different Acts enacted under different entries of the Constitution, and, therefore, entries in the Schedule of Sales Tax Act cannot be applied for deciding rate of entry tax.
Parle International Pvt. Ltd., Indore v. CCT, M.P. (M.P.-Bd) (2014) 25 STJ 187.
7. Interpretation of Statute
Amendment in the statute clarificatory/ declaratory amendment could be treated as retrospective even if there is no specific mention about the same in the amended provision.
Dashmesh Oil Cake Industries v. CCT, M.P. (2015) 26 STJ 58 (M.P.-Bd)
8. Situs of Sale
In respect of inter-State trade or commerce, the situs of sale or purchase is wholly immaterial. State legislature could not by law, treat sales outside the State and sales in the course of import as ‘sales’ within the State by fixing the situs of sales within its State in the definition of ‘sale’ as it was within the exclusive domain of Parliament to fix the location of sale by creating legal fiction or otherwise.
2. Where situs has not been fixed or covered by any legal fiction created by appropriate legislature, the location of sale would be a place, where property in goods passes. It was the passing of property within the State that was intended to be fastened for the purpose of determining whether the sale was inside or outside the State. To quote, where a party had entered into a formal contract and the goods were available for delivery irrespective of the place where they were located, the situs of such sale would be where the property in goods passes, namely, where the contract was entered into.
Commissioner of Trade Tax v. M/s. Rotomack Finance Pvt. Ltd. (2014) 49 PHT 507 (All)
9. Sufficient Cause
A. The expression ‘sufficient cause’ should receive liberal construction. The court has to exercise the discretion on the facts of each case keeping in mind that in construing the said expression, the principle of advancing substantial justice was of prime importance.
Nipa Chemicals Ltd. v. State of Haryana (2014) 49 PHT 119 (HTT)
B. There did not exist any exhaustive list constituting sufficient cause. The question regarding whether there was sufficient cause or not, depended upon each case and primarily was a question of fact to be considered taking into totality of events which had taken place in a particular case.
Kishori Lal & Sons v. State of Haryana (2014) 49 PHT 201 (HTT).
10. Tax Recovery from a Director of Company
Liability of Director of Private Company in liquidation to pay tax was always a matter of serious consideration. Opportunity of hearing is a hallmark and essential aspect before proceedings to recover the arrears of tax from Director of a Company.
P. K. Rajgarhiya v. State of Haryana (2014) 49 PHT 464 (P&H)
11. Time-Barred Assessment Notice
It is a settled law that if the assessment proceedings were initiated after the limitation period, the same became vitiated and the orders so passed were without jurisdiction. Since, the requirement of section 15(2) of the Haryana VAT Act had not been fulfilled, rather violated in this case, the impugned orders, therefore, became legally unsustainable and there was no other alternative except to quash the same.
Rukmini Polytubes (P) Ltd. v. State of Haryana (2014) 49 PHT 527 (HTT)
12. Tribunal – Its powers and functions
Five Members Bench of Haryana Tax Tribunal proceeded to abdicate its powers on an erroneous premise that it had no jurisdiction to opine whether an Order passed by the High Court is no longer good law in view of the subsequent judgments of the Hon’ble Supreme Court. The Tribunal was apparently unaware that law laid down by the Supreme Court could not be ignored merely because a Division Bench of a High Court may or may not have had taken a contrary view. The Supreme Court of India sits at the pinnacle of the system of administration of justice, and its orders prevail over all other orders. A Tribunal, exercising judicial or quasijudicial powers could not refuse to consider the judgments of the Hon’ble Supreme Court by holding that it was for the HC to decide whether its opinion subsists or not.
J.S. Polymers India (P) Ltd. v. State of Haryana (2014) 49 PHT 462 (P&H)
13. Writ Petition vis-a-vis Rectification Order
The Punjab & Haryana High Court held that a writ petition against the Rectification Order was not maintainable.
Larsen & Toubro Ltd. v. State of Punjab (2014) 49 PHT 153 (P&H)
D. H. Joshi