2019 (5) TMI 757 - SC - VAT and Sales Tax

Reimbursement of State Sales tax paid - inter-state transaction - refund of the Sales Tax paid on the inter-state purchase of coal - Section 15(b) of the Central Sales Tax Act, 1956 - whether Coal and Coke are same goods or not? - HELD THAT - The respondent was entitled to be reimbursed the tax paid under the State Law on Coal and, therefore, the respondent had filed an application seeking refund. On the basis of the detailed adjudication by the Assistant Commissioner of Commercial Taxes, the amount refundable to the petitioner under Section 15 (b) of the Act was determined and an amount of ₹ 12,32,496 was determined. Thereupon, the respondent filed an application under statutory Form-XX as prescribed under Rule 35 of the Rules, 1983 but no steps were taken by the respondent for issuance of the Refund Payment Order. Despite repeated requests to process its application for refund and to issue the Refund Payment Order, no steps were taken. The respondent was entitled to claim refund of the said amount with interest @ 9% from the date of expiry of 6 months of the date of receipt of the application. High Court proceeded to consider the petition and pass the order which we have already adverted to. There was absolutely no whisper in the counter affidavit or additional affidavit filed by the appellants seeking to project the dispute that Coal purchased by the respondents was not the same good as Coke manufactured out of Coal and, therefore, on sale of Coke in an inter-state Sale, the respondent is not entitled to get refund of the tax paid on the intrastate purchase of Coal. The question which has been raised by the Appellant-State, was never raised and the writ petition filed by the respondent, was on the basis of the determination of the Refund under Section 15(b) of the Act. In such circumstances, no relief can be granted to the appellant - Appeal dismissed.

Summary

Issues:
1. Reimbursement of State Sales Tax paid on the purchase of coal.
2. Interpretation of Section 15(b) of the Central Sales Tax Act, 1956.
3. Claim for refund under Section 15(b) in case of intra-state and inter-state sales of declared goods.
4. Applicability of Article 286 of the Constitution of India.
5. Discrepancy in the goods purchased and sold in intra-state and inter-state transactions.
6. Judicial interpretation of relevant legal provisions.

Analysis:
1. The judgment dealt with the issue of reimbursement of State Sales Tax paid on the purchase of coal by a respondent-writ petitioner in Jharkhand. The High Court directed the appellants to reimburse the tax paid on coal, which was later converted to coke and sold in an inter-state transaction. The contention was based on Section 15(b) of the Central Sales Tax Act, 1956.

2. The interpretation of Section 15(b) was crucial in determining the eligibility for tax reimbursement in cases involving intra-state and inter-state sales of declared goods. The Act provides for the reimbursement of tax paid under state law when goods sold in inter-state trade are subject to Central Sales Tax. The key argument was whether the goods purchased and sold were the same, even if they were declared goods under Section 14 of the Act.

3. The judgment analyzed the claim for refund under Section 15(b) concerning the tax paid on coal purchased intra-state and later sold inter-state as coke. The respondent sought reimbursement based on the statutory provisions, while the appellant argued that coal and coke were different goods, thus challenging the eligibility for tax refund.

4. The applicability of Article 286 of the Constitution of India was discussed in relation to the imposition of tax on goods of special importance in inter-state trade or commerce. The judgment highlighted the legislative intent behind enacting the Act to regulate the levy of tax on declared goods and ensure compliance with constitutional provisions.

5. The discrepancy between the goods purchased (coal) and sold (coke) in intra-state and inter-state transactions raised a fundamental question of whether the difference in goods precluded the respondent from claiming tax reimbursement. The judgment examined the nature of the goods, their classification, and the impact on the eligibility for tax refund under Section 15(b).

6. The judicial interpretation of relevant legal provisions, including precedents such as Tvl. K.A.K. Anwar and Co. v. State of Tamil Nadu, guided the analysis of the case. The court scrutinized the pleadings, counter affidavits, and the relief sought by the respondent to determine the scope of the issue before rendering the decision to dismiss the appeals based on the specific grounds raised during the proceedings.