1975 (3) TMI 125 - HC - VAT and Sales Tax

Summary

Issues:
1. Claim of exemption on depot sales turnover.
2. Inclusion of excise duty in taxable turnover.
3. Exercise of suo motu powers by the Board of Revenue under section 34 of the Tamil Nadu General Sales Tax Act.

Analysis:

1. Claim of Exemption on Depot Sales Turnover:
The assessee, a textile mill, claimed exemption on a turnover of Rs. 19,33,380.94, contending it as depot sales. The Appellate Assistant Commissioner rejected this claim, determining the turnover to be inter-State sales liable to sales tax. The assessee did not appeal this decision to the Tribunal. The Board of Revenue, considering the retrospective deletion of rule 6(f), rejected the claim for exemption, stating the assessee failed to appeal to the Tribunal despite contending the turnover as depot sales. The Court upheld the Board's decision, emphasizing that the assessee's failure to appeal and the retrospective repeal of the rule justified the rejection of the claim.

2. Inclusion of Excise Duty in Taxable Turnover:
The Appellate Assistant Commissioner allowed the deduction of excise duty paid by the assessee, relying on a Supreme Court decision and relevant tax rules. However, the Board of Revenue, following the retrospective deletion of rule 6(f), initiated proceedings to include excise duty in the taxable turnover. The Court referenced a previous judgment to affirm that, despite the retrospective effect of the rule's deletion, the excise duty was correctly included in the taxable turnover. The Court upheld the Board's decision, stating it was in accordance with the law.

3. Exercise of Suo Motu Powers by the Board of Revenue:
The appellant contended that the Board of Revenue should have exercised its suo motu powers under section 34 of the Act to reconsider the inclusion of the disputed turnover in the taxable turnover. The Court acknowledged the Board's discretion to invoke these powers but emphasized that such discretion must be exercised judicially. In this case, the Court found that the Board did not act arbitrarily or capriciously in rejecting the appellant's claim. The Court noted that the appellant did not appeal the original decision, indicating satisfaction with the Appellate Assistant Commissioner's order. Consequently, the Court upheld the Board's decision, finding no grounds to interfere.

In conclusion, the Court dismissed the appeal, upholding the decisions of the Board of Revenue regarding the exemption claim, inclusion of excise duty, and the exercise of suo motu powers. The appellant was ordered to pay costs and counsel fees.