1986 (12) TMI 359 - HC - VAT and Sales Tax

Summary

Issues:
1. Acceptance of form C by the appellate authority under the Orissa Sales Tax Act, 1947 and the Central Sales Tax Act, 1956.

Analysis:
The judgment by the Orissa High Court pertains to two references concerning a dealer who is a co-operative society under the Orissa Co-operative Societies Act, 1962. The dealer engaged in the purchase and sale of goods and sought assessment at a concessional rate of tax for the years 1974-75 and 1975-76. The issue revolved around the acceptance of form C by the appellate authority, specifically in relation to the provisions of section 8(1) of the Act which provides for concessional rates for inter-State trade transactions to registered dealers. However, section 8(4) outlines exceptions to this provision, requiring specific declarations to be furnished. The dealer faced challenges in providing form C declarations before the assessing officer, leading to the rejection of its claim for concessional tax rates. Appeals were made to the Assistant Commissioner, who refused to entertain the declarations citing rule 12(7) of the Central Sales Tax Rules, 1957. These decisions were upheld in the second appeal before the Member, Additional Sales Tax Tribunal.

The Court delved into the statutory provisions, emphasizing the significance of form C declarations for availing concessional tax rates in inter-State transactions. It highlighted the requirements under section 8(4) and rule 12(7) for timely submission of these declarations. The Court noted that the dealer failed to provide valid reasons or seek adjournment before the assessing officer to furnish form C declarations, which impacted the assessment process. Despite later submitting some declarations before the Assistant Commissioner, the appellate authority's jurisdiction to consider such submissions was questioned.

A crucial aspect of the judgment involved a legal precedent set by the Calcutta High Court, which allowed dealers to produce and rely on declaration forms at the appellate stages. However, a Division Bench of the Orissa High Court had previously dissented from this view, emphasizing the importance of submitting such documents before the initial assessment. The Court considered the reasoning behind the dealer's inability to furnish form C declarations timely and concluded that sufficient explanations were provided to the appellate authorities. Consequently, the Court held that the appellate authority should have accepted the declarations submitted before it, in line with the dealer's justifications.

In light of the preceding analysis and legal principles, the Orissa High Court ruled in favor of the dealer, asserting that the Member, Additional Sales Tax Tribunal erred in disregarding the form C declarations without considering the dealer's explanation for the delay. The references were answered in favor of the assessee, with no costs awarded. The Chief Justice and the Judge concurred with the decision, thereby resolving the matter in favor of the dealer.