2020 (9) TMI 48 - HC - VAT and Sales Tax

Maintainability of petition - exemption from payment of Sales-tax on sale of Finished Products - Notification-S. O. No.478 S.O.No. 479 both dt. 22.12.1995 - HELD THAT - This issue can be agitated by the petitioner first with the appropriate authority and thereafter before the appropriate forum in accordance with law. Petition disposed off.

Summary

Issues involved:
Prayer for declaration regarding provisions of Bihar Value Added Tax Act, 2005, denial of benefits to Industrial Units, arbitrary provisions, repeal of rights, promissory estoppel, tax levied on products, non-implementation of VAT in Jharkhand, restraining Sales-tax Authorities from raising demands, discriminatory deferment option.

Analysis:

1. Declaration of Rights under Bihar Value Added Tax Act, 2005:
The petitioner sought declarations regarding the provisions of the Bihar Value Added Tax Act, 2005, stating that these provisions should not nullify vested rights accrued for exemption from sales tax on finished products. The court considered the issue of denial of benefits to industrial units and the arbitrary nature of certain sections of the Act. The petitioner also argued against the repeal of rights and privileges acquired under previous legislation. The court acknowledged the arguments but noted that the petition had become infructuous due to changes in the law. However, the court granted liberty to the petitioner to raise the issue with the appropriate authority and forum.

2. Taxation on Products and Discrimination:
The petitioner raised concerns about taxation on products and alleged discrimination, claiming that they were being singled out compared to other industrial units enjoying exemptions. The court acknowledged the petitioner's grievances but emphasized that such issues should be addressed through the appropriate channels. The court granted liberty to the petitioner and similarly situated individuals to approach the authorities with their concerns, expecting a prompt and lawful resolution within three months.

3. Non-Implementation of VAT and Tax Liability:
The petitioner argued that due to the non-implementation of VAT in Jharkhand and based on a Supreme Court judgment, they should not be liable to pay tax on the purchase of raw materials from Jharkhand. The court did not provide a specific ruling on this issue in the judgment, as the petition was deemed infructuous. However, the petitioner was granted liberty to pursue this matter through the appropriate legal avenues.

4. Restraining Sales-Tax Authorities and Deferment Option:
The petitioner sought relief from the respondents, Sales-tax Authorities, to prevent the raising of tax demands on the sale of their products by dealers. Additionally, the petitioner challenged the deferment option provided under the Act as arbitrary and discriminatory. The court did not provide a direct ruling on these specific issues in the judgment but granted liberty to the petitioner to seek appropriate remedies through the legal process.

In conclusion, while the petition was disposed of due to changes in the legal landscape, the court acknowledged the petitioner's concerns regarding taxation, discrimination, and benefits under the Bihar Value Added Tax Act, 2005. The judgment emphasized the importance of addressing such grievances through the proper legal channels, granting the petitioner liberty to pursue their claims in accordance with the law.