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TMI Blog2018 (4) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... involved in the generation of electricity through its power plant at Bawal in Haryana. Natural gas is used for generation of electricity. The natural gas is supplied by M/s Bharat Petroleum Corporation Limited and M/s Indian Oil Corporation Limited from Gujarat. 3. The petitioner, before the Goods & Service Tax, 2017 (for short, 'GST') came into force, was registered under the Haryana Value Added Tax Act, 2003 (for short, 'the HVAT Act') and under the Central Sales Tax Act, 1956 (for short, 'the CST Act'). The registration under the CST Act continues to date. The certificate admittedly includes natural gas. The certificate is in Form B which in so far as it is relevant reads :- Form B Certificate of Registration [See rule 5 (1)] TIN No. 06342708008 This is to certify that M/S CAPRO POWER LTD. whose principal place of business within the State of Haryana has been registered as a dealer under sections 7 (1) 7 (2) of the Central Sales Tax Act, 1956. The class (es) of goods specified for the purposes of sub-sections (1) and (3) of section 8 of the said Act is/are as follows and the sales of these goods in the course of inter-State trade to the dealer shall be taxable at the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law for the time being in force in any State or part thereof which provides for the levy of taxes on the sale or purchase of goods generally or on any specified goods expressly mentioned in that behalf and includes value added tax law, and "general sales tax law" means any law for the time being in force in any State or part thereof which provides for the levy of tax on the sale or purchase of goods generally and includes value added tax law; A sale or purchase of goods shall be deemed to take place in the course of inter-State trade or commerce if the sale or purchase - (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. Explanation 1 - Where goods are delivered to a carrier or other bailee for transmission, the movement of the goods shall, for the purposes of clause (b), be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailee. Explanation 2 - Where the movement of goods commences and terminates in the same State it shall not be deemed to be a movement of goods from one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hanged the name, place or nature of his business or the class or 44classes of goods in which he carries on business or for any other reason the certificate of registration granted to him requires to be amended; or (b) be cancelled by the authority granting it where he is satisfied, after due notice to the dealer to whom it has been granted, that he has ceased to carry on business or has ceased to exist or has failed without sufficient cause, to comply with an order under subsection (3A) or with the provisions of sub-section (3C) or sub- section (3E) or has failed to pay any tax or penalty payable under this Act, or in the case of a dealer registered under sub-section (2) has ceased to be liable to pay tax under the sales tax law of the appropriate State or for any other sufficient reason. 8. Rates of tax on sales in the course of inter- State trade or commerce.- (1) Every dealer, who in the course of inter-State trade or commerce, sells to a registered dealer goods of the description referred to in sub-section (3), shall be liable to pay tax under this Act, which shall be three percent, of his turnover or at the rate applicable to the sale or purchase of such goods insi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess re-assess, collect and enforce payment of tax, including any interest or penalty, payable by a dealer under this Act as if the tax or interest or penalty payable by such a dealer under this Act is a tax or interest or penalty payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of, or successor to, such business, transfer of liability of any firm or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, granted to him; and such authority may, if satisfied with the reasons given, make such amendments as it thinks necessary, in the certificate of registration and the copies thereof, if any, granted to him. (D) Form C is as follows :- FORM C ORIGINAL THE CENTRAL SALES TAX ((Registration & Turnover) RULES, 1957 FORM 'C' FORM OF DECLARATION [Rule 12 (1)] Name of issuing State Officer of issue Date of issue Name of the purchasing dealer to whom issued alongwith his Registration Certificate No..... Date from which registration is valid Seal of the Issuing Authority Serial No. .............. To * (Seller) Certified that the goods ** Ordered for in our purchase Order No. .......................... dated ................ and supplied as per Bill/Cash Memo/Challan No.............. dated .................................. as stated below* purchased from you as per Bill/Cash Memo Challan No......................... dated ................................. are for resale.....use in manufacture/processing of goods for sale..... use in mining.... use in generation/distribution of power.....Packing of goods for sale/re-sale and are cov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business; (c) the activities specified in Schedule I, made or agreed to be made without a consideration; and (d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. 9. (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the Haryana Goods and Services Tax on all intra-State supplies of goods or services or both, except on the supply of alcoholic liquor for human consumption, on the value determined under section 15 and at such rates, not exceeding twenty percent, as may be notified by the Government on the recommendations of the Council and collected in such manner, as may be prescribed and shall be paid by the taxable person. (2) The State tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel, shall be levied with effect from such date, as may be notified by the Government on the recommendations of the Council. 174. (1) Save as otherwise pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sale of natural gas. 9. Under Section 9 sales tax is levied by the Government of India but is to be collected in the State, from which the movement of goods commenced. Under Section 9 (2) the authorities empowered to re-assess, collect and enforce payment of tax under the general sales tax law of the appropriate State are to do so even on behalf of the Government of India with respect to the tax due under the CST Act. 10. As per Section 7 (1) of the CST Act, every dealer who was liable to pay tax under the CST Act was required to make an application for registration under the CST Act. The petitioner does not sell natural gas. Nor does it sell electrical energy outside the State of Haryana. It is therefore not liable to pay tax under the CST Act. However, under section 7 (2), a dealer though not liable to pay tax under the CST Act but liable to pay tax under the sales tax law of the appropriate State or where there was no such law in force in the appropriate State or any part thereof any dealer having a place of business in that State could apply for registration under the CST Act. A dealer registered under Section 7 was termed as a registered dealer for the purpose of the CS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Oil Companies from Gujarat. The sales occasioned the movement of natural gas from Gujarat to Haryana. The petitioner is a registered dealer in the State of Haryana. The Haryana authorities had been issuing 'C' Forms to the petitioner which were given to the Oil Companies in Gujarat who produced the same before the Gujarat tax authorities and were assessed at a reduced rate of tax. This continued till the implementation of the Goods & Service Tax. The question is whether the petitioner continues to be entitled to the 'C' Forms after the CGST Act, 2017. We think it is. 15. Entry 54 of the State List of the Seventh Schedule to the Constitution of India as amended by the Constitution (One Hundred and First Amendment) Act, 2016, reads as under :- "54. Taxes on the sale of petroleum, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption, but not including sale in the course of inter-State trade of commerce or sale in the course of international trade or commerce of such goods." 16. After implementation of the GST Act with effect from 01.07.2017, the definition of 'goods' under the CST Act wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HVAT Act and that registration under the HGST Act is not relevant. 22. The submission is not well founded. As Mr. Ankur Saigal, the learned counsel appearing on behalf of the petitioner rightly submitted, the contention proceeds on the erroneous basis that only a dealer registered under the HVAT Act is covered by section 7 (2). The plain language of section 7 (2) does not contain such a limitation. The petitioner is not liable to pay tax under the CST Act but it is liable to pay tax under the HGST Act, 2017 as it sells electricity within Haryana. Under Section 7 (2) of the CST Act which applies to the petitioner, a dealer liable to pay tax under the sales tax law of the appropriate State may apply for registration notwithstanding that he is not liable to pay tax under the CST Act. 'Sales tax laws' have been defined under Section 2 (i) of the CST Act to mean the law for the time being in force in any State for levy of taxes on the sale or purchase of goods generally or on any specified goods expressly mentioned in that behalf and includes value added tax laws. The definition is inclusive in nature. It is not restricted to any particular sales tax enactment. The HGST Act is also a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 7 and 8 of the CST Act would be met. 24. The petitioner therefore fulfils all the requirements of Section 7 (2) of the CST Act. It is liable to pay tax in the State of Haryana under the HGST Act. Even though there is no liability under the CST Act, yet it will be a registered dealer under Section 7 (2) of the CST Act. 25. Mrs. Talwar then contended that the petitioner is not engaged in the business of re-selling the natural gas and is, therefore, not entitled to be issued 'C' Forms. The basis of the argument is that after the CGST Act came into force, the petitioner was not liable to pay any tax on electricity under the HVAT Act and it, therefore, ceases to be a registered dealer as per Section 7 (2) of the CST Act. Mrs. Talwar contended that the petitioner's registration under the CST Act lapsed on the commencement of the HGST Act and it ceased to have any effect. She contended that the petitioner does not sell within the State of Haryana or otherwise the same goods, namely natural gas, that it purchases from the Oil Companies in Gujarat. According to her, the provisions of the CST Act and in particular Sections 7 and 8 thereof would apply only if the petitioner sold ..... X X X X Extracts X X X X X X X X Extracts X X X X
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