2017 (5) TMI 795 - HC - VAT and Sales Tax

Restoration of registration of dealer - registration certificate of the dealer cancelled both under the VAT Act as well as Central Sales Tax Act solely on the ground that the dealer has not filed returns for three consecutive period i.e. April 2014 to March 2015 - Whether under the facts and circumstance, the learned Tribunal erred in deciding the registration certificate of the respondent were to be restored? - Held that - It appears that thereafter subsequently and having been served with the order cancelling the registrations, the dealer filed the returns along with penalty of ₹ 8000/- and also paid the tax with interest. It appears that there was some criminal case pending against the dealer and their consultant and therefore, he could not consult with the consultant / practitioner and therefore, dealer could not file the return - However, the facts remain that the dealer filed returns and also paid the penalty. The dealer also paid the tax with interest. Nothing adverse to the dealer was found except non filing of the returns for the period between April 2014 to March 2015. It cannot be said that the learned Tribunal has committed any error which calls for the interference of this Court - appeal dismissed - decided in favor of Assessee.

Summary

Issues Involved:
Appeal against the judgment and order passed by the Gujarat Value Added Tax Tribunal regarding the restoration of registrations under the Gujarat VAT Act and CST Act.

Analysis:

1. Appeal against Tribunal's Judgment:
The State appealed against the judgment and order of the Gujarat Value Added Tax Tribunal, which directed the restoration of registrations to a dealer under the Gujarat VAT Act and CST Act. The State questioned whether the Tribunal erred in deciding to restore the registration certificates of the dealer.

2. Background and Facts:
The dealer, engaged in trading chemicals, dyes, and fertilizers, had its registered premises in Gandhidham. The dealer applied for an amendment to include an additional place of business. However, the registration was canceled by the Commercial Tax Officer due to non-filing of returns for three consecutive periods. The dealer paid the outstanding taxes, interest, and penalties, but the registrations were not restored by the First Appellate Authority.

3. Tribunal's Decision and State's Arguments:
The Gujarat Value Added Tax Tribunal allowed the dealer's appeal, quashed the cancellation of registration, and directed the restoration of registrations. The State, represented by the Assistant Government Pleader, argued that the Tribunal erred in restoring the registrations based on the dealer's subsequent compliance with penalties. The State contended that the cancellations were justified due to non-filing of returns.

4. Dealer's Defense and Tribunal's Rationale:
The dealer's advocate argued that the cancellations were unjust as the dealer had informed about the change of premises and rectified the non-compliance by paying penalties and taxes. The Tribunal, in its judgment, noted the lack of proper notice and service to the dealer before cancellation. It criticized the First Appellate Authority for not restoring registrations on extraneous grounds.

5. Court's Decision and Directions:
After hearing both parties, the Court upheld the Tribunal's decision, stating that no substantial question of law warranted interference. The Court dismissed the State's appeals and directed compliance with the Tribunal's order to restore the registrations within three weeks. The Special Civil Application filed by the dealer was also disposed of accordingly.

This comprehensive analysis covers the issues raised in the legal judgment, the background of the case, arguments presented by both parties, the Tribunal's rationale, the Court's decision, and the final directions given regarding the restoration of registrations under the Gujarat VAT Act and CST Act.