2017 (9) TMI 197 - HC - VAT and Sales Tax

Levy of purchase tax - Sale of sugar and other allied products - The Excise and Taxation cum Designated officer Jalandhar while completing the assessment determined the purchase price of sugarcane for the purpose of levy of purchase tax at 4, 75, 60, 337/-. The appellant had declared the purchase price at 4, 66, 76, 828/- being the statutory minimum price fixed by the Government of India for the year under consideration - According to the appellant although the Assessing officer admitted availability of ITC at 20, 95, 351/- yet allowed ITC at 29, 964/-. The Assessing officer allowed net ITC at 1, 85, 875/- and created additional demand of 38, 85, 333/- inclusive of penalty under Section 53 of the PVAT Act at 16, 10, 307/- and interest under Section 32 of the PVAT Act at 4, 02, 576/- - Held that - similar issue decided in the case of THE MORINDA COOPERATIVE SUGAR MILL LTD MORINDA Versus STATE OF PUNJAB & ORS 2016 (9) TMI 1315 - PUNJAB AND HARYANA HIGH COURT where it was held that There is no justification for levy of penalty for the period recovery of tax remained stayed by this Court - following the said decision there is no merit in the appeals and the same are hereby dismissed.

Summary

Issues:
1. Common questions of law in VAT Appeal Nos. 33 to 35 of 2017.
2. Legality of orders under Punjab VAT Act, 2005.
3. Levying purchase tax and ITC under the Punjab VAT Act.
4. Appeal against orders of Excise and Taxation authorities.
5. Upholding penalty and interest under the Punjab VAT Act.

Analysis:

1. The judgment addresses multiple VAT appeals with common legal questions. VATAP No.35 of 2017 involves an appellant-assessee challenging an order by the Chairman VAT Tribunal under the Punjab VAT Act, 2005. The appellant raises substantial questions of law regarding the legality and sustainability of the orders in question.

2. The appellant, a cooperative society engaged in sugarcane processing, contests the assessment by the Excise and Taxation cum Designated Officer, Jalandhar, regarding the purchase price of sugarcane for levy of purchase tax. Discrepancies arise in the declared purchase price, inter-state purchases, tax-free goods, and input tax credit claimed. The Assessing officer's adjustments lead to additional demands, including penalties and interest.

3. The court dismisses questions (i), (ii), and (iv) as settled by previous judgments. Question (iii) regarding the levy of purchase tax and ITC is decided against the appellant based on precedent. The court emphasizes that input tax credit cannot be granted for unpaid purchase tax, as per the Punjab VAT Act.

4. Questions (v) and (vi) are also dismissed in light of prior judgments that have already concluded against the appellant. The court refers to specific cases where similar issues were addressed, leading to the rejection of the appellant's contentions.

5. Ultimately, the court finds no merit in the appeals and proceeds to dismiss them, upholding the decisions of the Excise and Taxation authorities. The judgment provides a detailed analysis of each legal issue raised by the appellant, citing relevant precedents and legal provisions under the Punjab VAT Act, 2005.