2016 (5) TMI 1057 - HC - VAT and Sales Tax

Rejection of C-forms - petitioner not been able to co-relate the two C-forms with matching invoices - adding two components of a bill to arrive at a sum carrying the difference of a rupee has resulted in two C-forms of combined value in excess of ₹ 61 lakh - Held that - once the State does not suspect that the petitioner was trying to pass off a sales tax C-form in respect of a transaction without justification and when the arithmetical error is to the extent of Re.1, the Board ought to have allowed the petitioner the latitude and accepted the co-relation of the invoices with the relevant C-forms. It is true that in matters of accounts, the figures should tally up to the last digit on either side and chartered accountants burn their midnight all over such details, but when it comes to a matter of adjudication as to whether the relevant bill was relatable to the amounts claimed in the two C-forms, the Board ought to have shown a greater degree of flexibility and accepted the same. Therefore, the petitioner is entitled to the benefits in respect of C-forms bearing nos.2116542 and 2116543 since all the invoices pertaining thereto have been identified and there is substantial co-relation which has been established. - Decided in favour of appellant

Summary

Issues:
1. Rejection of C-forms by the West Bengal Commercial Taxes Appellate and Revisional Board due to an arithmetical error.
2. Failure to co-relate C-forms with matching invoices.
3. Consideration of flexibility by the Board in accepting the co-relation of invoices with C-forms.

Analysis:
1. The petitioner's grievance stemmed from an error in adding two components of a bill, resulting in a difference of a rupee, leading to the rejection of two C-forms with a combined value exceeding ?61 lakh by the West Bengal Commercial Taxes Appellate and Revisional Board. The Court highlighted the minor nature of the error and the need for flexibility in such cases.

2. The Board rejected the C-forms as the petitioner failed to co-relate them with matching invoices adequately. While some bills were identified, a specific bill dated August 31, 2005, was not independently produced before the Board, causing discrepancies in the total amounts mentioned in the C-forms and invoices. The Court emphasized the necessity of establishing a clear co-relation between C-forms and relevant invoices for proper validation.

3. Despite an arithmetical discrepancy of one rupee, the Court opined that the Board should have demonstrated more flexibility in accepting the co-relation between the invoices and C-forms. Acknowledging the meticulous nature of accounting practices, the Court emphasized the importance of substantial co-relation and identification of invoices to validate the C-forms. Ultimately, the Court allowed the petition, setting aside the Board's order and granting the petitioner benefits concerning the disputed C-forms, directing the assessing authority to adjust the demand accordingly.

In conclusion, the judgment addressed the rejection of C-forms due to an arithmetical error, emphasized the importance of co-relating C-forms with invoices, and underscored the need for flexibility in such matters to ensure fair adjudication and benefit entitlement for the petitioner.