2019 (12) TMI 844 - HC - VAT and Sales Tax

Rejection of rectification application - input tax credit on TDS amount - HELD THAT - The issue involved herein is more related to the factual aspects which necessarily requires to be adjudicated by the Appellate Authority. Moreover, the petitioner has not challenged the assessment order in the present proceedings. The endorsement issued by the respondent No.1 rejecting the rectification application filed under Section 69 1 of the Act is under challenge. It is well settled law that the scope of rectification is very limited. If the authority is satisfied that there is any mistake apparent from the record, the provisions of Section 69 can be invoked to rectify such mistake. Any mistake said to have been committed by the learned Chartered Accountant in filing VAT Form240 would not be construed as the mistake apparent from the record to attract Section 69 1 of the Act - Since the factual aspects involved in the case are analyzed and the certificate is issued by the learned Chartered Accountant, such mistakes, if any in the VAT Form 240 ought to have been brought to the notice of the prescribed authority at the time of the assessment proceedings. Indisputably, no such attempts have been made by the petitioner to seek rectification of the VAT Form 240 before the conclusion of the assessments by the prescribed authority. Section 69 1 of the Act would attract when there is any mistake from the record while concluding assessment proceedings by the Prescribed Authority, the Appellate Authority or Revising Authority. The petitioner is permitted to file the statutory appeal before the Appellate Authority. If such an appeal is preferred within a period of two weeks from the date of receipt of certified copy of the order, the same shall be considered by the Appellate Authority on merits without objecting to the period of limitation. Petition disposed off.

Summary

Issues involved:
Challenge to endorsement and garnishee proceedings by the respondent No.1, rectification application rejection under Section 69[1] of the Act, necessity of statutory appeal, stay on Garnishee notice.

Analysis:

1. The petitioner challenged an endorsement and garnishee proceedings issued by respondent No.1, seeking rectification of a mistake in Form VAT 240. The petitioner, a private limited company engaged in the business of coffee vending machines, claimed input tax credit on a deducted tax amount, which was denied by the Assessing Authority. The rectification application under Section 69[1] of the Act was rejected.

2. The petitioner argued that the prescribed authority failed to rectify the mistake apparent from the record in filing VAT Form 240. The Department proceeded with recovery proceedings despite the availability of an appeal against the rejection of the rectification application. The petitioner contended that the respondents were acting hastily in recovering the tax amount without awaiting the appeal period.

3. The Additional Government Advocate justified the orders, stating that disputed facts cannot be adjudicated under the writ jurisdiction. It was argued that the petitioner should exhaust the alternative statutory remedy of appeal before approaching the Court.

4. The Court acknowledged the Revenue's submissions, emphasizing that the issue involved factual aspects better suited for adjudication by the Appellate Authority. The petitioner had not challenged the assessment order, and the rejection of the rectification application was the primary issue in the present proceedings.

5. The Court highlighted the limited scope of rectification under Section 69 of the Act, emphasizing that mistakes by the Chartered Accountant in filing VAT Form 240 did not qualify as mistakes apparent from the record. It was noted that attempts to rectify such mistakes should have been made during the assessment proceedings.

6. The Court directed the petitioner to file a statutory appeal before the Appellate Authority within two weeks. It stayed the Garnishee notice until the Appellate Authority decides on the application seeking stay of the demand, subject to compliance with Section 63[4] of the Act.

7. With the given observations and directions, the writ petition was disposed of, and the original impugned orders were to be returned to the petitioner, with photocopies retained for record purposes.