2002 (7) TMI 763 - HC - VAT and Sales Tax

Summary

Issues:
1. Challenge to the constitutional validity of section 47(4A) of the Gujarat Sales Tax Act, 1969.
2. Assessment order dated October 19, 1987, disallowing sales made by the petitioner against form 24-B declarations.
3. Dispute regarding the cancellation of registration of the buyer, M/s. Jalaram Trading Co.

Analysis:
1. The petitioner initially challenged the constitutional validity of section 47(4A) of the Act but later withdrew this challenge. The court decided not to examine this challenge further based on the petitioner's statement.
2. The petitioner contested an assessment order dated October 19, 1987, which disallowed sales made against form 24-B declarations. The petitioner argued that the sales were exempt from tax under section 19(B)(1)(i) and objected to the proposed tax levy. Respondent No. 1 did not consider the objection and passed the assessment order, demanding Rs. 1,01,185.
3. The dispute centered around the cancellation of registration of the buyer, M/s. Jalaram Trading Co. The petitioner argued that the registration was in force until December 1985 due to civil court injunctions, while the respondent authorities claimed it was canceled in November 1983. The court found the respondent's position unjust, noting that the registration cancellation date was unclear to the public. Referring to Rule 11 on cancellation of registration, the court held that the petitioner could not be held liable for tax, penalty, or interest on sales made to the buyer if unaware of the cancellation. The court directed respondent No. 1 to reframe the assessment considering the sales to M/s. Jalaram Trading Co. against form 24-B declarations.

In conclusion, the court allowed the petition, directing a reassessment of the sales to M/s. Jalaram Trading Co. and redetermination of any tax, interest, or penalty payable by the petitioner.