1. ASSESSMENT
Hypothetical determination of turnover and procedural lapses in assessment – such assessments cannot be sustained and needed to be considered afresh for the entire year. Accordingly, the matters remitted back.
Kahan Chand & Sons Agencies Pvt. Ltd. v. AO, Shimla (2015) 52 PHT 201 (HPTT)
2. CONDONATION OF DELAY
There was a delay of 907 days in filing the appeal to the Tribunal because of wrong communication of the order of dismissal by Appellate Authority. Instead of communicating at the address given in memo of appeal, communication was sent to the branch of the appellant. Even on personally writing the letters, status of appeal was not communicated. On hearing the appellant, High Court condoned the delay, holding that it was well settled that a party should not be condemned unheard and the case should not be rejected on technical grounds, rather should be decided on merit unless delay is attributable to gross negligence of a party.
B.K. Steels v. State of Punjab And Anr. (2015) 52 PHT 210 (P&H)
3. CRIMINAL PROSECUTION
Prosecution story, in brief, was that on 16-12-2009 vehicle bearing No. PB-10-EC-1520 owned by petitioner was apprehended. It was found that the said vehicle was loaded with ‘Seera’ (mollases) without any bill or payment of tax. Counsel for the petitioner submitted that the petitioner has already deposited the penalty as imposed u/s. 56(c) of the PVAT Act, 2005. Thereafter, the vehicle of the petitioner was released along with goods. Hence, he pleaded that petitioners could not be criminally prosecuted qua the same offense. The HC after hearing allowed the petition and FIR No. 309 filed u/s. 420 of IPC was quashed.
Manish Kumar and Anr. v. State of Punjab (2015) 52 PHT 257 (P&H)
4. EX PARTE ASSESSMENT ORDER
Filing application before the West Bengal Taxation Tribunal against the ex parte assessment order. Plea that mandatory provision as contained in section 42 of the WBVAT Act, 2003 not followed while passing ex parte assessment order. Whether ex parte assessment order could be quashed? The Tribunal held in the negative because revisional application could not be entertained in view of the provision contained in Section 8(3) of the West Bengal Taxation Tribunal Act, 1987 r/w sections 32, 33, 42, 46 of the WBVAT Act, 2003. The Appellate Tribunal held that remedial measures available under the provisions of the Act were quite adequate and it shall not caused any undue hardship to the applicant. No substantial question of law relating to the interpretation of the Constitution of India or the specified State Act or Rules were involved either. Thus, the petitioner not having availed of remedial measures provided in the Act, the revisional application could not be entertained.
MMU Metaliks Udyog (P) Ltd. v. STO, Strand Road Charge (2015) 66 STA (Part-4) P-197 (WBTT)
5. FORGED RECEIPT REGARDING PAYMENT OF VAT
Petitioner dealing in electrical goods forged a receipt in Form 38, along with forged rubber stamp of the Authority to show that the transaction is genuine and thus usurped taxation amount of Rs. 16,230. FIR lodged against the petitioner. Petitioner applied for anticipatory bail, which was dismissed, keeping in view the seriousness of the allegations and to reach in the depth of the entire offence. The petitioner through their advocates contended that he had paid the VAT amount and it is only a nominal amount of Rs. 8,096/-. This was opposed by the State. In the circumstances, the application for anticipatory bail was rejected by the High Court.
Manoj Kumar Kansal v. State of Haryana (2015) 52 PHT 256 (P&H)
6. INTERPRETATION OF ENTRIES
A. Processed vegetables and fruits including fruit jams, pickle, fruits squash, paste, fruit drink and fruit juice covered by Entry-3 of the 3rd Schedule to the Karnataka VAT Act was under the consideration of the HC. In this context, a question arose whether it will include (a) Vegit – Aloo Harabara Kebab, (b) Vegit – Aloo Veg. Cutlet, (c) Vegit – Aloo Yummy Cheese Balls, (d) Vegit – Aloo Mazedar Bonda and (e) Vegit – Aloo Jatpat Tikki, which were generally known as vegit – snack mix. The Karnataka HC after going through exhaustive case laws held that no ordinary person treated these snack mixes as ‘processed vegetables’, though they contain 60% to 85% dehydrated vegetables. While construing the provisions relating to commodity classification, the understanding of the commodity in its popular and commercial sense was to be applied. Accordingly, the Division Bench has set-aside the order passed by the single Judge and confirmed the order passed by the Commissioner confirming the commodities as listed in (a) to (e) above would fall under residuary entry and not under Entry-3 of the 3rd Schedule of the said Act. Accordingly, the appeal of the State was allowed.
State of Karnataka And Anr. v. Merino Industries Ltd. (2015) 27 STJ 573 (Kar)
B. Computer and its parts and accessories – Computer servers, Storage and tape library, Network equipments (Routers, Switches), Workstation (Desktop), Printers, DCU and Connectors, Modems, Spot billing machines, Kiosk machines and Software were covered in computer and its parts and accessories, and, therefore, were exempt from Entry tax in Entry 8 of NTF No. 24 dt. 2-4-2007. But, UPS and battery, IP PBX and Phones, Workstation PC (UPS Table and Chairs) and Computer racks, Cables and Connectors were not covered in computer parts and accessories and therefore were liable for entry tax at 1%.
Reliance Infrastructure Ltd., Korba v. C.C.T. (2015) 27 STJ 611 (CG)
C. Pentasol S-10 (Monolithic & Ramming Mass) – it is a Refractory material / item – it was not covered in Entry 27(b) of Schedule-II of CG Entry Tax Act, which was relating to Bricks excluding fly ash bricks, but including fire bricks and fire clay. There being no any entry for Pentasol S-10 (Monolithic & Ramming Mass) in Schedule-II of the Entry Tax Act, it was exempt from Entry tax. This decision was arrived at after referring to Tata Steel Ltd. v. State of Odisha (2013) 57 VST 484 (Ori)
However, the Journal’s Editor note stated that before Pentasol S-10 (Monolithic & Ramming Mass) was treated as exempt from entry tax, it was necessary to examine whether it could be covered under Residuary Entry of Schedule-II, or whether it could be covered in Schedule-III of the Entry Tax Act.
RHI India Pvt. Ltd., Raigarh v. C.C.T., CG (2015) 27 STJ 615 (CG)
7. INTER-STATE SALE
Cereals and Pulses were exempted from tax under the M.P.C.T. Act, vide Notification dt. 10-7-1999 subject to the condition that the goods manufactured from the States were sold in the State or in the course of inter-State trade or in the course of export. The assessee in the present case transferred the ‘Dalhan’ (pulses) to agent outside the State who sold the same in that State. The only question raised for determination before the HC was whether the exemption was available to the assessee for the period in question on Dalhan sold outside the State through agents. The MP High Court allowed writ petition of the assessee on the ground that the assessee sold Dalhan outside the State through the agents and therefore, it was covered in inter-State sale and the assessee is entitled for benefit of notification dt. 10-7-1999. However, on appeal by the State before the Apex Court, the Apex Court set-aside the judgment of the MP High Court by holding that the assessee never raised the plea that he made inter-State sale to the agents. Though, the assessee referred certain documents to suggest that the inter-State sale was made to the agents, who in turn sold the Dalhan in the said State. But, in absence of any plea taken before the lower authorities and the High Court, the Supreme Court was not inclined to decide the said question in the appeal. Therefore, in this appeal the only question before the Supreme Court was whether sale of goods outside the State through agents could be treated as inter-State sale. Considering the scheme of Section 3 of the CST Act, the Supreme Court set-aside all the impugned judgments and lower orders and allowed the appeal of the State.
State of MP And Ors. v. S.K. Industries (2015) 13 STD 190 (SC)
8. NATURAL JUSTICE
Denial of proper chance of being heard by all the authorities below including Trial Judge was the question required to be dealt with in the appeal as well as writ petition by the Calcutta High Court. In the circumstances, the HC held that appeal could be disposed of merely on the ground of violation of natural justice and the order of the trial judge is set-aside. It was further held that the matter shall be resolved by the revising authority within 1 month from the date of communication of the Order. If no steps are taken in terms of the Order on receipt of those original documents, this order passed by us would stand recalled.
Lux Hosiery Industries Ltd. v. ACCT and Ors. 2015 66 STA (Part-4) Page 183 (Cal.)
9. PRE-DEPOSIT OF TAX U/S. 62(5) OF THE PVAT ACT, 2005
Claim of the appellant was that demand was created against him only for the reasons that the input credit of tax (ITC) claimed by him was rejected on the ground that his selling dealers had not deposited the tax so collected in the Govt. Treasury. Appeals of the selling dealers before the First Appellate Authority relate to cancellation of their registration, therefore, present appeals could not be clubbed with the cases pending before the Authority. However, the cases could be send back to the Assessing Authority (deciding the assessments to the selling dealers) in order to make out these were the bogus sales, there was connivance or collusion between the appellant and the purchasing dealers in order to avoid tax liability and also to recover the tax from the persons actually liable to pay the same. Thereupon, the HC held the appeal is accepted and impugned orders was set-aside and the case was remitted back to the assessing authority to frame the assessment along with the cases of assessment of the selling dealers. However, if the selling dealers did not deposit the tax, then, the purchasing dealer would pay the tax.
Friends High Tech Industries, Amritsar and Ors. v. State of Punjab (2015) 52 PHT 271 (PVT)
10. RECTIFICATION ORDER
Rectification order was passed under wrong section whether void, was the matter for the consideration of Punjab VAT Tribunal. The Tribunal after going through the original assessment record held that mere mentioning of the wrong section did not negate the Order so passed. The legality of it could be seen later as it was the subject-matter of merit. The condition of pre-deposit was to be complied with at this stage. Accordingly, Rectification Appln. was rejected.
Malwa Industries Ltd. v. State of Punjab (2015) 52 PHT 194 (PVT)
D. H. Joshi