2007 (10) TMI 600 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of the order non-suiting the petitioner for relief of certiorarified mandamus.
2. Interpretation of the waiver of sales tax granted to the petitioner.
3. Authority to collect and appropriate sales tax by the appellant.
4. Rejection of the writ petition by the learned single judge.
5. Contentions regarding the specific covenant forbearing the appellant from collecting tax.

Analysis:
1. The writ appeal challenged the order of the learned single judge non-suiting the petitioner for the relief of certiorarified mandamus. The order directed the quashing of an impugned order issued to the appellant for repayment of sales tax collected contrary to the waiver scheme. The learned single judge dismissed the writ petition based on the rejection of the contention that the district industries centre's order allowing tax collection was against the spirit of the Government Order. The court upheld the dismissal, emphasizing the need for tax collection based on law.

2. The appellant had obtained a waiver of sales tax for a specific period, but subsequently collected sales tax for certain assessment years. The court noted that none of the relevant documents authorized the appellant to collect and appropriate sales tax for itself. Despite arguments that no specific covenant forbearing tax collection existed, the court emphasized that tax collection must be lawful, as mandated by the constitution. The court found no merit in the appellant's appeal, leading to its dismissal.

3. The rejection of the writ petition by the learned single judge was based on the finding that the district industries centre's order allowing tax collection was incorrect and against the Government Order. This rejection formed the basis of the dismissal of the petition. The court upheld this decision, highlighting the necessity of tax collection being in accordance with the law and authorized procedures.

4. The appellant's contention regarding the specific covenant forbearing them from collecting tax was considered by the court. Despite arguments that no such prohibition existed in the relevant documents, the court emphasized the requirement for tax collection to be authorized by law. The court dismissed the writ appeal, noting that the appellant could seek relief from the Industries Commissioner based on a plea of misunderstanding of Government orders, if advised to do so.

In conclusion, the High Court dismissed the writ appeal challenging the order non-suiting the petitioner for relief of certiorarified mandamus, emphasizing the need for tax collection to be lawful and in accordance with authorized procedures. The court upheld the rejection of the writ petition by the learned single judge, highlighting the importance of compliance with Government Orders and legal mandates in tax matters.