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2017 (11) TMI 528 - HC - VAT and Sales TaxExtension of stay order - extension sought for the sole reason that the petitioner has not filed any Writ Petition in respect of the revised assessment order for the assessment year 2009-10, whereas, they have filed the Writ Petitions in W.P.Nos.31968 to 31970 of 2015 challenging the assessment orders for the years 2006-07 to 2008-09, as could be seen from the typed-set of papers filed in support of this Writ Petition - Held that - the first respondent was not justified in refusing to extend the order of stay, though the interest of the Revenue is fully safeguarded, that is to say, 50% of the disputed tax and the balance 50% was secured by way of Bank Guarantee - the interest of the Revenue is fully safeguarded and the first respondent is directed to consider and dispose of the Appeal Petition on merits and in accordance with law - petition allowed by way of remand.
Issues:
1. Validity of the order of assessment under the Tamil Nadu Value Added Tax Act, 2006 for the assessment year 2009-10. 2. Extension of Stay Order in relation to the disputed tax amount. 3. Justification of the first respondent's decision to refuse extension of the stay order. 4. Validity of the Bank Guarantee filed by the petitioner. 5. Direction for the first respondent to consider and dispose of the Appeal Petition on merits. Analysis: 1. The petitioner challenged the order of assessment under the Tamil Nadu Value Added Tax Act, 2006 for the assessment year 2009-10. An Appeal was filed before the Joint Commissioner (CT) Appeals, Chennai, which required payment of 25% of the disputed tax and a Bank guarantee for the remaining amount. The petitioner sought an extension of the Stay Order, emphasizing the absence of a Writ Petition for the revised assessment order for 2009-10, despite filing Writ Petitions for other assessment years. The issue pertained to Input Tax Credit reversal in Works Contract/SEZs. 2. The first respondent directed the petitioner to pay a further 25% of the disputed tax and furnish a Bank guarantee. The petitioner's Bank Guarantee was valid until a certain date, but discrepancies arose regarding its actual validity. The Court found that the interest of the Revenue was adequately safeguarded with the existing Bank Guarantee, securing 50% of the disputed tax, and directed the first respondent to consider and dispose of the Appeal on its merits. 3. The Court concluded that the first respondent was not justified in refusing to extend the Stay Order, as the Revenue's interest was fully protected with the Bank Guarantee. The petitioner was instructed to maintain the Bank guarantee until the Appeal's disposal, ensuring the Revenue's security. The decision emphasized the need for a fair consideration of the Appeal Petition in accordance with the law, with the Stay Order remaining in effect during the proceedings. 4. The Court's direction for the first respondent to proceed with the Appeal Petition on its merits and ensure the continuation of the Interim Stay until the final disposal of the Appeal highlighted the importance of upholding legal procedures and safeguarding the interests of both parties. The judgment emphasized the need for a thorough review of the case and adherence to legal principles in addressing tax assessment disputes under the TNVAT Act. 5. In conclusion, the Writ Petition was disposed of with the above directions, and no costs were awarded. The connected miscellaneous petition was closed, marking the resolution of the legal dispute concerning the assessment order for the specified year under the TNVAT Act.
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