2019 (6) TMI 803 - HC - VAT and Sales Tax

Concessional rate of tax - Form-C - CST Act - interstate trade or commerce - revision of the assessment on the basis of Forms submitted post assessment - HELD THAT - With regard to exemption to a dealer under the CST Act for sale made in the case of interstate trade or commerce to a registered dealer for the purpose of setting up, operation, maintenance, manufacture, trading, production, processing, assembling, repairing, reconditioning, re-engineering, packaging or for use as packing material or packing accessories in a unit located in any SEZ, the same is contained in Sub Section (6) of Section 8 of CST Act. Sub Section (6) of Section 8 of CST Act was inserted in the CST Act vide Act 20 of 2002, which is Finance Act. It was inserted with effect from 11.05.2002. The applicability of Sub Section (6) of Section 8 of CST Act and exemption on submission of Form I subject of course to scrutiny of Form I, by the Assessing Officer is not in dispute. Revenue is not disputing the principle and ratio laid down in East Coast Bearings case 2018 (3) TMI 681 - MADRAS HIGH COURT . The principle in very simple terms is that certain Forms submitted by an assessee post completion of assessment order, can certainly be looked into and there can be revision of the assessment on the basis of Forms submitted post assessment, subject of course to scrutiny of the Forms. It is also to be noted that there are no other attendant issues or facts, which impact this exercise in the instant case. Respondent assessee shall examine Form I submitted by the petitioner assessee on 13.02.2019 and pass assessment order afresh. If it entails revision of assessment order already made on 31.8.2017, the same shall be done. The impugned order is set aside - petition allowed.

Summary

Issues:
1. Revision of assessment order based on post-assessment submissions.
2. Application of principles from a previous judgment to the current case.
3. Disregard of a superior court judgment by the assessing authority.

Issue 1: Revision of assessment order based on post-assessment submissions

The case involved a writ petition where the petitioner, a trader in IT products, sought revision of the assessment order for the assessment year 2014-2015. The petitioner had submitted additional Forms I post-assessment, pertaining to sales made to a unit in a Special Economic Zone (SEZ). The assessing authority had initially refused to revise the assessment order based on these additional submissions. The petitioner argued that, as per previous judgments, post-assessment submissions could be considered for revision of the assessment order. The court noted that the principle established in previous cases allowed for the revision of assessment based on post-assessment submissions, subject to scrutiny. The court found no reason why this principle should not apply to the petitioner's case, even though the submissions were in the form of Form I for exemption rather than Form C for concessional rates of tax.

Issue 2: Application of principles from a previous judgment to the current case

The court referred to a previous judgment, the East Coast Bearings case, where it was held that post-assessment Forms submitted by an assessee could be considered for revision of the assessment order. The court emphasized that the principle established in the East Coast Bearings case should apply to the current case as well, regardless of the type of Form submitted (Form I for exemption in this case). The court reasoned that the distinction between concession and exemption did not hold in the peculiar circumstances of the case, and the principle from the previous judgment should benefit the petitioner.

Issue 3: Disregard of a superior court judgment by the assessing authority

The court observed that the assessing authority had disregarded the judgment of a superior court (Hon'ble Division Bench) without providing adequate reasons for its decision. The assessing authority had summarily stated that the judgment was not relevant to the case, without elaborating on why it was not applicable. The court criticized this approach, stating that the judgment of a superior court should not be disregarded without proper justification. The court concluded that the assessing authority's failure to explain why the judgment was not applicable amounted to a case of misreading or misinterpretation of the judgment.

In conclusion, the court set aside the impugned order of the assessing authority and directed a fresh assessment based on the Form I submitted by the petitioner. The court emphasized the importance of following established legal principles and respecting judgments of superior courts in such matters.