1983 (4) TMI 246 - HC - VAT and Sales Tax

Summary

Issues:
- Writ petition filed under Tamil Nadu General Sales Tax Act and Central Sales Tax Act
- Quashing of order by Joint Commercial Tax Officer
- Permission to pay tax under Central Sales Tax Act on a provisional basis
- Declaration of rule 5(1) of Central Sales Tax (Tamil Nadu) Rules as ultra vires
- Assessment under Central Sales Tax Act in relation to general sales tax law of the State
- Interpretation of section 9(2) of Central Sales Tax Act
- Application of Central Sales Tax (Tamil Nadu) Rules
- Effect of rule 11 of Central Sales Tax (Registration and Turnover) Rules, 1957

Analysis:

The judgment involves two writ petitions filed by the assessee under the Tamil Nadu General Sales Tax Act and the Central Sales Tax Act. The first petition seeks to quash the order passed by the Joint Commercial Tax Officer and to direct permission for provisional tax payment under the Central Sales Tax Act based on the annual return submitted. The second petition requests a declaration that rule 5(1) of the Central Sales Tax (Tamil Nadu) Rules is ultra vires. The dispute arose when the assessee, permitted to file annual returns under the Tamil Nadu General Sales Tax Rules, was denied the same privilege for sales under the Central Sales Tax Act due to rule 5(1) requirements for monthly returns submission.

The judgment delves into the interpretation of section 9(2) of the Central Sales Tax Act, which empowers state authorities to assess, collect, and enforce payment of tax under the Act as per the general sales tax law provisions of the State. This provision ensures that assessment procedures, including returns and provisional assessment, align with the State's general sales tax law, as highlighted in the case of Khemka and Co. v. State of Maharashtra [1975] 35 STC 571 (SC). The State Government framed the Central Sales Tax (Tamil Nadu) Rules under the authority granted by the Central Sales Tax Act.

Rule 5(1) of the Central Sales Tax (Tamil Nadu) Rules mandates monthly return submission by registered dealers, which conflicted with the assessee's request for annual return filing. However, the judgment clarifies that the period of turnover for a dealer under the Central Sales Tax Act is determined based on the period for submitting returns under the State's general sales tax law. Since the assessee was allowed to file annual returns under the State law, the requirement to file monthly returns under rule 5(1) was deemed unnecessary.

Consequently, the court quashed the impugned order and directed the Joint Commercial Tax Officer to permit the assessee to file Central sales tax returns annually, in line with the State's general sales tax law filing frequency. The judgment did not find it necessary to address the vires of rule 5(1) due to the established filing practices of the assessee under the State law.