1998 (1) TMI 498 - HC - VAT and Sales Tax

Summary

Issues:
1. Dispute over assessment orders for two different periods.
2. Jurisdiction to tax branch transfers and collect tax.
3. Validity of orders of assessment by Sales Tax Tribunal.
4. Legislative competence to impose tax on works contracts.
5. Constitutional validity of actions taken by sales tax authorities.

Analysis:
1. The petitioner sought relief to prevent the taxation of branch transfers and quash assessment orders. The dispute related to orders of assessment for two periods, with similar prayers made in both cases. The Orissa Sales Tax Tribunal's judgments were challenged through writ petitions, seeking to set aside the orders and prevent further jurisdiction to tax branch transfers.

2. The judgments referred to orders by the Sales Tax Tribunal setting aside the assessing officer's orders and directing reassessment. The petitioner challenged the rejection of applications for reference, arguing that the Tribunal lacked jurisdiction. The points of reference included the nature of contracts and whether stock transfers constituted inter-State sales.

3. The petitioner argued that the State lacked legislative competence to tax certain types of contracts under the Central Sales Tax Act. Citing legal precedents, the petitioner contended that without proper legislative empowerment, the State's actions were ultra vires. The petitioner emphasized the need for constitutional scrutiny of the sales tax authorities' actions.

4. The respondent contended that the petitioner, having pursued appeals and references, was not entitled to seek writ relief. The respondent argued that previous judgments had upheld the State's power to levy assessments on works contracts. The respondent highlighted legal challenges in previous cases and maintained that the State's assessment orders were valid.

5. The Court considered the legislative framework and legal precedents regarding the taxation of works contracts. Despite the petitioner's argument on constitutional grounds, the Court found no merit in challenging the actions of the sales tax authorities. The Court upheld the State's power to levy assessments and dismissed the writ petitions, allowing the authorities to proceed with the pending reference cases.

In conclusion, the Court dismissed the writ petitions, finding no constitutional infirmity in the actions of the sales tax authorities. The Court upheld the State's power to levy assessments on works contracts and allowed the authorities to continue with the pending reference cases.