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2020 (8) TMI 777 - HC - VAT and Sales TaxLevy of penalty under Section 10A of the Central Sales Tax Act, 1956 - it was viewed by the respondent that procurement of Low sulphur Heavy Stock Furnace Oil from oil companies against C-Form was improper for the period in dispute namely the assessment years 2007-2008, 2009-2010 and 2011-2012 - HELD THAT - There is no doubt that the petitioner is engaged in generation of electricity. For generation of electricity the petitioner is required to use Low Sulphur Heavy Stock Furnace Oil. Earlier when the petitioner had obtained certificate of registration on 06.06.2000, there was a specific reference to Furnace Oil - Later, the registration was altered as Power Generating and Distributions and Transmission and Oil. This amendment was made to the registration certificate with effect from 06.06.2000 vide amendment to the registration certificate issued on 24.07.2001. Thus, it is evident that petitioner was entitled to procure oil of every description as long as it was intended for generation of electricity and power along with, the other goods specified in the Certificate of Registration, oil would include Low Sulphur Heavy Stock Furnace Oil. It is also not the case of the respondent that Low Sulphur Heavy Stock Furnace Oil was not used for generating electricity and power - the conclusion arrived in the impugned orders that the petitioner had wrongly procured Low Sulphur Heavy Stock Furnace Oil against C-Form cannot be countenanced. Petition allowed.
Issues:
1. Imposition of penalty under Section 10A of the Central Sales Tax Act, 1956. 2. Interpretation of the petitioner's Central Sales Tax Registration. 3. Allegations of improper procurement of Low Sulphur Heavy Stock Furnace Oil. 4. Jurisdictional validity of the impugned orders. 5. Availability of alternative remedy through appeal. Analysis: 1. The respondent imposed a penalty under Section 10A of the Central Sales Tax Act, 1956, on the petitioner for allegedly falsely representing the procurement of Low Sulphur Heavy Stock Furnace Oil. The impugned order highlighted discrepancies in the registration and tax applicability, leading to the penalty imposition. 2. The petitioner's Central Sales Tax Registration was initially for specific items related to power generation. Over time, amendments were made to include a broader range of items, including various oils like Low Sulphur Heavy Stock Furnace Oil. The dispute arose regarding the interpretation of these amendments and their alignment with the procurement of the said oil. 3. The respondent contended that the petitioner improperly procured Low Sulphur Heavy Stock Furnace Oil against C-Form during specific assessment years. The petitioner argued that the procurement was in line with the registration, emphasizing the usage of the oil for power generation and distribution purposes. 4. The petitioner challenged the jurisdictional validity of the impugned orders, citing precedents where writ petitions were entertained for fundamental rights enforcement or challenging actions without jurisdiction. References were made to relevant legal decisions to support the argument against the jurisdictional validity of the orders. 5. The respondent argued for the availability of an alternative remedy through an appeal before the Deputy Appellate Commissioner, suggesting that the writ petitions should be dismissed. However, the petitioner maintained that the impugned orders were flawed and biased, leading to the conclusion that the orders should be set aside, and the writ petitions allowed. In conclusion, the High Court found in favor of the petitioner, ruling that the impugned orders were passed with a revenue bias and lacked merit. The court set aside the orders, allowing the writ petitions and closing the connected Miscellaneous Petitions without costs.
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