1997 (9) TMI 577 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of notice for registration and demand of security money under Assam General Sales Tax Act, 1993.
2. Legality of levy and realization of sales tax on exempted goods.
3. Constitutionality of impugned notice under articles 14, 19(1)(g), 265, 300-A, and 301 of the Constitution of India.

Detailed Analysis:
1. The writ petition challenged a notice issued by the Senior Superintendent of Taxes, Tezpur, directing the petitioner-firm to apply for registration or show cause for not being registered under section 12(1) of the Assam General Sales Tax Act, 1993. The petitioner, engaged in selling cement, claimed exemption based on previous litigation involving Vinay Cement. The petitioner argued that the notice was illegal and without jurisdiction. The High Court noted that the petitioner failed to register under the new Act despite the demand, leading to the issuance of the impugned notice. The legality and validity of the notice were the primary issues in this proceeding.

2. The petitioner contended that the levy and realization of sales tax on cement purchased from an industrial unit exempted from sales tax was illegal and violated constitutional provisions. The High Court observed that the petitioner was found liable for registration under the Act from July 7, 1993, and failed to register under section 11, contravening the Act. The petitioner, despite claiming a bona fide belief in the exemption of Vinay Cement, accepted the offense and agreed to pay composition money. The court upheld the actions taken by the tax authorities regarding registration and security deposit, dismissing the petitioner's arguments against the levy of sales tax on previously exempted goods.

3. The constitutional validity of the impugned notice was challenged under articles 14, 19(1)(g), 265, 300-A, and 301 of the Constitution of India. The respondents argued that the writ petition had become infructuous and should be dismissed. The court analyzed the legislative provisions under the Act, emphasizing the dealer's liability to pay tax and the authority granted to tax authorities for effective tax collection. The court rejected the petitioner's claims of discrimination and violation of constitutional rights, stating that reasonable classification and legislative powers were upheld. The writ petition was ultimately dismissed, with no order as to costs, concluding the legal proceedings.