2016 (1) TMI 91 - HC - VAT and Sales Tax

Demand of VAT - export against form H - rectification of error denied - appellant had sold the car but did not include its value in the returns nor deposited the tax on the sale of fixed assets - Even export sales shown by the appellant were not genuine, because as per documents, the appellant had sold the goods on 25.11.2005 which were dispatched to foreign buyers by the exporters to whom the sale were made against H Forms on 12.12.2005, whereas as per bill of lading, the goods were dispatched on 11.6.2006 i.e. in the next year - failure to explain and produce evidence including purchase vouchers in support of its ITC claim - Held that - When the appellant filed an application for rectification of the aforesaid order dated 27.2.2012 dismissing its appeal, in the interest of justice, the Tribunal should have afforded an opportunity to the appellant to put forward its case. - Matter remanded back. - Decided in favour of assessee.

Summary

Issues:
Delay in filing appeal condonation, substantial questions of law under Punjab VAT Act, 2005, legality of orders by authorities, jurisdiction, sustainability of orders, assessment of additional demand, appeal process, rectification application rejection, remand to Tribunal for fresh decision.

Delay in Filing Appeal Condonation:
The judgment begins by condoning a delay of 192 days in filing the appeal. This decision is crucial as it sets the stage for further proceedings and indicates the court's willingness to consider the case despite the delay.

Substantial Questions of Law under Punjab VAT Act, 2005:
The appellant filed an appeal under Section 68 of the Punjab Value Added Tax Act, 2005, challenging orders passed by the Value Added Tax Tribunal. The appeal raised substantial questions of law regarding the legality and sustainability of the orders issued by the authorities, emphasizing the need for a legal resolution.

Assessment of Additional Demand and Appeal Process:
The appellant, engaged in the business of readymade garments, faced an additional demand of Rs. 26,20,799 due to discrepancies in sales data, tax payments, and export documentation. Despite appealing to the Deputy Excise and Taxation Commissioner and the Tribunal, the appellant's appeals were dismissed, leading to the current legal challenge.

Rectification Application Rejection and Remand to Tribunal:
The Tribunal's rejection of the rectification application and the subsequent appeal highlighted procedural irregularities and the denial of the appellant's right to present its case effectively. The High Court, after considering arguments from both parties, decided to remand the case back to the Tribunal for a fresh decision, emphasizing the importance of due process and a fair hearing for the appellant.

In conclusion, the judgment addressed various issues, including the condonation of appeal delay, substantial legal questions under the Punjab VAT Act, assessment of additional demand, appeal process, rectification application rejection, and the remand to the Tribunal for a fresh decision. The decision to set aside the Tribunal's orders and provide the appellant with an opportunity to present its case reflects the court's commitment to upholding procedural fairness and ensuring a just outcome in the legal dispute.