2014 (5) TMI 212 - HC - VAT and Sales Tax

Eligibility for sales tax exemption - Maintainability of JCC Tax(A) dismissal order u/s 12-D of the Karnataka Sales Tax Act, 1957 Can the assessee without questioning the assessment order file application for cancellation order u/s 12-D Whether Tribunal was justified in dismissing STA No.1129/2003 and ST Rectification Application No.06/2011 u/s 22 (6A) as not maintainable u/s 22 - Held that - u/s 12-D(3) r/w Section 20 bars filing of appeal Assessee was not required to prefer appeal against the order dated 2.5.2001 therefore the appeal rejected as not maintainable by order dated 28.12.2002. U/s 22(1) an appeal to the Appellate Tribunal objecting to an order u/s. 12-D or by the DC or the JC u/s. 20 or 21 within 60 days u/s 22(2) Appellate Tribunal can admit an appeal preferred after 60 days to 180 days if it is satisfied that the appellant had sufficient cause Admittedly assessee did not question the order dated 02.05.2001 Annexure-C rejecting the application u/s. 12-D within the time stipulated u/s 22(1) &(2) before Tribunal - STA No.1129/2003 filed by the petitioner calling in question the order dated 02.05.2001, Annexure-C passed u/s. 12-D and the order dated 28.12.2002 filed u/s. 20 before the JCC Taxes(A) was not maintainable appeal u/s 22 - Thus appeal filed u/s 20 was rejected as not maintainable by the JC(A) Decided against assessee.

Summary

Issues:
1. Maintainability of appeal under Section 12-D of the Karnataka Sales Tax Act for cancellation of assessment order.
2. Justification of dismissing appeal by Karnataka Appellate Tribunal under Section 22 of the Act.
3. Validity of rejecting Rectification Application under Section 22(6A) of the Act.

Issue 1:
The petitioner, a partnership firm engaged in manufacturing paints, claimed Sales Tax exemption for Small Scale Industrial Units for the assessment year 1997-98. The Assessing Officer declined the exemption, leading the petitioner to file an application under Section 12-D of the Karnataka Sales Tax Act for cancellation of the assessment order. The Assessing Authority rejected the application, stating that no appeal lies under Section 20 against an order passed under Section 12-D. Consequently, the appeal filed under Section 20 before the Joint Commissioner of Commercial Taxes was deemed not maintainable. The court upheld this decision, emphasizing the statutory bar to appeal under Section 20 against orders passed under Section 12-D.

Issue 2:
The petitioner failed to question the order rejecting the application under Section 12-D within the stipulated time for appeal to the Karnataka Appellate Tribunal under Section 22 of the Act. Subsequently, the appeal filed under Section 20 before the Joint Commissioner of Commercial Taxes was also deemed not maintainable under Section 22. The Karnataka Appellate Tribunal dismissed the appeal, noting that it was rightly rejected by the Joint Commissioner for Appeals. The court affirmed this decision, highlighting that the petitioner did not follow the proper appellate procedure under Section 22, rendering the appeal before the Tribunal unsustainable.

Issue 3:
Given the previous findings that the appeal under Section 20 was not maintainable and the subsequent dismissal by the Karnataka Appellate Tribunal, the Rectification Application under Section 22(6A) was also deemed not maintainable. The Karnataka Appellate Tribunal's rejection of the Rectification Application was upheld by the court, emphasizing the lack of merit in the petitions due to the failure to adhere to the statutory appeal provisions under the Act. Consequently, all petitions were rejected for lacking legal grounds.

This judgment delves into the procedural intricacies of appeals under different sections of the Karnataka Sales Tax Act, emphasizing the importance of following the prescribed statutory procedures for maintaining the validity of appeals and applications. The court's analysis underscores the significance of compliance with the specific provisions of the Act to ensure the maintainability of legal actions in tax matters.