2024 (9) TMI 1407 - HC - VAT / Sales Tax

Waiver of tax under CST Act - difficulties in obtaining C-Forms - HELD THAT - A decision has been taken in regard to these issues by this Division Bench in SRI SRINIVASA RICE MILL VERSUS COMMERCIAL TAX OFFICER AND OTHERS 2024 (9) TMI 1316 - ANDHRA PRADESH HIGH COURT , where it was held that 'It would be inequitable, to grant relief to those dealers who approached in the year 2019 while denying such relief to the dealers who approached later. In any event, the applications are only for the purposes of ascertaining the eligibility of the dealers/petitioners for grant of waiver'. Following the above said Judgment, these Writ Petitions are disposed of with the following directions - 1. The Endorsements issued by the respective tax authorities are set aside. 2. The respective tax authorities, shall consider the applications of the petitioners afresh and grant waiver to those petitioners who are able to comply with the requirements of the documents set out in the memos. Petition disposed off.

Summary

Issues Involved:
1. Eligibility for waiver of tax under CST Act without C-Forms.
2. Validity of endorsements rejecting waiver applications.
3. Compliance with documentary requirements for waiver.
4. Re-assessment limitations under CSTAP Rules.
5. Timeliness of document submission for waiver.

Issue-wise Detailed Analysis:

1. Eligibility for Waiver of Tax Under CST Act Without C-Forms:
The petitioners, rice millers registered under the Central Sales Tax Act, 1956, sought a concessional tax rate of 2% without producing C-Forms, which are typically required to affirm that the goods would be consumed or resold by the purchasers in their respective states. The Government of Andhra Pradesh had issued memos (Memo No. 26197/CT-II(1)/2013, dated 10.05.2016, and Memo No. 26197/CT-II(1)/2013, dated 27.09.2016) allowing this waiver subject to certain conditions, including the production of alternative documents like lorry receipts, CST waybills, and proof of inter-state trade.

2. Validity of Endorsements Rejecting Waiver Applications:
The tax authorities rejected the petitioners' waiver applications on several grounds, primarily that the assessments for the relevant periods had been completed more than four years prior, thus re-assessment was not permissible under the CSTAP Rules. Additionally, the authorities noted that the necessary documents were submitted after the cutoff date of 30.09.2018, making them ineligible for consideration.

3. Compliance with Documentary Requirements for Waiver:
The memos issued by the Government stipulated that the waiver would be granted only if specific documentary evidence was provided, including lorry receipts, CST waybills, and proof of exit through the last notified check-post in Andhra Pradesh. The tax authorities found that in some cases, the petitioners failed to submit the required documents, leading to the rejection of their waiver applications.

4. Re-assessment Limitations Under CSTAP Rules:
The tax authorities cited Rules 14 (A) sub-rules 8, 9 & 15 of the Central Sales Tax (Andhra Pradesh) Rules, 1957, which do not permit re-assessment beyond four years from the date of the original assessment. This rule was a significant factor in the rejection of the waiver applications, as the assessments in question were completed more than four years prior to the petitioners' applications.

5. Timeliness of Document Submission for Waiver:
The petitioners submitted their waiver applications and supporting documents from the year 2019 onwards, well past the cutoff date of 30.09.2018 set by the Government memos. The tax authorities deemed these late submissions ineligible for consideration, resulting in the rejection of the waiver applications.

Judgment:
The Division Bench, referencing a prior decision in W.P.Nos.23966 of 2023 & Batch dated 07.08.2024, set aside the endorsements issued by the tax authorities. The Court directed the tax authorities to reconsider the petitioners' applications afresh, granting waivers to those who comply with the documentary requirements set out in the memos. This exercise is to be completed within two months from the date of receipt of the Order. Additionally, no coercive steps shall be taken against the petitioners based on the earlier assessment orders until a decision on the waiver is finalized. There were no orders as to costs, and any pending miscellaneous petitions were closed.