2022 (7) TMI 1415 - HC - VAT and Sales Tax

Input Tax Credit - purchase of capital goods as per Section 6(6)(b) of the U.K. VAT Act - permission of re-assessment under Section 29(4) of the U.K. VAT Act - change of opinion - HELD THAT - If the petitioner has come to the Court, generally in normal circumstances, it is for the petitioner to demonstrate or establish that the order passed by the authorities suffers from any illegality requiring interference of this Court in exercise of certiorari jurisdiction. It is well settled principle of law that this certiorari jurisdiction should be exercised only to bring the Tribunal, functioning in the State within its jurisdiction. In this case, the respondent has demonstrated that petitioner has received input tax credit. It is also demonstrate by the respondent that upon receiving the assessment of the vendor, the Additional Commissioner was of the view that the matter should be re-looked to find if any tax concession/credit has been granted to the petitioner to which he is not entitled to. This Court is of the opinion that the learned Senior Advocate appearing for the petitioner has failed to establish that the respondents acted beyond their jurisdiction or acted in a manner not provided in the statute. The entire litigation revolves around the question that the plant and machinery for which the petitioner has claimed the input tax credit is new machinery and not old and used machinery. There is no merit in the writ application. The writ application is, therefore, dismissed.

Summary

Issues:
Petitioner seeks writs of mandamus, prohibition, and certiorari against Deputy Commissioner and Additional Commissioner for re-assessment and input tax credit for Assessment Year 2010-11 under Uttarakhand VAT Act. The main issue is the validity of re-assessment and entitlement to input tax credit on the purchase of capital goods.

Analysis:
1. The petitioner, engaged in the business of manufacturing H.D.P. pipes and plastic products, filed for input tax credit on capital goods for the assessment year 2010-11. The Additional Commissioner raised concerns about the validity of the credit granted and issued a notice for re-assessment on the grounds of ineligibility. The petitioner contested, arguing against re-assessment based on the same facts and claiming the original assessment was correct. The Additional Commissioner rejected the objection, leading to a notice for re-assessment.

2. The petitioner's counsel heavily relied on a previous judgment to challenge the re-assessment order, arguing that there was no new material before the Additional Commissioner to grant permission for re-assessment. The Court directed the petitioner to file a supplementary affidavit to determine if the machinery purchased was new or old, impacting the entitlement to input tax credit. The petitioner failed to demonstrate the purchase of new machinery in any submitted documents, leading to a lack of evidence supporting the claim for input tax credit.

3. The Court emphasized the principle that certiorari jurisdiction should only be exercised when authorities act beyond their jurisdiction or unlawfully. The crux of the case revolved around whether the machinery purchased qualified for input tax credit. Despite lengthy arguments, the petitioner's counsel failed to provide concrete evidence or averments supporting the claim of purchasing new machinery. The lack of substantiated claims led to the dismissal of the writ application.

4. Additionally, the Court noted that the vendor from whom the machinery was purchased, M/s Time Technoplast Ltd., was a necessary party to the case but was not included, providing an additional ground for the dismissal of the writ application. Ultimately, the Court found no merit in the petitioner's claims and dismissed the writ application without costs.

In conclusion, the judgment delves into the intricacies of re-assessment and entitlement to input tax credit under the Uttarakhand VAT Act for the assessment year 2010-11. It highlights the importance of providing substantial evidence to support claims in legal proceedings and the necessity of including all relevant parties in the litigation process.