2022 (6) TMI 300 - HC - VAT and Sales Tax

Benefit of the concessional rate of tax - C-Forms issued by the purchaser located in the State of Rajasthan - registration of the dealer i.e., the purchaser located in the State of Rajasthan was cancelled, with retrospective effect - inter-state sale - HELD THAT - Since the Tribunal is the final fact-finding authority, it ought to have given an opportunity to the appellant that the subject transaction were inter-state sale transactions, contrary to what was contended by the respondents/revenue - Tribunal could have also taken recourse to an alternative route, which was to remand the matter to the Assessing Officer for determination of this very issue i.e. whether or not the subject transactions were inter-state sales transactions. Concededly, the Tribunal took recourse to neither route, and simply ruled against the appellant, both in the appeal as well as in the review application. This approach cannot pass muster as it violates established principles of fairness and according equal opportunity to disputants who are present before an adjudicator. The impugned orders are set aside - matter remanded to the Tribunal for a de novo hearing.

Issues involved:
Condonation of delay in filing appeal, Examination of issue not raised by Assessing Authority or OHA, Benefit of concessional rate of tax, Interstate sale transactions, Fairness in adjudication, Remand for de novo hearing.

Condonation of delay in filing appeal:
The appellant filed an application seeking condonation of a delay of 635 days in filing the appeal. The delay was condoned by the court based on the reasons provided in the application, and the application was disposed of accordingly.

Examination of issue not raised by Assessing Authority or OHA:
The appellant's grievance was that the Tribunal examined an issue that did not emerge from the orders of the Assessing Authority or the Objection Hearing Authority. The issue in question was whether the appellants should get the benefit of the concessional rate of tax based on C-Forms issued by a dealer in Rajasthan. The appellant argued that the Tribunal should not have considered this aspect without giving them an opportunity to establish that the transactions were interstate sales.

Benefit of concessional rate of tax:
The appellant had claimed a concessional rate of tax based on C-Forms issued by a dealer in Rajasthan. However, the registration of the dealer in Rajasthan was cancelled retrospectively, leading to the denial of the benefit of C-Forms. The Tribunal accepted the revenue's argument that the appellant needed to establish that the transactions were interstate sales, which was not raised by the Assessing Authority or OHA.

Interstate sale transactions:
The Tribunal ruled against the appellant without giving them an opportunity to establish that the transactions were interstate sales. The court noted that the Tribunal should have either allowed the appellant to establish this fact or remanded the matter to the Assessing Officer for determination. The court set aside the impugned orders and remanded the matter to the Tribunal for a de novo hearing, directing the Tribunal to give the appellant an opportunity to establish whether the transactions were interstate sales.

Fairness in adjudication:
The court emphasized the importance of fairness in adjudication and equal opportunity for disputants. It criticized the Tribunal for not providing the appellant with a chance to prove that the transactions were interstate sales and for ruling against them without following established principles of fairness.

Remand for de novo hearing:
The court set aside the Tribunal's orders and remanded the matter for a de novo hearing. The Tribunal was directed to give the appellant an opportunity to establish whether the transactions were interstate sales and to allow the filing of additional documents if required. The appellant was instructed to appear before the Tribunal on a specified date to hasten the proceedings, and the appeal was disposed of accordingly.

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