2013 (5) TMI 161 - HC - VAT and Sales Tax

Delayed submission of C forms - Power of AO to condone the dealy - Inter state sale - Proviso to Section 8(4) of the CST Act and so also Rule 12(7) of the CST Rules - Second proviso to Rule 12(1) of the CST (R and T) Rules 1957 - Held that - the Tribunal has no power to grant indefinite time to obtain C-forms for production at any time the dealer wants and that the C-forms should have been produced at the assessment stage itself. Even for accepting belated C-forms, the assessee has to furnish explanation. Since the Assessing Officer has not considered the matter with specific reference to the power to condone the delay and since the explanation offered by the petitioner herein has not been considered at all, the matter requires reconsideration. In view of the power conferred upon the assessing authority to condone the delay by virtue of the proviso of the Rule 12(7), rejection of C-forms of the petitioner holding that they were belated was not correct and proper - Matter remanded back.

Summary

Issues:
Challenging assessment orders for declining to accept C-forms, clubbing different quarters together, validity of circular issued by Commissioner, failure to consider explanation for delay in filing C-forms, exercise of power to condone delay, consideration of explanation offered, scope of proviso to Rule 12(7), clubbing of different quarters in one declaration.

Analysis:
The petitioner contested assessment orders Exts.P6 to P8 due to the refusal to accept C-forms and the improper clubbing of quarters in declarations. The petitioner explained the delay in filing C-forms, citing difficulties in obtaining them from distant locations. The assessing authority issued pre-assessment notices and rejected the explanation, leading to the assessment orders. The challenge was based on the alleged contravention of relevant statutory provisions, particularly the 'proviso' to Section 8(4) of the CST Act and Rule 12(7) of the CST (Registration and Turn Over) Rules regarding the authority's power to accept explanations for delayed filings.

The respondents argued that the petitioner's challenge to the circular issued by the Commissioner was misconceived, emphasizing the need to adhere to time limits for assessment finalization. They contended that the petitioner failed to provide a sufficient cause for the delay in filing C-forms within the prescribed time. The petitioner's explanation for the delay was acknowledged but not accepted by the assessing authority, leading to the dispute over the proper exercise of the authority's power to condone delays.

The Court highlighted the importance of the 'proviso' to Section 8(4) of the CST Act and Rule 12(7) of the CST (R & T) Rules in allowing for the extension of time to furnish declarations or certificates. The Court noted that the assessing authority did not properly exercise this power in the case at hand, necessitating a reconsideration of the matter. The Court referenced a previous judgment that emphasized the requirement for the authority to consider explanations for delayed filings and the power to condone such delays.

Regarding the clubbing of quarters in one declaration, the petitioner argued that it was a procedural error and sought leniency due to the lack of benefit gained. The Court directed the Assessing Officer to reevaluate the matter in light of the observations made, setting aside the assessment orders Exts.P6 to P8 and emphasizing a timely resolution within three months from the date of the judgment. The petitioner was instructed to provide a copy of the judgment to the second respondent for further action.