2007 (4) TMI 631 - HC - VAT and Sales Tax

Summary

Issues involved:
1. Interpretation of rule 11A of the Madhya Pradesh General Sales Tax Rules, 1959 regarding amendment of registration certificate.
2. Failure of the registering authority/Sales Tax Officer to communicate rejection of application within the specified time frame.
3. Justification of refusal to grant exemption/reduced rate of tax based on registration certificate.

Analysis:
1. The petitioner, a milk co-operative society, sought amendment of their registration certificate to include skimmed milk powder as raw material. The society claimed exemption from sales tax for the assessment year 1988-89 based on this amendment request. However, the assessing authority and revisional authority rejected the claim, citing the absence of skimmed milk powder in the registration certificate.

2. The petitioner argued that as per rule 11A, if the registering authority fails to dispose of an amendment request within the specified time, it is deemed to be accepted. The respondents allegedly did not communicate the rejection of the amendment request within the required timeframe, hindering the petitioner from challenging the decision. The failure to communicate the rejection was deemed a violation of sub-rule (2) of rule 11A.

3. The respondents contended that the amendment request was actually rejected in 1986, but failed to provide evidence of communication of the rejection to the petitioner. The petitioner insisted that the rejection should have been communicated within ten days as per the rule. As the rejection was not communicated, the court held that the orders of assessment and revisional authority should be set aside, directing a reconsideration of the amendment application and completion of assessment proceedings for the relevant period.

In conclusion, the court allowed the petition, set aside the previous orders, and directed the assessing authority to review the amendment application and communicate the decision to the petitioner. The court emphasized the importance of following procedural requirements, especially in matters concerning registration certificates and tax exemptions.