2018 (4) TMI 412 - HC - VAT and Sales Tax

Liability of Sales Tax - Form H - According to the appellant, payment of sales tax is exempted since the buses are meant for export - Held that - the documents filed by the respondent would show that it is the liability of the appellant to pay sales tax in the absence of any exemption. The documents marked are not disputed. The terms and conditions along with purchase order would make the position very clear - the suit is very much maintainable since what is sought is one under the terms of the contract. Therefore, no statutory authority is involved. A mere pendency of the proceeding before this Court as held by the trial Court would not bar the civil dispute. All the issues are to be answered in favor of the respondents and against the appellant - appeal suit disposed off.

Summary

Issues:
1. Liability to pay sales tax for exported bus bodies.
2. Entitlement of the respondent for relief.
3. Limitation period for the suit.
4. Suit maintainability during pendency of sales tax levy issue.
5. Relief sought by the respondent.
6. Jurisdiction of the Court.

Analysis:

Liability to pay sales tax for exported bus bodies:
The appellant placed orders for bus bodies meant for export, claiming exemption from sales tax. However, the 'Form H' issued by the appellant was rejected by the Deputy Commercial Tax Officer, leading to the respondent seeking recovery of sales tax amounting to ?14,61,146. The trial Court held the appellant liable for sales tax payment based on purchase orders and terms with the plaintiff.

Entitlement of the respondent for relief:
The respondent paid the sales tax amount during the proceedings, believing it to be the appellant's liability. The trial Court confirmed the liability based on documents and purchase orders, ruling in favor of the respondent for recovery. The subsequent events involved a writ petition challenging the order, leading to a remittance for fresh consideration by the Deputy Commercial Tax Officer.

Limitation period for the suit:
The trial Court framed issues including limitation and suit maintainability during the pendency of the sales tax levy issue. The Court found the suit maintainable under contract terms, not barred by statutory proceedings, and upheld the judgment and decree in favor of the respondent.

Relief sought by the respondent:
The judgment confirmed the liability of the appellant to pay sales tax, with documents and purchase orders supporting the respondent's claim. The suit was deemed maintainable under contract terms, and the Court found no error in the trial Court's decision.

Jurisdiction of the Court:
The Court modified the judgment, stating the respondent can file an execution petition based on the Deputy Commercial Tax Officer's decision. If exemption is granted, the respondent must repay the interim amount received. The appellant can seek payment if the respondent loses the case, with the deposited amount remaining until adjudication.

In conclusion, the Court held in favor of the respondent on all issues, considering subsequent events and directing actions based on the Deputy Commercial Tax Officer's decision. The appeal suit was disposed of with no costs.