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2019 (8) TMI 948 - HC - VAT and Sales TaxRefusal to issue necessary C-Form under Section 8 of the CST Act, 1956 - purchase of high speed diesel from outside the State of Maharashtra for use in machinery, which in turn is used for mining - grievance of the Petitioner is that there is no authority with Respondent No.3 or any officer of the State Tax under the CST Act to reject the application for C-Form filed by a dealer - HELD THAT - If the mere declaration by a Petitioner that he is carrying out mining activities is prima facie not found to be acceptable, then it is not necessary for the Sales Tax Authorities to first issue C-Form and then start an inquiry - In such circumstances, it would inquire into the correctness of the Petitioner s claim, however, the same should be done expeditiously as delay in issuing C-Form lead to increase in costs for the Petitioner. It is, in these circumstances, that it would be appropriate that Respondent No.3 would hear the Petitioner before taking view on the eligibility of the Petitioner for the C-Form as claimed by them. Petition disposed off.
Issues:
Challenge to refusal of issuing C-Form under CST Act based on withdrawal of Trade Circular. Analysis: The petition challenges the refusal of the Deputy Commissioner of State Tax to issue a C-Form under Section 8 of the CST Act due to the withdrawal of Trade Circular No. 47T of 2017. The petitioner, engaged in mining activities, purchased high-speed diesel from outside Maharashtra. The earlier circular allowed C-Form issuance for such purchases, but it was withdrawn. The Deputy Commissioner cited Section 10(10) of the Maharashtra VAT Act, making Trade Circulars binding, as the reason for rejection. The petitioner argues that once registered under the CST Act, a dealer can purchase goods from other states defined under Section 2(d) of the CST Act, obligating the issuance of C-Form. The petitioner can be penalized if the goods are not used for the intended purpose. Reference was made to the decision in VVF (India) Ltd. vs. State of Maharashtra and the Kerala High Court case in Colourgraphs vs. Sales Tax Officer, emphasizing the need to set aside the Deputy Commissioner's order and direct the issuance of C-Form. The State's Special Counsel concedes that the Deputy Commissioner's communication is non-speaking and withdrawal of a beneficial circular does not automatically negate available benefits under the Act. The State argues that the petitioner is not engaged in mining as defined by the Mines and Minerals Act. The court suggests an expeditious inquiry into the petitioner's claim before issuing the C-Form to avoid increased costs. The court directs the Deputy Commissioner to hear the petitioner's submissions and decide on the C-Form issuance by a specified date. The decision should be independent of the prima facie view expressed in the affidavit by the Joint Commissioner. The petitioner must address the Revenue's objections raised in the affidavit, and the Deputy Commissioner should inform the petitioner of any other grounds for rejecting the C-Form application. In conclusion, the court disposes of the petition, emphasizing the need for an independent decision by the Deputy Commissioner on the C-Form issuance, separate from the prima facie view expressed in the affidavit. The petitioner's objections must be addressed, and any further grounds for rejection should be communicated and discussed with the petitioner.
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