2018 (2) TMI 1431 - HC - VAT and Sales Tax

Demand on the ground that the assessee did not furnish the prescribed Form F declarations to prove that the transaction in question were branch transfers not attracting levy of CST - Held that - this Court is satisfied that Respondent Department itself failed to issue blank F Form declarations, allowing the petitioner in turn to furnish the same on monthly basis, as required under Rule 12(5) of CST Rules. The consolidated F Form for the entire year, which gives the details of such branch transfers supported by other relevant documents, such as Proforma Invoices and Delivery Challans has been rejected on the ground that separate F Forms were not filed within the period of limitation. The respondent has not produced any specific Rule prescribed for limitation for the said purpose and therefore, the separate F Forms furnished by the petitioner assessee could not have been rejected on the ground of being filed belatedly. The demand raised against the petitioner assessee for the alleged failure of production of separate F Forms, cannot be sustained - petition allowed - decided in favor of petitioner.

Summary

Issues:
1. Dispute over the requirement of filing separate 'F' Forms for each tax period.
2. Lack of time limitation prescribed for furnishing 'F' Forms under CST Rules.
3. Failure of the Department to issue blank 'F' Form declarations.

Analysis:

1. The petitioner, an assessee, challenged an order by the Deputy Commissioner of Commercial Taxes raising a demand for the tax period 2007-2008/CST due to the non-furnishing of prescribed Form 'F' declarations to prove branch transfers not attracting CST. The Assessing Authority rejected a single 'F' Form for the entire year, insisting on separate forms for each tax period monthly. The petitioner argued that no time limitation was prescribed for filing 'F' Forms under CST Rules.

2. The petitioner contended that the rejection of separate 'F' Forms filed later due to alleged expiration of time was unjustified as CST Rules do not specify any time limit for furnishing 'F' Forms. The petitioner also highlighted an Endorsement directing him to obtain the original 'F' Form from the Local VAT Office.

3. The Department argued that even without a specific time limit in CST Rules, separate 'F' Forms for each month should have been submitted before the impugned order. However, the Court noted the Department's failure to provide blank 'F' Form declarations to the petitioner for monthly submission as required by Rule 12(5) of CST Rules.

4. The Court found in favor of the petitioner, stating that the rejection of separate 'F' Forms due to an alleged delay was unjustified as no specific rule prescribed a time limitation for such filings. Consequently, the demand raised against the petitioner for not producing separate 'F' Forms was deemed unsustainable, leading to the quashing of the impugned order.

5. The Court allowed the Writ Petition, quashed the demand against the petitioner, and invalidated the impugned order dated 29.4.2014. No costs were awarded in the matter.