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2019 (2) TMI 2009 - HC - VAT and Sales TaxDeletion of Tax free and First Point Tax Paid goods turnover from the taxable turnover - receipts of hire charges recovered from contractors by appellant falls within ambit of deemed sales as contemplated u/s 2(g)(iv) of the Orissa Sales Tax Act or not - receipt of hire charges of machinery s from inter-department of the assessee for account purpose is sale to self or not. Whether the learned Tribunal is justified in not deleting the Tax free and First Point Tax Paid goods turnover from the taxable turnover and as such the order is illegal arbitrary? - HELD THAT - The question which has been poised for consideration whether deletion of tax free and first-point tax paid goods from taxable turnover, is warranted or not, on the basis of ratio of Madras High Court does not arise, as there was nothing on record to show that earlier tax was paid or materials to that effect was ever produced before any of the authority. Even if learned Tribunal s observation on Madras High Court is taken into consideration, the learned Tribunal while considering the law has discussed the judgment of the Hon ble Supreme Court and has come to the conclusion that no material was produced on record to give any benefit in favour of the assessee. Whether the learned Tribunal is justified in holding that the receipts of hire charges recovered from contractors by appellant falls within ambit of deemed sales as contemplated u/s 2(g)(iv) of the Orissa Sales Tax Act? - Whether the receipt of hire charges of machinery s from inter-department of the assessee for account purpose is sale to self as contemplated u/s 2(g)(iv) of the Orissa Sales Tax Act? - HELD THAT - The questions have rightly been decided by learned Tribunal, wherein it is observed that the contract was not completely placed on record - We need not reproduce the complete reasoning of learned Tribunal, which have been reproduced in the preceding paragraphs. The questions those have been raised by the petitioner are basically emanating from finding of fact and therefore, no question of law arises for our consideration. In that view of the matter, all reference are required to be answered in favour of the Department against the assessee - tax revision dismissed.
Issues Involved:
1. Whether the assessee is a dealer and carried on business in unserviceable materials/used discarded materials/scrap. 2. Whether the Tribunal is justified in not deleting the tax-free and first point tax paid goods turnover from the taxable turnover. 3. Whether the levy of tax on the turnover of materials supplied to contractors on a cost basis is justified. 4. Whether the receipts of hire charges recovered from contractors fall within the ambit of deemed sales under Section 2(g)(iv) of the Orissa Sales Tax Act. 5. Whether the receipt of hire charges of machinery from inter-department use is considered a sale to self under Section 2(g)(iv) of the Orissa Sales Tax Act. 6. Whether the Tribunal was justified in sustaining the enhancement of turnover based on fraud reports. 7. Whether the Tribunal erred in holding that there was suppression of ?27,17,070.00 in a specific case. 8. Whether the imposition of interest under Section 12(4-a) of the OST Act for the assessment year 1994-95 is justified. 9. Whether the levy of interest on the assessee is justified without proving mens rea or motive. Detailed Analysis: Issue 1: Dealer and Business in Scrap Materials The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Issue 2: Deletion of Tax-Free and First Point Tax Paid Goods Turnover The petitioner argued that the Sales Tax Officer erred in including the turnover of materials supplied to contractors on a cost recovery basis in the gross turnover. The court examined the orders of the Assessing Officer, the Appellate Authority, and the Tribunal, all of which concluded that the materials supplied to contractors constituted a sale under the OST Act. The Tribunal relied on various judicial precedents, including the Supreme Court's decision in N.M. Goel & Co. v. Sales Tax Officer, to affirm this view. The court upheld the Tribunal's decision, stating that no material was produced to show that tax was previously paid on these materials. Issue 3: Levy of Tax on Materials Supplied to Contractors The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Issue 4: Receipts of Hire Charges as Deemed Sales The petitioner argued that hire charges for machinery supplied to contractors should not be considered as deemed sales under Section 2(g)(iv) of the OST Act. The court reviewed the Tribunal's detailed analysis, which concluded that the transactions constituted a transfer of the right to use the machinery, thereby falling within the ambit of deemed sales. The Tribunal cited various judicial precedents to support its conclusion. The court upheld the Tribunal's decision, stating that the findings were based on substantial evidence and legal principles. Issue 5: Receipt of Hire Charges from Inter-Department Use The petitioner argued that hire charges from inter-department use should not be considered as a sale to self under Section 2(g)(iv) of the OST Act. The court reviewed the Tribunal's findings, which concluded that the transactions constituted a transfer of the right to use the machinery. The Tribunal cited relevant case law to support its decision. The court upheld the Tribunal's decision, stating that the findings were based on substantial evidence and legal principles. Issue 6: Enhancement of Turnover Based on Fraud Reports The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Issue 7: Suppression of ?27,17,070.00 The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Issue 8: Imposition of Interest under Section 12(4-a) of the OST Act The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Issue 9: Levy of Interest Without Proving Mens Rea The petitioner did not press this issue during the arguments. Therefore, no detailed analysis was provided by the court on this matter. Conclusion The court dismissed all the tax revisions, upholding the Tribunal's decisions on the issues that were argued. The court found that the Tribunal's conclusions were based on substantial evidence and legal principles, and no question of law arose for further consideration. The tax revisions were accordingly dismissed in favor of the Department and against the assessee.
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