2023 (8) TMI 1096 - HC - VAT and Sales Tax

Levy of Entry Tax on purchase turnover - purchase of iron steel from unregistered person - dispute relates to the assessment year 2013-14 - H ELD THAT - It is not in dispute that against the order of the Tribunal partly allowing the second appeal of the respondent, any revision has been has been preferred under the UP VAT Act. It is also not in dispute that while allowing the second appeal in part, the Tribunal has confirmed the levy of tax apart from purchases being made from outside the country as well as purchases made from outside the State of U.P. It is admitted between the parties that the tax levied by the Assessing Authority has been confirmed, which goes to show that the purchases from unregistered dealer have been confirmed upto the Tribunal. Once the said finding is not assailed by the respondent, the Tribunal was not correct in holding that the respondent has not made purchase of iron steel from unregistered dealer. The Tribunal, by the impugned order, has tried to blow hot cold at the same time. It may further be observed that the Tribunal, while recording the finding under the Entry Tax Act that the purchased have not been made from unregistered dealer by the respondent, has neither made any discussion, nor any material was brought on record to justify the said observation. The impugned order passed by the Tribunal is set aside to the extent that the levy of entry tax as assessed by the Assessing Authority is confirmed - revision allowed.

Summary

Issues Involved:
Challenge to order setting aside levy of entry tax under Uttar Pradesh Tax on Entry of Goods into Local Areas Act, 2007.

Comprehensive details of the judgment for each issue involved:

The revisionist challenged the order setting aside the levy of entry tax amounting to Rs. 5,00,000 on a purchase turnover of Rs. 1,00,00,000 under the Uttar Pradesh Tax on Entry of Goods into Local Areas Act, 2007. The revision was admitted based on the question of law regarding the justification of setting aside the levy when the turnover was upheld under the U.P. VAT Act. The dispute related to the assessment year 2013-14, where purchases from unregistered dealers were in question. The Assessing Authority had imposed tax under both the U.P. VAT Act and the Entry Tax Act due to purchases from unregistered dealers. Appeals were made against these orders, with the second appeal under the Entry Tax Act being allowed in full, leading to the challenge in the High Court.

The learned Additional Chief Standing Counsel argued that the Tribunal wrongly held that the respondent did not purchase iron & steel from an unregistered dealer under the Entry Tax Act, despite confirming such purchases under the U.P. VAT Act. The counsel contended that the Tribunal lacked justification in deleting the levy of entry tax without proper discussion or evidence. On the contrary, the counsel for the respondent supported the Tribunal's decision, emphasizing that purchases from outside the State and country were accepted, and there was no material to justify the levy of entry tax. The Tribunal's decision was upheld based on the lack of evidence supporting the levy of entry tax.

The Court observed that the Tribunal's decision was contradictory as it confirmed purchases from unregistered dealers under the U.P. VAT Act but held otherwise under the Entry Tax Act without proper discussion or evidence. The Tribunal's finding that no purchases were made from unregistered dealers lacked justification, especially when such purchases were confirmed in the U.P. VAT Act proceedings. Therefore, the Tribunal's order setting aside the levy of entry tax was deemed incorrect, and the revision was allowed, confirming the levy as assessed by the Assessing Authority.

In conclusion, the High Court set aside the Tribunal's order and upheld the levy of entry tax as assessed by the Assessing Authority, based on the confirmed purchases from unregistered dealers.