2016 (1) TMI 1105 - HC - VAT and Sales Tax

Illegality and arbitrariness - Revision order not passed for want of Form C - Inter-state sale and sale made to SEZ - Respondent submitted that the Writ Petition is not maintainable, as the assessee / writ petitioner has invoked this jurisdiction despite the availability of an equally efficacious alternative remedy of filing an appeal - Held that - the petitioner is regularly filing their monthly returns and complying with the statutory requirements. The respondent has also accepted the turnover reported by the petitioner as correct and determined the same. However, for want of Form C and Form I , the respondent adopted higher rate of tax at 14.5% also. Therefore, in view of the Full Bench Judgment of this Court in the case of State of Tamil Nadu v. Arulmurugan and Company 1982 (11) TMI 143 - MADRAS HIGH COURT and also the circular dated 01.02.2000 issued by the Commissioner of Commercial Taxes, Chennai, the Writ Petition is allowed by setting aside the impugned orders and directing the respondent to accept the Form I filed by the petitioner on 19.01.2016 for the sales made to SEZ for the assessment year 2011-2012 and pass orders afresh in accordance with law. - Decided in favour of petitioner

Summary

Issues:
1. Challenge to orders passed under Central Sales Tax Act, 1956.
2. Dispute regarding higher tax rate due to non-submission of Form 'C' and Form 'I'.
3. Interpretation of Section 12(7) of the Central Sales Tax (Registration and Turnover) Rules, 1957.
4. Validity of circular dated 01.02.2000 issued by the Commissioner of Commercial Taxes, Chennai.
5. Maintainability of Writ Petition due to alternative remedy of appeal.

Detailed Analysis:
1. The petitioner, a registered dealer under the Central Sales Tax Act, challenged orders passed by the respondent regarding the assessment year 2011-12. The petitioner reported inter-State sales to SEZ and faced higher tax rates due to the non-submission of Form 'C' and Form 'I'. The petitioner sought revision of the order based on Section 12(7) of the CST Rules.

2. The dispute centered around the respondent's refusal to pass a revised order despite the petitioner submitting Form 'C' and Form 'I' later. The petitioner argued that the respondent's action was arbitrary and illegal, citing a circular from the Commissioner of Commercial Taxes and the precedent set by the Full Bench of the High Court.

3. The Court examined Section 12(7) of the CST Rules, emphasizing the authority's power to allow submission of declaration forms beyond the prescribed time upon satisfaction of sufficient cause. It noted that the petitioner regularly complied with statutory requirements and that the respondent's imposition of a higher tax rate was unjustified.

4. The Court referred to the circular dated 01.02.2000, emphasizing the need for assessing officers to be liberal in admitting new 'C' forms and passing revised assessment orders. The circular was based on the Full Bench judgment, which highlighted the authority's power to allow further time for filing 'C' forms without burdening the assessee.

5. The Court allowed the Writ Petition, setting aside the impugned orders and directing the respondent to accept the Form 'I' filed by the petitioner for the assessment year 2011-2012. It relied on the Full Bench judgment and the circular to support its decision, emphasizing the need for fairness and adherence to legal principles. The Court's decision highlighted the importance of upholding procedural justice and ensuring compliance with statutory provisions.