2003 (8) TMI 519 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Maintainability of the appeal under section 9 of the U.P. Sales Tax Act, 1948.
2. Tax liability and classification of goods.
3. Interpretation of "tax due under the Act" and "admitted by the appellant in the return filed by him."
4. Compliance with section 9(1-B)(a) of the U.P. Sales Tax Act.
5. Applicability of Supreme Court judgments on the classification of goods.

Issue-Wise Detailed Analysis:

1. Maintainability of the Appeal:
The primary issue is whether the appeal filed by the dealer-applicant was maintainable under section 9 of the U.P. Sales Tax Act, 1948, given the requirements of clause (1-B) of section 9. The appeal was dismissed by the Deputy Commissioner (Appeals) on the grounds that the dealer failed to comply with the provisions of sub-section (1-B)(a) of section 9, which mandates satisfactory proof of payment of the tax admitted by the appellant in the returns filed or at any stage in any proceedings under the Act.

2. Tax Liability and Classification of Goods:
The dispute pertains to the assessment year 1986-87 regarding inter-State sales. The applicant admitted the sale of pressure cookers, spare parts, and aluminum utensils, acknowledging a tax liability of 4% covered by form C. However, the applicant failed to produce form C for a turnover of Rs. 94,599.23, leading the assessing authority to impose a tax rate of 10%. For aluminum coils, the applicant admitted a tax rate of 2%, but the assessing authority imposed a tax rate of 4% for sales covered by form C and 10% for those not covered.

3. Interpretation of "Tax Due Under the Act" and "Admitted by the Appellant in the Return Filed by Him":
The court examined the meaning of "tax due under the Act" and "admitted by the appellant in the return filed by him." The applicant argued that the tax was admitted at 2% in the return, and failure to obtain form C should not result in a higher tax liability. The court referenced previous judgments, including Commissioner of Sales Tax v. Venus Auto Traders and Commissioner, Sales Tax v. Bishambhar Dutt Mohan Lal, which interpreted the admitted tax as the amount shown in the return, not affected by the failure to file specific forms.

4. Compliance with Section 9(1-B)(a) of the U.P. Sales Tax Act:
Section 9(1-B)(a) stipulates that no appeal shall be entertained unless the appellant furnishes satisfactory proof of payment of the tax admitted in the return or at any stage in the proceedings, whichever is greater. The court found that the applicant's inability to furnish form C resulted in a failure to provide satisfactory proof of payment of the admitted tax, thus non-compliance with section 9(1-B)(a).

5. Applicability of Supreme Court Judgments on the Classification of Goods:
The court referred to the Supreme Court's judgment in Hindustan Aluminium Corporation Ltd. v. State of U.P., which held that aluminum coils are taxable as unclassified items. This judgment was applicable during the assessment proceedings and was noted by the assessing authority. The court also referenced the Supreme Court's decision in Kanpur Vanaspati Stores v. Commissioner of Sales Tax, which emphasized that an assessee is bound by the admissions made before the assessing authority and cannot deny tax liability at the time of appeal.

Conclusion:
The court concluded that the applicant failed to comply with the provisions of section 9(1-B)(a) by not furnishing satisfactory proof of payment of the admitted tax. The inability to file form C and the Supreme Court's classification of aluminum coils as unclassified items justified the higher tax rate imposed by the assessing authority. The appeal was dismissed, and the revision was found to be without merit. The judgment of the Tribunal was upheld, confirming the applicant's failure to comply with the statutory requirements. The revision petition was dismissed.