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2002 (2) TMI 1289 - HC - VAT and Sales Tax
Issues Involved:
1. Legality of the assessment order under the Bihar Finance Act and the BET Act. 2. Requirement of filing form ET-IX for exemption from entry tax. 3. Whether the provision of Rule 6 of the Bihar Tax on Entry of Goods into Local Areas Rules, 1993 is mandatory or directory. Issue-wise Detailed Analysis: 1. Legality of the assessment order under the Bihar Finance Act and the BET Act: The petitioner challenged the assessment order passed by the Deputy Commissioner of Commercial Taxes for the assessment years 1993-94, 1994-95, and 1995-96, which determined a total tax liability of Rs. 5,55,865.86 and a penalty of Rs. 1,37,300.90. The assessment was made under section 17(5) of the Bihar Finance Act, 1981 read with section 8 of the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993 (BET Act). The petitioner's claim for exemption from payment of entry tax under the BET Act was rejected on the ground that he was a second buyer and not an importer as defined under the BET Act, and also due to non-filing of form ET-IX as prescribed under Rule 6 of the Bihar Tax on Entry of Goods into Local Areas Rules, 1993. 2. Requirement of filing form ET-IX for exemption from entry tax: The core issue was whether the petitioner, as a subsequent dealer, was required to file form ET-IX to claim exemption from entry tax. According to Rule 6, a dealer claiming exemption must substantiate his claim before the assessing officer by producing purchase bills, invoices, cash memos, and a true and complete declaration in form ET-IX received from the selling dealer. The rule aims to prevent fraud and collusion in attempts to evade tax and to facilitate administrative efficiency. 3. Whether the provision of Rule 6 of the Bihar Tax on Entry of Goods into Local Areas Rules, 1993 is mandatory or directory: The court examined whether the requirement of filing form ET-IX was mandatory or directory. The petitioner argued that the requirement was directory, and the assessing authority should consider other materials produced by the dealer for exemption. The court referred to several Supreme Court judgments, including the cases of State of Orissa v. M.A. Tulloch and Co. Ltd., Kedarnath Jute Manufacturing Co. Ltd. v. Commercial Tax Officer, and Commissioner of Sales Tax v. Prabhudayal Prem Narain, which held that the requirement of furnishing a declaration form for claiming exemption under various Sales Tax Acts was mandatory. The court concluded that the provision of Rule 6 requiring the filing of form ET-IX was mandatory. This mandatory requirement was to ensure that the entry tax was paid at the first point of entry and to prevent double taxation, fraud, and administrative inefficiency. Conclusion: The court dismissed the writ application, holding that the requirement of filing form ET-IX was mandatory for claiming exemption from entry tax. The petitioner was advised to challenge the assessment order on other grounds before the appellate authority if so advised. Judgment Delivered: - The writ application was dismissed. - The petitioner was allowed to challenge the assessment order on other grounds before the appellate authority.
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