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Showing 41 to 60 of 389 Records
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1999 (5) TMI 599
Issues Involved:
1. Applicability of Article 285 of the Constitution of India.
2. Liability of the appellant company to pay non-agricultural assessment under the Andhra Pradesh Non Agricultural Lands Assessment Act, 1963.
3. Principle of promissory estoppel against the State Government.
4. Retrospective application of amendments made by Act 28 of 1974.
Summary:
1. Applicability of Article 285 of the Constitution of India:
The appellant company contended that as a government company wholly owned by the Union of India, its property should be exempt from state taxation u/s Article 285(1) of the Constitution. The Supreme Court rejected this argument, stating that a company registered under the Companies Act is a distinct legal entity separate from its shareholders, even if wholly owned by the Union of India. Therefore, Article 285 does not apply to the appellant company.
2. Liability of the appellant company to pay non-agricultural assessment:
The Andhra Pradesh Non Agricultural Lands Assessment Act, 1963, as amended by Act 28 of 1974, includes lessees of land owned by the Central or State Government for commercial, industrial, or other non-agricultural purposes within the definition of "owner." The appellant company, being a lessee of the Department of Atomic Energy, falls within this definition and is liable to pay non-agricultural assessment u/s 3 of the Act. The High Court's decision to levy the assessment was upheld, with the clarification that the assessment could only be levied on land actually used for specified non-agricultural purposes.
3. Principle of promissory estoppel against the State Government:
The appellant company argued that the State Government was estopped from levying the assessment based on a 1967 letter promising tax exemption. The Supreme Court dismissed this argument, stating that there can be no estoppel against a statute. Additionally, the letter only promised exemption for units run by the Government of India in the public sector, not for separate legal entities like the appellant company.
4. Retrospective application of amendments made by Act 28 of 1974:
The amendments made by Act 28 of 1974 have no retrospective effect. Therefore, no demand for non-agricultural assessment could be made for any period prior to 12th July 1974. The demands for periods before this date were quashed. For demands subsequent to 12th July 1974, the appellant companies were allowed to file appeals to establish the actual extent of land used for non-agricultural purposes and the applicable rate.
Conclusion:
The appeals were partially allowed. The demands for non-agricultural assessment prior to 12th July 1974 were quashed. For subsequent periods, the appellant companies were permitted to file appeals to determine the extent of land used for non-agricultural purposes and the applicable rate. No order as to costs.
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1999 (5) TMI 598
Issues involved:
The issues involved in this case include the violation of principles of natural justice by the State of Haryana, the termination of a mining lease, the restoration of the lease by the learned Single Judge without further inquiry, and the subsequent appeal by Sahi Ram challenging the restoration of the lease.
Violation of Principles of Natural Justice:
The respondent filed a writ petition challenging the revisional order of the Central Government under section 30 of the Mines & Mineral Act, 1957, which terminated the mining lease granted to the appellant. The learned Single Judge held that the State of Haryana violated principles of natural justice by not providing adequate notice to the respondent before terminating the lease. However, instead of remitting the matter back to the State of Haryana, the learned Judge restored the lease without directing further inquiry, which was confirmed in the LPA.
Appeal by Sahi Ram:
Sahi Ram, who was granted a lease of major mineral during the proceedings, filed an appeal contending that the respondent was guilty of severe breaches, and the orders of the State Government and the Central Government were correct. Arguments were presented by both parties' counsels, and it was suggested that the matter should be referred back to the Central Government for a fresh show cause notice to be issued to the respondent.
Fresh Show Cause Notice by Central Government:
The Supreme Court directed the Central Government to issue a fresh show cause notice to the respondent within six weeks, outlining all factual material relied upon in the cancellation order of the State of Haryana and the revision order of the Central Government. The notice should also be accompanied by copies of all relevant documents. The Central Government was instructed to allow the appellant, Sahi Ram, to file objections and give a hearing to both parties before passing a reasoned order within four months.
Decision and Further Proceedings:
The Central Government was tasked with determining whether the breaches and irregularities were committed by the respondent or another party. After the Central Government's decision, the aggrieved parties could file objections in the Court. The matter was listed for further proceedings on a specified date, with the status quo to be maintained until then.
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1999 (5) TMI 597
Issues Involved:
1. Confiscation of crates and bottles of aerated waters.
2. Confiscation of cash seized.
3. Levy of Central Excise duty on clandestinely removed aerated waters.
4. Imposition of penalty under various Central Excise Rules.
5. Confiscation of land, building, plant, and machinery.
Summary:
1. Confiscation of crates and bottles of aerated waters:
The adjudicating authority found that the non-entry in the RGI register after 25-9-1993 was a technical violation and did not warrant confiscation of the 385 crates seized from the factory on 28-9-1993. The 1400 crates seized on 30-9-1993 were accounted for in the RGI register, and since the goods had not left the factory, they were not intended for clandestine removal. The 3387 crates seized on 30-9-1993 were also not liable to confiscation.
2. Confiscation of cash seized:
The cash amounting to Rs. 3,46,493/- seized on 28-9-1993 was found to be accounted for in the books of the assessees, as certified by M/s. Kamal & Co., Chartered Accountant. Therefore, the cash could not be taken as representing sales proceeds of non-duty paid aerated waters and was not liable to confiscation.
3. Levy of Central Excise duty on clandestinely removed aerated waters:
The demand of Rs. 7,33,36,132/- was based on the difference between sales figures recorded in the RGI register and those reflected in the computer printouts of M/s. PEL. The adjudicating authority found that the figures in the computerised sheets were not reliable due to lack of corroborative evidence, inconsistencies in statements, and the absence of higher electricity consumption or extra sales proceeds. Thus, the demand of Rs. 4,72,51,048/- was dropped.
4. Imposition of penalty under various Central Excise Rules:
The Commissioner imposed a penalty of Rs. 65 lakhs on the assessees for not accounting for certain quantities of NABB in their records. However, the adjudicating authority accepted the explanation for the drainage of some units of NABB and found that the loss of concentrates was real. The assessees' appeal against the confirmation of part of the duty demand and the imposition of penalty was allowed, and the duty demand and penalty were set aside.
5. Confiscation of land, building, plant, and machinery:
The show cause notice also proposed confiscation of land, building, plant, and machinery under Rule 173Q(2), but the judgment does not provide specific details on this issue, implying that it was not upheld.
Conclusion:
The appeal of the Revenue was rejected, and the appeal of the assessees was allowed, setting aside the duty demand and penalty.
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1999 (5) TMI 596
Issues Involved:
The issues involved in this case are the validity of a settlement order passed under the Orissa Estates Abolition Act, 1951, the power of review/recall of orders by the authorities, and the jurisdiction of the O.E.A. Collector in settling land disputes.
Validity of Settlement Order:
The respondent, a deity, obtained a settlement order for certain lands under the Orissa Estates Abolition Act, 1951, which achieved finality as no appeal was filed against it. Subsequently, appellants sought a review of the settlement order based on procedural irregularities. The Additional District Magistrate remanded the case, citing non-compliance with statutory provisions. However, the High Court set aside the review order, emphasizing that the power to review was not vested in the O.E.A. Collector. The Supreme Court upheld the High Court's decision, noting that the review sought did not fall under the Act's provisions for review.
Power of Review/Recall:
The Act only provides for review under Section 38A for clerical or arithmetical mistakes. The O.E.A. Collector's attempt to recall the settlement order was challenged, leading to a discussion on the inherent power of courts to recall orders under specific circumstances, such as fraud, mistake, or lack of jurisdiction. The Court clarified that lack of jurisdiction renders proceedings null and void, while errors in jurisdiction require proper legal challenge.
Jurisdiction of O.E.A. Collector:
The appellants' challenge to the settlement order was primarily based on the alleged improper service of notice, not lack of jurisdiction. The High Court found that the notice was issued, albeit with missing pages, and the O.E.A. Collector had jurisdiction to settle the matter. The Court emphasized that even if the settlement application was filed beyond the prescribed time, it did not render the order without jurisdiction. The O.E.A. Collector's order was set aside as lacking jurisdiction, and the Supreme Court affirmed this decision, highlighting the importance of distinguishing between lack of jurisdiction and mere errors in exercising jurisdiction.
In conclusion, the Supreme Court dismissed the appeal, affirming the High Court's decision to set aside the O.E.A. Collector's order as lacking jurisdiction and clarifying the grounds for recalling orders based on lack of jurisdiction, fraud, or mistakes prejudicing parties.
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1999 (5) TMI 595
Issues:
1. Denial of appointment based on caste verification by the Scrutiny Committee.
2. Refusal of appointment due to expiration of the panel of selected persons.
3. Contention regarding the legality of denying appointment to a duly-selected candidate.
Analysis:
1. The appellant, a Scheduled Tribe candidate selected for the post of Assistant Personnel Officer, was denied employment based on the opinion of the Caste Scrutiny Committee that he did not belong to the Halba caste. The High Court, in a writ petition, determined that the appellant indeed belonged to the Halba caste and directed the employer to consider his appointment. However, the employer refused to appoint him citing the expiration of the panel of selected persons. The Court held that the appellant's right to appointment cannot be denied based on the expired panel, especially when the initial denial was due to the employer's erroneous decision, which was later overturned by the High Court.
2. The appellant's counsel argued that once the High Court reversed the decision of the screening committee and confirmed the appellant's caste status, the appellant's right to appointment should not be affected by the expiration of the panel or the appointment of someone else. The Court agreed with this argument, emphasizing that the appellant's selection was valid, and the denial of appointment was unjust due to the employer's mistake. The Court held that the appellant's right to the post cannot be taken away, and ordered the Maharashtra State Electricity Board to appoint him within two months, clarifying that the appointment would be prospective.
3. The Board's counsel contended that there was no violation of the Court's direction as the appellant had filed a contempt petition which was later dropped. However, the Court found merit in the appellant's argument that the denial of appointment was unlawful, and the appellant's right to the post should be upheld. The Court emphasized that the denial was not due to any fault of the appellant but was a result of the employer's erroneous decision. Therefore, the Court set aside the High Court's judgment and directed the Board to appoint the appellant to the post he was selected for, within a specified timeframe.
In conclusion, the Supreme Court allowed the appeals, emphasizing the importance of upholding the rights of duly-selected candidates and ensuring that denials of appointment are not based on erroneous decisions or technicalities like the expiration of selection panels.
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1999 (5) TMI 594
Issues Involved:
1. Validity of Section 3 of the Prevention of Corruption Act, 1988.
2. Validity of the notification dated 30-4-1997 by the State Government.
3. Legality of the notification dated 5-2-1999 by the Central Government.
4. Locus standi of the Advocate General of Tamil Nadu.
5. Validity of the Writ Petition by Shri M.A. Chinnaswamy.
Summary:
Issue 1: Validity of Section 3 of the Prevention of Corruption Act, 1988
The appellants challenged Section 3 of the Prevention of Corruption Act, 1988, arguing that it confers unguided and arbitrary discretion on the Government to appoint Special Judges "for such case or group of cases," violating Articles 14 and 21 of the Constitution. The Supreme Court upheld the High Court's decision, stating that the object and scheme of the Act provide sufficient guidelines for exercising the power under Section 3. The Court found that the discretion conferred upon the Government is not unfettered or unguided, and thus, Section 3 is constitutionally valid.
Issue 2: Validity of the Notification dated 30-4-1997 by the State Government
The notification dated 30-4-1997 established three additional Courts in Chennai and appointed Special Judges to try cases exclusively on a day-to-day basis under the Prevention of Corruption Act. The appellants argued that this was done with mala fide intentions to target political opponents. The Supreme Court rejected this contention, agreeing with the High Court that the material on record justified the establishment of additional Courts and that the allegations of mala fide were vague and unsubstantiated. The Court found that the notification was issued after due consultation with the High Court and was not violative of Articles 14, 21, and 235 of the Constitution.
Issue 3: Legality of the Notification dated 5-2-1999 by the Central Government
The Central Government issued a notification on 5-2-1999, appointing additional Special Judges for Chennai, arguing that it had the exclusive power to specify which cases shall be tried by which Special Judge when there are more Special Judges than one for any area. The Supreme Court held that the Central Government failed to establish the necessity for issuing the notification and that it was uncalled for at that stage. Therefore, the notification dated 5-2-1999 was quashed and set aside.
Issue 4: Locus Standi of the Advocate General of Tamil Nadu
The Advocate General of Tamil Nadu filed a writ petition challenging the notification dated 5-2-1999 issued by the Central Government. The respondents questioned his locus standi, arguing that he filed the petition not in his personal capacity but as the Advocate General, without authorization from the State Government. The Supreme Court did not entertain the writ petition filed by the Advocate General but permitted him to assist the Court as an intervenor.
Issue 5: Validity of the Writ Petition by Shri M.A. Chinnaswamy
The Supreme Court dismissed the writ petition filed by Shri M.A. Chinnaswamy, stating that it did not deserve to be entertained.
Conclusion
The Supreme Court dismissed the appeals challenging the validity of Section 3 of the Prevention of Corruption Act and the notification dated 30-4-1997 by the State Government. However, the Court allowed the appeal filed by VOICE, quashing the notification dated 5-2-1999 issued by the Central Government. The writ petitions filed by the Advocate General of Tamil Nadu and Shri M.A. Chinnaswamy were disposed of accordingly.
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1999 (5) TMI 593
Issues Involved:
1. Whether the learned Magistrate can discharge an accused after taking cognizance of an offence but before the trial.
2. Whether the learned Magistrate was right in discharging the appellants on the grounds that the complaint was barred by limitation u/s 468 Cr.P.C.
Summary:
Issue 1: Discharge of Accused After Taking Cognizance
The court examined Section 239 Cr.P.C., which mandates that a Magistrate must discharge the accused if, after considering the police report, documents u/s 173 Cr.P.C., and any necessary examination of the accused, and after hearing both parties, the Magistrate finds the charge to be groundless. The Magistrate must record reasons for such a decision. Section 239 must be read with Section 240 Cr.P.C., which allows the framing of charges if there is prima facie evidence. The court concluded that if the Magistrate finds the charge to be groundless or the cognizance itself was contrary to law (e.g., barred by limitation u/s 468 Cr.P.C.), the Magistrate can discharge the accused at the stage of framing the charge.
Issue 2: Barred by Limitation u/s 468 Cr.P.C.
The court discussed Chapter XXXVI of the Cr.P.C., which deals with the limitation for taking cognizance of certain offences. Section 468 Cr.P.C. bars taking cognizance after the expiry of the limitation period, which is defined based on the severity of the offence. Section 473 Cr.P.C. allows for the extension of this period if the delay is properly explained or if it is necessary in the interests of justice. The court noted that the essence of the offence u/s 498-A IPC is cruelty, a continuing offence, and each act of cruelty provides a new starting point for limitation. The last act of cruelty was on October 13, 1988, making the complaint filed on December 22, 1995, barred by limitation u/s 468(2)(c) Cr.P.C. However, the Magistrate did not consider Section 473 Cr.P.C., which could extend the limitation period in the interests of justice.
The court cited Vanka Radhamanohari vs. Vanka Venkata Reddy & Ors., emphasizing that courts should consider Section 473 Cr.P.C. for offences u/s 498-A IPC to ensure justice. The High Court was correct in setting aside the Magistrate's order regarding Section 498-A IPC but incorrect regarding Section 406 IPC, as no explanation for the delay was provided.
Conclusion:
The appeal was allowed in part. The Magistrate must reconsider the question of limitation for the offence u/s 498-A IPC, taking into account Section 473 Cr.P.C. and the interests of justice. The discharge order for Section 406 IPC was upheld.
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1999 (5) TMI 592
Inclusion of Claim whether the defendants are not liable to pay to the plaintiffs a sum of Rs.70,000/- in respect of the transport of Rice from Madras to Ronigunta from June to August 1979 objected
Held that:- In the normal circumstances, course of events as they are, this court would not have dealt with the matters as is being presently dealt with but as has been pointed out by the High Court itself that the matters have been dealt with upon consideration of the cause of justice and to sub-serve the need of justice, we also do deem it fit and proper that by reason of the factual situation in the matter, the High Court was not left with any option but to direct such a course of action more so by reason of an express ‘abandonment of right’ as noticed above. In the normal course of events if this particular clause 12 was not available in the contract between the parties the disputes in its entirety by reason of the scope and purview of the Arbitration Clause, could have been referred to arbitration and there would not have been any necessity for delving into a matter in the manner as we have, herein before, but it is by reason of the factum of incorporation of clause 12 and the subsequent abandonment thereof by reason of a decision to have the claim covered under clause 12 to be adjudicated by a forum different from that of the Senior Regional Manager, we also have no option left but to record our concurrence with the finding of the High Court that the fourth dispute being the subject matter of a civil suit initiated by the Food Corporation of India be also referred to arbitration. Be it noted that this order is passed in the peculiar facts and circumstances of the facts in issue and the issue as regards the excepted matters have not been delved into in detail excepting however as above.Appeal dismissed.
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1999 (5) TMI 591
Issues Involved:
1. Whether imported sugar has been declared to be goods of special importance and if so subject to the restrictions prescribed under the Central Sales Tax Act and article 286 of the Constitution of India?
2. Whether exemption granted to sugar produced and manufactured in India under serial number 3 of the Third Schedule to the Tamil Nadu General Sales Tax Act, 1959 by Tamil Nadu Amendment Act 3 of 1994 with effect from August 11, 1993, thus imposing tax on imported sugar is violative of articles 14, 301 and 304 of the Constitution of India?
Detailed Analysis:
Issue 1: Declaration of Imported Sugar as Goods of Special Importance
The petitioner, a company engaged in the export and import of sugar, contested the imposition of sales tax on imported sugar, arguing that it should be exempt as it is declared as goods of special importance under section 14(viii) of the Central Sales Tax Act, 1956. The core of the dispute was whether imported sugar falls under the specific sub-headings mentioned in section 14(viii) of the Central Sales Tax Act, which includes sub-headings 1701.20, 1701.31, 1701.39, and 1702.11 of the Central Excise Tariff Act, 1985.
The Tribunal examined the legislative history and the specific sub-headings under the Central Excise Tariff Act. It was noted that the term "sugar" under section 14(viii) is limited to specific types of sugar as classified under the sub-headings. The Tribunal emphasized the importance of the word "covered" in section 14(viii), indicating that only the sugars falling under these specific sub-headings are declared goods of special importance.
The Tribunal concluded that the imported refined sugar from Thailand did not fall under any of the specified sub-headings in section 14(viii) of the Central Sales Tax Act. Consequently, the imported sugar could not be classified as goods of special importance, and thus, the state's imposition of sales tax on imported sugar was upheld.
Issue 2: Violation of Articles 14, 301, and 304 of the Constitution of India
The petitioner argued that the exemption granted to domestically manufactured sugar under serial number 3 of the Third Schedule to the Tamil Nadu General Sales Tax Act, 1959, while imposing tax on imported sugar, was discriminatory and violative of articles 14, 301, and 304 of the Constitution of India.
The Tribunal noted that the exemption for domestically manufactured sugar was a policy decision by the state legislature, which did not extend to imported sugar. The Tribunal referenced previous judgments, including the decision of the Second Bench of the Special Tribunal in Mohd. Zackria v. State of Tamil Nadu, which supported the view that different treatment for imported and domestically manufactured sugar was permissible.
The Tribunal also highlighted that the petitioner's counsel conceded not to argue the invalidity under articles 301 and 304 of the Constitution. Therefore, the Tribunal found no violation of constitutional provisions in the differing tax treatment of imported sugar.
Conclusion:
The Tribunal dismissed both petitions, holding that imported sugar is not declared as goods of special importance under section 14(viii) of the Central Sales Tax Act, and the tax exemption for domestically manufactured sugar does not violate constitutional provisions. The petitioner was advised to challenge the assessment order dated September 16, 1998, through a regular statutory appeal on points not decided by the Tribunal. All interim orders were vacated.
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1999 (5) TMI 590
The High Court of Madhya Pradesh upheld the Board of Revenue's decision that mineral turpentine oil sold as a thinner should be taxed at 12% under the residuary entry instead of 16%. The penalty imposed on the dealer was also justified. The Court ruled that no referable question arose in the matter as it was already settled law. The reference was answered in the affirmative.
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1999 (5) TMI 589
Issues:
- Whether the Indian Oil Corporation sells cylinders to consumers when dealers accept refundable security deposits?
- Whether the levy imposed on the petitioner by the Assessing Authority should be quashed?
- Whether the orders passed by the appellate and revisional authorities should be set aside?
- Whether the transaction of supplying gas cylinders constitutes a "sale" or bailment?
- Whether the right to use cylinders is transferred for a valuable consideration when security deposits are accepted?
- Whether the petitioner's financial position affects the decision on merits?
Analysis:
1. The primary issue in this case is whether the Indian Oil Corporation sells cylinders to consumers when dealers accept refundable security deposits. The petitioner argued that there is no sale of cylinders as the security deposit is not a valuable consideration and no property in the goods is transferred to the consumer. The petitioner sought to quash the levy imposed by the Assessing Authority and set aside the orders of the appellate and revisional authorities.
2. The respondents contended that the supply of gas cylinders constitutes a sale and not bailment. They argued that the transaction amounts to a sale within the meaning of the Haryana General Sales Tax Act, 1973. The court considered the definition of "sale" under Section 2(1) and whether the right to use cylinders is transferred for a valuable consideration when security deposits are accepted.
3. The court analyzed the concept of "sale" and noted that it typically involves a transfer of property in goods. The court referred to precedents where the transfer of the right to use goods for valuable consideration was considered a sale. However, in the present case, the court found that the cylinders were merely a mode for carrying gas, and the security deposit was less than the cost price, allowing consumers to seek a full refund without deductions.
4. The court distinguished the present case from a precedent involving hire charges for cylinders, emphasizing that the petitioner only collected refundable security without any hire charges. The court rejected the contention that purchasing cylinders on the strength of C forms implied selling the containers, clarifying that the cylinders were used as containers for supplying gas.
5. Ultimately, the court found that the claim made by the respondents that the transaction amounted to a sale was not tenable. The court allowed the writ petition, setting aside the order of assessment and rendering the orders of the appellate and revisional authorities redundant. The court made no order as to costs, concluding the judgment in favor of the petitioner.
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1999 (5) TMI 588
Issues:
1. Eligibility for sales tax exemption under rule 28-A of the Haryana General Sales Tax Rules, 1975.
2. Interpretation of the term "commercial production" in the context of the rule.
3. Timeliness of the application for exemption and its impact on eligibility.
Analysis:
1. The petitioner-company, in collaboration with M/s. YTONG International, Germany, established a unit for manufacturing building materials. The unit's total cost was Rs. 40 crores, primarily using flyash from Badarpur Thermal Plant, Delhi. The company applied for sales tax exemption under rule 28-A of the Haryana General Sales Tax Rules, 1975. The application was considered by the Higher Level Screening Committee, which noted that the unit began commercial production on October 10, 1992, but the exemption application was submitted on September 9, 1993, beyond the 90-day limit from the start of commercial production. Consequently, the exemption was denied by the committee and the appellate authority. The court upheld these decisions, emphasizing the mandatory nature of the 90-day application timeline and the lack of provisions for condonation of delay.
2. The court addressed the interpretation of "commercial production" in the context of rule 28-A. While the term was not explicitly defined in the Rules, the court explained that it signifies when a unit starts selling its products in the market. The distinction between trial production and commercial production was highlighted, with the latter being marked by the sale of products. The court clarified that the moment the unit issues its first sale voucher, it enters commercial production. Therefore, the application for exemption must be filed within 90 days from this date to be considered timely. The court rejected the petitioner's argument that exemption could be claimed from the 90 days preceding the application date, emphasizing the importance of adhering to the prescribed timeline.
3. The court emphasized the significance of timely filing the exemption application under rule 28-A. It reiterated that the 90-day limitation period is mandatory, with no provision for extending or waiving the deadline. As the petitioner's application was submitted significantly after the 90-day window following the start of commercial production, the court affirmed the rejection of the exemption request by the authorities. The judgment concluded that the petitioner's delay in filing the application rendered it ineligible for sales tax exemption, leading to the dismissal of the writ petition challenging the denial of exemption.
In summary, the court's decision centered on the strict adherence to the 90-day timeline for filing sales tax exemption applications from the start of commercial production, emphasizing the significance of timely compliance with statutory requirements to avail of benefits under rule 28-A of the Haryana General Sales Tax Rules, 1975.
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1999 (5) TMI 587
Issues:
Classification of goods under tax schedule - Machinery parts or electronic systems.
Analysis:
The case involved a dispute between the Revenue and the assessee regarding the classification of goods for tax purposes. The assessee, a dealer in card auto levellers and spares used in the textile industry, claimed the goods as machinery parts and paid tax at 8 per cent under entry 81 of the First Schedule. The assessing authority, however, classified the goods as an "electronic system" taxable at 12 per cent under entry 41-C of the First Schedule based on the components used.
Before the Appellate Assistant Commissioner, the assessee argued that the goods were machinery parts exclusively for the textile industry and not electronic systems. The Appellate Assistant Commissioner reversed the assessing authority's decision citing that the goods were not specifically mentioned under entry 41-C, and previous decisions supported the contention that the goods were accessories of textile machinery. The Appellate Tribunal upheld this decision, emphasizing that the goods could only be used in textile machinery, thus falling under entry 81 as machinery parts.
The Tribunal noted that if the goods could be classified as electronic systems and used independently or in various machinery, they would fall under entry 41-C. However, since the goods were specific to textile machinery and could not function independently, they were deemed as machinery parts falling under entry 81. Citing relevant precedents, including a Supreme Court decision, the Tribunal concluded that the goods in question were accessories of machineries in the textile industry, thereby dismissing the tax revision case filed by the Revenue.
In summary, the judgment clarified the classification of goods for tax purposes, highlighting the distinction between machinery parts and electronic systems based on functionality and specific use in a particular industry. The decision relied on legal precedents to support the classification of the goods as machinery parts under entry 81 of the tax schedule, ultimately ruling in favor of the assessee and dismissing the Revenue's petition.
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1999 (5) TMI 586
Issues:
Levy of penalty under section 15-A(1)(o) of the U.P. Trade Tax Act, 1948 for non-accompaniment of form XXXI with a consignment.
Analysis:
The revision petition challenged the order of the Trade Tax Tribunal dismissing the dealer's appeal against the penalty of Rs. 1,37,064 imposed under section 15-A(1)(o) of the Act for the assessment year 1995-96. The consignment of goods detained due to the absence of form XXXI was being sent to the dealer's location. The consignor's objection that the goods were supplied in accordance with an order, supported by a form XXXI sent by the purchaser, was initially accepted by the Assistant Commissioner, leading to the cancellation of the penalty. However, the assessing officer of the dealer initiated penalty proceedings, upholding the penalty citing the dealer's obligation to ensure all necessary documents accompanied the consignment.
The penalty was imposed solely due to the absence of form XXXI with the consignment. The consignor's responsibility to supply goods at the purchaser's place was acknowledged in earlier proceedings. The dealer's explanation that the default lay with the consignor, who failed to deliver form XXXI despite receiving it from the purchaser, was not accepted by the Trade Tax Officer. Section 28-A of the Act outlines obligations for importers, requiring the dealer to furnish form XXXI to the consignor, which was done in this case. The statutory provisions support that the dealer should not be penalized if the consignor fails to comply with document requirements.
The High Court emphasized that the consignor, as the actual importer bringing goods into the state, was responsible for ensuring compliance with transport regulations. The dealer, as the recipient, had fulfilled its obligation by providing form XXXI to the consignor. Observations regarding the consignor's conduct, such as delayed objections and failure to produce form XXXI promptly, were not grounds to penalize the dealer. The court concluded that the penalty on the dealer was unjustified, as the consignor was the party obligated to adhere to section 28-A requirements.
In light of the above analysis, the High Court allowed the revision petition, setting aside the Tribunal's order and quashing the penalty imposed on the dealer. The court ruled in favor of the dealer, emphasizing the consignor's primary responsibility for compliance with transport regulations and the dealer's fulfillment of its obligation to provide form XXXI.
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1999 (5) TMI 585
The Allahabad High Court dismissed a revision petition by the Commissioner of Trade Tax against an order deleting additional turnover assessed under section 21(2) of the U.P. Trade Tax Act. The Tribunal found no actual concealment of sales and concluded there was no escapement of turnover. The revision petition was dismissed with costs assessed at Rs. 1,500.
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1999 (5) TMI 584
Issues Involved:
1. Validity of the penalty demand notice dated February 15, 1999.
2. Validity of the interest demand notice dated December 17, 1998.
Issue-wise Detailed Analysis:
1. Validity of the Penalty Demand Notice Dated February 15, 1999:
The petitioner challenged the penalty demand notice issued by the Sales Tax Officer under sections 45 or 46 of the Gujarat Sales Tax Act, 1969. The petitioner contended that no assessment had been made to provide a foundation for any penalty demand, and no hearing was given before raising this demand. The Revenue conceded that no assessment order had been made so far and admitted that until the liability of the assessee to pay tax is determined, no demand by way of penalty could have been raised. Thus, the notice dated February 15, 1999, raising a demand of Rs. 2,92,47,252 by way of penalty was deemed premature and invalid.
2. Validity of the Interest Demand Notice Dated December 17, 1998:
The petitioner also challenged the interest demand notice issued under section 47 of the Gujarat Sales Tax Act, 1969. The petitioner argued that no assessment had been made to justify the demand for interest, and he was entitled to claim a refund for the tax paid under a mistake. The Revenue contended that under section 47(4A), the liability to pay interest on delayed payment of tax is automatic. However, the ultimate liability of interest can only relate to the ultimate assessment of tax in regular assessment proceedings.
The court examined the provisions of section 47, particularly sub-section (4A), which provides for charging interest for delayed payment of tax. It was noted that the petitioner had paid tax as per the declarations made under sub-sections (1), (2), and (3) of section 47. The court found that no liability to pay interest on the additional sum of tax required to be paid under sub-section (3) of section 47 is envisaged at that stage. Sub-clause (b) of sub-section (4A) applies only after the amount of tax has been assessed or reassessed, which had not occurred in this case. Sub-clause (c) of sub-section (4A) also could not be applied as it requires a previous demand of tax raised by the competent officer, which was not present.
The first proviso to section 47(4A) indicates that no interest shall be payable if the difference between the amount of tax assessed or reassessed and the amount of tax paid does not exceed ten percent. The court concluded that the liability of payment of interest could not arise except after framing of assessment and determining whether the assessed tax exceeds the prescribed limit from the tax paid. Therefore, the notice dated December 17, 1998, was found to be arbitrary and contrary to law.
Conclusion:
The court quashed the impugned notices dated December 17, 1998, and February 15, 1999, as they were found to be premature and not in accordance with the provisions of the Gujarat Sales Tax Act, 1969. The petition was allowed with no order as to costs.
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1999 (5) TMI 583
Issues Involved:
1. Claim of exemption on works contract disallowed and assessed to tax Rs. 2,21,209.23.
2. Levy of tax on motor control centre on a turnover of Rs. 55,562 at 9 percent instead of 6 percent.
Detailed Analysis:
1. Claim of Exemption on Works Contract:
The assessee contended that the contract with the Director of Sports and Youth Services was to manufacture and supply a swimming pool water purification plant on a turnkey basis, inclusive of erection and commissioning charges, and therefore, no sale was involved in the transaction. The Appellate Assistant Commissioner remanded the issue to the assessing authority for verification of the assessment records. However, the Joint Commissioner of Commercial Taxes, upon suo motu revision, observed that the agreement included sales tax and other duties in the bills, indicating an intention to sell materials and collect tax. The Joint Commissioner concluded that the turnover of Rs. 2,21,209.23 was taxable at 4 percent.
The Tribunal noted that the contract was treated as a sale of goods by both the assessee and the Director of Sports and Youth Services, as evidenced by the inclusion of sales tax in the contract price. The Tribunal referenced various case laws, including Vanguard Rolling Shutters & Steel Works v. Commissioner of Sales Tax and Sentinel Rolling Shutters & Engineering Company Pvt. Ltd. v. Commissioner of Sales Tax, to distinguish between a contract for sale of goods and a works contract. The Tribunal concluded that the contract in question was essentially for the sale of goods, with certain civil works being incidental to the contract of sale. Therefore, the Joint Commissioner rightly assessed the turnover as a sale of goods.
2. Levy of Tax on Motor Control Centre:
The assessee argued that the motor control centre was merely a fabricated box and not an electrical good, and thus should be taxed at 6 percent under item 81 of the First Schedule to the Act. The Appellate Assistant Commissioner had assessed the turnover at 6 percent. However, the Joint Commissioner of Commercial Taxes concluded that the motor control centre was an electrical switch box and assessed the turnover at 9 percent under item 41 of the First Schedule to the Act.
The Tribunal upheld the Joint Commissioner's conclusion, stating that the motor control centre was indeed an electrical switch box, and the levy of tax at 9 percent was appropriate.
Conclusion:
The Tribunal dismissed the tax appeal case, affirming the Joint Commissioner of Commercial Taxes' decision to treat the contract for the swimming pool water purification plant as a sale of goods and to levy tax on the motor control centre at 9 percent. The Tribunal emphasized that the contract was essentially for the sale of goods, with civil works being incidental, and the motor control centre was correctly classified as an electrical switch box.
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1999 (5) TMI 582
Whether the applicant’s stay in India in a year is less than 182 days, and the stay in four preceding years is less than 365 days hence, he is non-resident in India under section 6 of the Income-tax Act, 1961?
Whether the applicant would be entitled to be taxed at the lower rate of tax as per article 10-para. 2(b) and article 11-para. 2(b) of the said Double Taxation Avoidance Treaty at the rate of 15 per cent., on gross dividend income, arising in India (for dividend income prior to July 1, 1997) and at the rate of 12.5 per cent., on gross interest income on investment accruing and arising in India to the applicant from the investments made in debentures and bonds of Indian companies or any other interest income on loans/advances made out of his moneys from his Non-Resident External Account ?
Whether on the facts and in the circumstances of the case and having regard to the fact that the applicant is a resident of UAE in terms of article 4 of the said Double Taxation Avoidance Treaty, gains arising on sale/transfer of his movable properties would be taxable only in the UAE and not in India as per article 13-para. 3 of the said DTA ?
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1999 (5) TMI 581
Whether the appellant is right in contending that the arbitration clause 39 in the main agreement did not permit the arbitrator to deal with the disputes relating to the Interior Design Agreement which contained a different arbitration clause and whether the award, in respect of the Interior Design Agreement was void?
Whether the appellant who did not raise any question of jurisdiction under Section 16 of the Act in relation to the disputes under the Interior Design Agreements, could have raised a question of jurisdiction of the arbitrator or of his power to deal with issues arising under the said Agreements at the stage of section 34?
Whether an arbitrator is not entitled to pass an award directing specific performance of an agreement of sale and the subject matter of the dispute is not capable of arbitration under section 34(2)(b)(i) of the Act?
Whether the appellant could question factual findings relating to default, time being essence, readiness and willingness etc. before the arbitrator under Section 34 of the Act?
Held that:- Appeal dismissed. we do not think it necessary to decide this question in view of the fact that though Section 16 was referred to during the course of the hearing, the learned senior counsel for respondents had argued on merits that the arbitrator had Jurisdiction to decide the disputes/differences concerning the Interior Design agreements also and that even if the appellant could be permitted to raise these issues at the stage of Section 34, there was no substance in the said contentions.
There are several items in Schedule E of the main agreement which overlap the items in Schedule A of the Interior Design Agreement. In view of the overlapping, in our opinion it has to be said that several items in the Schedule A of the Interior Design Agreement are in modification/substitution of the items in the Main Agreement. Therefore the coverage of the two agreements makes it clear that the execution of the Interior Design Agreement is ‘connected with’ the execution of the main Agreement. It may also be noted that the date of the main agreement and the Interior Design Agreement is the same in each of the three cases and clause 3 of the Interior Design Agreement states specifically that ‘the work of the said renovation, designing and installation shall commence from the execution thereof’ which means that the execution of the Interior Design agreement and the main agreement is to be simultaneous.
We hold on Point 3 that disputes relating to specific performance of a contract can be referred to arbitration and Section 34(2)(b)(i) is not attracted. We overrule the view of the Delhi High Court. Point 3 is decided in favour of respondents.
The Explanation to the provisions says that without prejudice to the generality of sub-clause (ii) of clause (b), it is declared for the avoidance of any doubt, that an award is to be treated as in conflict with the public policy of India if the making of the award was induced or affected by fraud, or corruption or was in violation of sections 75 or 81. Section 75 deals with confidentiality while section 81 deals with admissibility of evidence in other proceedings. We do not have any such situation before us falling within section 34(2)(b)(ii). The factual points raised in the case before us, to which we have referred to earlier, do not fall within Section 34(2)(b)(ii). Coming to Section 34(2)(b)(i) we have already held that the subject matter of the dispute is not incapable of settlement by arbitration under the law for the time being in force. Nor is any point raised that the arbitral award is in conflict with the public policy of India. We are, therefore, of the view that the merits of the award, on the facts of the case do not fall under Section 34(2)(b) of the Act. Appeal dismissed.
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1999 (5) TMI 580
Dishonor of cheque - Held that:- Appeal allowed. The date when the notice sent by Fax reached the drawer of the cheque the period of 15 days (within which he has to make the payment) has started running and on the expiry of that period the offence is completed unless the amount has been paid in the meanwhile. If no complaint was filed within one month therefrom the payee would stand forbidden from launching a prosecution thereafter, due to the clear interdict contained in Section 142 of the Act.
In this case the complainant has admitted the fact that written notice was sent by fax. Appellant has admitted its receipt on the same date. (It must be remembered that respondent has no case that fax has not reached the appellant on the same date). The last day when the respondent could have filed the complaint was 26-7- 1996. But the complaint was filed only on 8-8-1996 So the court has no jurisdiction to take cognizance of the offence on the said complaint.
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