2017 (11) TMI 527 - HC - VAT and Sales Tax

Rectification of assessment order - petitioner requested the respondent to refer to the Government Order and revised the assessment by exercising powers under Section 55 of the Act - application has been rejected on the ground that there is no direction in the Government Order to levy tax below 10% - Held that - identical issue decided in the case of J.G.Hosiery Private Limited V. Special Commissioner & Commissioner of Commercial Taxes, Chennai and another 2017 (11) TMI 524 - MADRAS HIGH COURT , where on similar issue it was held that since the petitioner has approached this Court challenging a notice proposing to levy tax at 10%, the matter has to be necessarily remanded to the Assessing Officer - matter is remanded to the respondent for fresh consideration - petition allowed by way of remand.

Summary

Issues involved:
Challenge to rejection of application under Section 55 of TNGST Act for rectifying CST assessment order for the year 2003-2004 based on Government Order; Interpretation of Government Order directing waiver of 90% tax liability on inter-state sales without 'C' forms; Reference to a similar case involving revision notices proposing excess tax levy on inter-state turnover; Request for remand to Assessing Officer for fresh consideration based on previous case directions.

Analysis:
The petitioner, a hosiery garments manufacturer, challenged the rejection of their application under Section 55 of the TNGST Act to rectify an assessment order under the CST Act for the year 2003-2004. The application was based on a Government Order (G.O.(Ms)No.75 dated 25.07.2006) directing the waiver of 90% tax liability on inter-state sales of hosiery goods without 'C' forms, provided that no more than 1% CST was collected. The rejection was due to the absence of a specific direction in the Government Order to levy tax below 10%.

In a similar case, J.G.Hosiery Private Limited challenged revision notices proposing excess tax levy on inter-state turnover. The Court referred to a circular and an order by the Appellate Deputy Commissioner, which clarified the option to avail a reduced tax rate of 1% on inter-state sales. The Court directed the dealer to submit objections before the Assessing Officer, emphasizing the legal position and striking down the enhanced tax rates.

The petitioner sought a remand to the Assessing Officer with similar directions as in the J.G.Hosiery Private Limited case. The High Court allowed the writ petition, setting aside the impugned order and remanding the matter to the respondent for fresh consideration. The respondent was instructed to decide the petition under Section 55, considering the previous case's directions and to pass a speaking order after providing an opportunity for a personal hearing to the petitioner. No costs were awarded, and the connected miscellaneous petition was closed.