2017 (6) TMI 1205 - HC - VAT and Sales Tax

Exemption under section 5(1) of the CST Act - denial on the ground that bills of lading were not submitted to him - demand of CST at five per cent. of the direct export sales of spices - Held that - as it is now contended on behalf of the petitioner that copies of bills of lading, for the turnover subjected to tax, are now available and shall be produced before the assessing authority, if an opportunity is given to him to do so, it would be appropriate to set aside the impugned order - petitioner shall furnish the copies of bills of lading to the assessing authority within one week from today and, on receipt of the documents, the assessing authority shall consider the same and pass an assessment order afresh in accordance with law - petition allowed by way of remand.

Summary

Issues:
1. Assessment order challenged for tax payment on direct export sales of spices without bills of lading.
2. Rejection of exemption claim under section 5(1) of the CST Act due to missing bills of lading.
3. Jurisdiction issue under rule 60 for revision of assessment order.
4. Requirement to furnish copies of bills of lading for fresh assessment.

Analysis:
1. The petitioner contested the assessment order demanding tax payment of ?1,72,32,089 on direct export sales of spices without bills of lading. The assessing authority required the petitioner to pay tax at five per cent of the sales amounting to ?34,46,41,775.

2. Despite submitting all necessary documents except bills of lading to prove tax exemption under section 5(1) of the CST Act for exported goods, the petitioner's claim was denied by the assessing authority due to the absence of bills of lading. The petitioner informed that the bills of lading were with the Tirupati Commissionerate of Customs, but copies were not provided despite requests.

3. The petitioner sought rectification under rule 60 of the A. P. Value Added Tax Rules, but the assessing authority rejected the request citing lack of jurisdiction to revise the assessment order. However, the High Court emphasized the importance of bills of lading as evidence of export but acknowledged the submission of other supporting documents by the petitioner.

4. The High Court directed the petitioner to submit copies of bills of lading to the assessing authority within a week for a fresh assessment. Failure to do so would allow the assessing authority to proceed with a new assessment order. The order of bank account attachment was to be maintained until a new assessment was completed within a month, while restoring the petitioner's access to Form 600 waybills immediately.

In conclusion, the writ petition was disposed of with no costs, and pending applications were closed, ensuring compliance with the submission of bills of lading for a revised assessment in accordance with the law.