2022 (11) TMI 433 - HC - VAT and Sales Tax

Application for condonation of delay - Power of review - maintainability of the review - HELD THAT - When it came to the power of review under sub-section (8) of S.s 60 62 sub-section (9) of S. 63, a larger time of one year i.e., 365 days was provided for institution without any provision for condonation of delay - The declaration in Hongo India (P) Ltd 2009 (3) TMI 31 - SUPREME COURT squarely applies in the above case, there can be no condonation of delay under Section 62 (8) of the KVAT Act. Suffice it to notice that the assessee claimed input tax credit for the raw materials purchased by its manufacturing unit at Vadavathur, Kottayam; for reason of the tyres manufactured having been exported from its godown at Puzhal in Tamil Nadu; to which godown the finished products were transferred from Vadavathur, on stock transfer. This Court, in the order sought to be reviewed, categorically held that there can be no such clarification granted by the authority without examination of the facts and without production of sufficient documents to prove that the taxable purchases made were in pursuance of an export order - The assessee having not established an export order prior to the stock transfer, it is obvious that there cannot be taxable purchases of raw materials having been made, based on an export order at its manufacturing unit at Vadavathur. There is no discovery of a new or important fact which after due diligence was either, not within the knowledge of the applicant or could not have been produced by the assessee, when the order was made - What is attempted by the petitioner is to have a clarification that the export made from their godown at Tamil Nadu is of the manufactured goods at Vadavathur, Kottayam, enabling the manufacturing unit to claim input tax credit within the State of Kerala, which blanket order cannot be made under the clarificatory power and the consideration has to be on the individual facts of every transaction with documentary evidence produced to substantiate a claim. The Review Petition stands rejected on the aspect of delay and on the ground of the review petition not coming within the contours of a review, as contemplated by the statute.

Summary

Issues:
1. Delay condonation and maintainability of review petition under Section 94 of the Kerala Value Added Tax Act, 2003.
2. Interpretation of provisions for condonation of delay under the KVAT Act in light of relevant legal precedents.
3. Merits of the case regarding input tax credit claim for exported goods and the requirement of specific documentary evidence.

Issue 1: Delay Condonation and Review Petition Maintainability:
The appeal in this case arises from an order issued under Section 94 of the Kerala Value Added Tax Act, 2003. The State contested the application for condonation of delay and the maintainability of the review petition filed 164 days late. The petitioner argued citing legal precedents, including the decision of the Hon'ble Supreme Court, to support the contention that the delay could be condoned. The State opposed, emphasizing the lack of new or important facts justifying the review and pointing to the limitations of the review jurisdiction under the KVAT Act.

Issue 2: Interpretation of Provisions for Delay Condonation:
The court analyzed the provisions of the KVAT Act in light of legal precedents such as Hongo India (P) Ltd and Dehar Power House Circle cases. It was highlighted that the Act provides for specific periods for filing appeals and revisions, with provisions for condonation of delay in certain instances. However, when it came to review petitions under the Act, a larger time period of one year was provided without any provision for condonation of delay. The court concluded that, based on the scheme of the KVAT Act, the principles laid down in the Hongo India (P) Ltd case applied, and there could be no condonation of delay under Section 62(8) of the KVAT Act for review petitions.

Issue 3: Merits of the Case - Input Tax Credit Claim:
Regarding the merits of the case, the appellant claimed input tax credit for raw materials purchased for goods exported from Tamil Nadu. The court observed that the appellant failed to establish that the purchases were based on an export order, especially considering the lack of clarity on the foreign buyer at the time of stock transfer and the absence of a specific export order for the stock transfer. The court noted that a blanket order for input tax credit could not be granted without proper examination of individual transactions and documentary evidence. Consequently, the review petition was rejected on the grounds of delay and failure to meet the statutory requirements for a review petition.

This detailed analysis of the judgment covers the issues of delay condonation, interpretation of legal provisions, and the merits of the case comprehensively, providing insights into the court's reasoning and application of legal principles in the context of the Kerala Value Added Tax Act.