2012 (7) TMI 860 - HC - VAT and Sales Tax

Revision of assessment - Non genuine C forms - Held that - It is clear from the material on record that the petitioner had enclosed the letter dated June 3, 2010 issued by the Commercial Tax Officer, Circle V, Bhopal, to his reply dated December 26, 2011 addressed to the first respondent in response to the show-cause notice dated April 18, 2011 issued by the first respondent specifically referring to the letter dated June 3, 2010 of the Commercial Tax Officer, Circle V, Bhopal, and states that it was annexed as annexure P1 to the said reply. At page 5 of the impugned order, the first respondent extracted para 4 of the reply dated December 26, 2011 given by the petitioner to his show-cause notice dated April 18, 2011 but he did not meet the contention of the petitioner that the said letter dated June 3, 2010 of the Commercial Tax Officer, Circle V, Bhopal, would show that the C forms filed by it are genuine. The three C forms mentioned in the said letter were alleged by the first respondent to be not genuine in his show-cause notice. It is unfortunate that the first respondent has not considered the letter dated June 3, 2010 filed by the petitioner along with its reply dated December 26, 2011 to the show-cause notice dated April 18, 2011 issued by him. This vitiates the order passed by the first respondent. Therefore the impugned order passed by the first respondent is set aside. The matter is remanded to the first respondent to consider afresh. W.P. allowed.

Summary

Issues:
Challenge to order revising assessment under Central Sales Tax Act and Andhra Pradesh Value Added Tax Act based on alleged non-genuine C forms issued by buyers in another state.

Analysis:
The petitioner, a co-operative society, challenged the revision of assessment for the year 2005-06 under the Central Sales Tax Act and Andhra Pradesh Value Added Tax Act. The second respondent had initially determined the net turnover of the petitioner at a concessional rate of four percent based on C forms issued by buyers in other states, resulting in a tax demand. However, the first respondent proposed to revise this assessment, alleging that three C forms obtained by the petitioner from buyers in Madhya Pradesh were not genuine and sought to levy tax at a higher rate of 12.5 percent. The petitioner contended that the C forms were authentic, supported by a letter from the Commercial Tax Officer in Madhya Pradesh confirming their validity. Despite the petitioner's detailed reply and evidence, the first respondent passed an order without adequately considering the provided documentation, leading to the petition challenging the order on grounds of arbitrariness and lack of proper inquiry.

The High Court, after hearing arguments from both parties and examining the documents, found that the first respondent failed to properly consider the crucial letter from the Commercial Tax Officer in Madhya Pradesh confirming the authenticity of the C forms. The Court noted that the first respondent did not address the petitioner's contention regarding the genuineness of the C forms in question, which was supported by substantial evidence. Consequently, the Court set aside the impugned order and remanded the matter back to the first respondent for a fresh consideration in light of the petitioner's detailed reply and the supporting letter. The Court emphasized the importance of a reasoned decision-making process and directed the first respondent to pass a well-founded order after reevaluation.

In conclusion, the writ petition was allowed to the extent of setting aside the impugned order, with no costs imposed. The judgment highlighted the necessity for authorities to conduct thorough examinations and consider all relevant evidence before making decisions that significantly impact parties involved in tax assessments under the applicable laws.