2024 (1) TMI 1154 - HC - VAT and Sales Tax

Maintainability of Revision application GVAT Tribunal - Cancellation of registration of the petitioner with retrospective effect - whether the Revision Application filed by the petitioner under Section 75(1)(b) of the VAT Act would be maintainable before the Tribunal when the order for cancellation of registration is passed by the Deputy Commissioner under Section 27(5)(i) of the VAT Act? - HELD THAT - It is also not in dispute that the Deputy Commissioner passed the order under Section 75(1)(a) of the VAT Act under the delegated powers of the Commissioner. That means, the Deputy Commissioner has exercised the powers of Commissioner under Section 75(1)(a) of the VAT Act. Therefore, considering the provision of Section 75(1)(b) of the VAT Act, any application made to the Tribunal against an order of the Commissioner is to be treated as Revision and would be maintainable before the Tribunal only. The Tribunal was not justified in holding that the Revision Application filed by the petitioner against the order passed by the Deputy Commissioner under Section 27(5)(i) read with Section 75(1)(b) of the VAT Act is not maintainable in view of provision of Section 73 of the Act because, as per Section 73, an Appeal of every original order not being an order mentioned in Section 74 passed under the Act is maintainable - In the facts of the case, the order passed by the Deputy Commissioner is not an original order but is a revisional order under Section 75(1)(a) of the VAT Act and therefore, Appeal under Section 73 would not be maintainable, but only Revision before the Tribunal under Section 75(1)(b) of the VAT Act would be maintainable. The impugned order passed by the Tribunal is hereby quashed and set aside and the matter is remanded back to the Tribunal for considering the Revision Application No. 59 of 2021 on merits - Petition allowed by way of remand.

Summary

Issues:
The issues involved in the judgment are the maintainability of Revision Application under Section 75(1)(b) of the VAT Act before the Tribunal and the jurisdictional error in rejecting the Revision Application.

Summary:

Issue 1: Maintainability of Revision Application under Section 75(1)(b) of the VAT Act before the Tribunal

The petitioner, a partnership firm engaged in trading, challenged the order of cancellation of registration under the VAT Act by the Deputy Commissioner. The Tribunal rejected the Revision Application citing that an Appeal under Section 73 would be maintainable instead. The petitioner argued that the Deputy Commissioner exercised suo motu powers under Section 75(1)(a) of the VAT Act, justifying the Revision Application under Section 75(1)(b). The Court found that the Deputy Commissioner acted under the Commissioner's delegated powers, making it a revisional order under Section 75(1)(a) and thus maintainable as a Revision before the Tribunal under Section 75(1)(b).

Issue 2: Jurisdictional Error in Rejecting the Revision Application

The Court held that the Tribunal erred in deeming the order of the Deputy Commissioner as an original order, making an Appeal under Section 73 not maintainable. The order was classified as a revisional order under Section 75(1)(a), rendering the Revision Application under Section 75(1)(b) appropriate. Consequently, the Court quashed the Tribunal's decision, remanding the matter back for consideration on its merits.

The judgment clarifies the distinction between Appeal and Revision under the VAT Act, emphasizing the importance of correct jurisdictional interpretation in tax matters.