2018 (6) TMI 112 - HC - VAT and Sales Tax

Appeal rejected as time barred - telecommunication services - taxability of rentals of the basic telephone as well as the supply of SIM cards - Held that - When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. The judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. The Court finds that while passing the judgment and order dated 13.12.2017 in Defective Appeal the Tribunal has committed gross illegality in not considering the ratio of the judgments referred and has dismissed the appeal as time barred - it is well established that the impugned judgment and order dated 13.12.2017 suffers from manifest error of law and is hereby set aside. Matter restored before the tribunal.

Summary

Issues:
Challenge to judgment and order of Commercial Trade Tax Tribunal for Assessment Year 2004-05.

Analysis:
The revisionist, a Government undertaking providing telecommunication services, challenged the judgment by Commercial Trade Tax Tribunal for the Assessment Year 2004-05. The revisionist contended that the Tribunal erred in not considering key decisions by the Apex Court regarding taxation on telecommunication services. The revisionist argued that the services provided do not fall under taxable categories based on legal precedents. Additionally, the revisionist highlighted that service tax had been paid, making it exempt from sales tax. The Tribunal's dismissal of the appeal on technical grounds was questioned, emphasizing that substantial justice should prevail over technicalities.

The revisionist further argued that the Tribunal's decision to dismiss the appeal based on delay was unjust. Citing Supreme Court judgments, the revisionist emphasized the importance of substantial justice and the need to avoid technicalities that hinder justice delivery. The revisionist contended that the Tribunal failed to consider these legal principles, leading to an erroneous dismissal of the appeal. The revisionist stressed that the Tribunal's decision was in violation of established legal norms and required intervention by the Court.

The Court, upon review, found that the Tribunal had erred in dismissing the appeal solely on grounds of delay. Citing Supreme Court precedents, the Court emphasized the need for substantial justice to prevail over technical considerations. The Court noted that the Tribunal had failed to apply these principles, leading to a manifest error of law. Consequently, the Court set aside the Tribunal's judgment and remanded the matter for reconsideration on merit within a specified timeframe. The Court's decision favored the revisionist, allowing the appeal to proceed based on legal merits rather than technicalities.