2009 (1) TMI 789 - HC - VAT and Sales Tax

Condonation of delay in filing the claim for input-tax credit - Held that - If period of 45 days is given from the appointed day , i.e., April 1, 2005, no dealer could have filed his input-tax credit claim nor could the claim be filed with effect from April 24, 2006 when further period of 15 days was granted from that date. It is wellsettled that the law does not contemplate doing of an impossible act. The legislative intent is clear from the reading of sections 13 and 14 of the VAT Act, which allow a dealer to claim input-tax credit subject to various other conditions. It is also clearly made out that period of 45 days is intended to be given to the dealer to make input-tax credit claim. However, the period of 45 days has to be counted from the date of publication of the VAT Rules on June 21, 2005. Any other interpretation would defeat the basic object of sections 13 and 14 of the VAT Act and the VAT Rules. If the intention of the Legislature and the rule-making authorities is gathered from the aforesaid provisions then the period of 45 days has to be reckoned from the date of publication of the VAT Rules. Appeal dismissed.

Summary

Issues:
Delay in filing claim for input-tax credit under the Punjab Value Added Tax Act, 2005.

Analysis:
The case involved an appeal filed under section 68 of the Punjab Value Added Tax Act, 2005 against an order passed by the Value Added Tax Tribunal, Punjab. The dispute arose from the delay in filing the claim for input-tax credit, which was required to be submitted within a specified period. The relevant provisions of the VAT Act and VAT Rules regarding input-tax credit claim were crucial in determining the outcome of the case.

The appellant, a registered dealer under the Sales Tax Act and VAT Act, failed to file the statement of stock of goods within the prescribed period. The designated officer rejected the claim due to the delay in submission. Subsequent appeals and orders by the appellate authority and Tribunal led to conflicting decisions regarding the acceptance of the input-tax credit claim.

The key contention revolved around the interpretation of the VAT Rules and the timeline for filing the input-tax credit claim. The Tribunal accepted the claim based on the argument that the claim was submitted before the publication of the VAT Rules, thus justifying the condonation of the delay. The Tribunal's decision was based on the premise that the legislative intent and rule-making authorities' intention supported a purposive construction of the statute to make the VAT Rules workable.

The High Court analyzed the provisions of the VAT Act and VAT Rules, emphasizing the importance of adhering to the statutory timelines for filing input-tax credit claims. The Court rejected the Revenue's argument that the period for filing should be counted from the "appointed day," highlighting that such an interpretation would defeat the legislative intent behind the VAT Act and Rules. The Court upheld the Tribunal's decision, emphasizing the need for a practical and purposive interpretation to ensure the effective implementation of the statutory provisions.

Ultimately, the High Court dismissed the appeal on the merits, aligning with the Tribunal's decision regarding the acceptance of the input-tax credit claim. The Court refrained from expressing an opinion on the prayer for condonation of delay, as the appeal was dismissed based on the substantive issues discussed in the judgment.