9911796707
TMI Blog2019 (5) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner that up to January, 2015 they have collected and paid tax at the rate of 15% of the turnover actually used by them after claiming goods return and therefore, the claim of goods return will have to be allowed and the payment of tax on the remaining value as per the return filed by the petitioners up to 20th January, 2015 should be held as valid, appears to be correct. It is an accurate understanding of this court s order. This is not a case of any undue or uncalled for or illegal benefit being conferred on the dealer. This is a case of misreading and misinterpretation of the judgment of this court. Merely because the order of 11th September, 2006 is set aside by the Maharashtra Sales Tax Tribunal by its judgment and order dated 20th January, 2015, the transactions covered and dealt with by that judgment, which gave rise to a tax liability, cannot now be reopened. This Court has clearly dealt with the issue of prospectivity to the order of the MSTT in the light of section 52(2) of the BST Act. Once this Court has come to the conclusion that this was a fit case where the MSTT ought to have exercised its discretion and granted prospective effect to its judgment and order , th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders of rectification for the period 2011-12 & 2013-2014 to give the effect of prospective effect in both the years in terms of the judgment and Order of this Hon'ble Court dated 22.03.2018. (e) Pending the notice, admission and final hearing of this Petition this Hon'ble Court, restrain the Respondents from raising any demand for any years up to 2001-2015, by disallowing goods return claim as also treating the process as Manufacture and permanently thereafter. (f) Pending the notice, admission and final hearing of this Petition this Hon'ble Court may be pleased to stay the recovery of demand raised by the impugned Assessment Orders passed for the periods 2013-14 and 2011-12. (g) No coercive measures of recovery be taken against the Petitioner by the Respondents based on the assessments under challenge for the period 2011-12 and 2013-14. (h) Hearing of this Petition may please be expedited. (i) Ex-parte Ad-interim relief in terms of prayer (e), (f) and (g) herein above. (j) Any such orders that the Court may deem fit. The facts of the case in brief are as under : 4. The petitioner No.1 is a public limited company inter alia engaged in the business of manufacturing p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (without N-Paraffin) returned by RIL to BPCL is also kerosene, exempt from tax under entry 160 of notification issued under section 41 of BST Act. 8. The Second question was also answered in favour of RIL and BPCL holding that transaction of return of kerosene by RIL to BPCL amounts to 'return of goods' by RIL to BPCL in terms of rule 4 of the BST rules and not sale. 9. Several rounds of litigation thereafter ensued. Suffice it to observe that it was for the first and last time in the history of Bombay Sales Tax Act, DDQ by Commissioner was challenged by the State before the Maharashtra Sales Tax Tribunal ('MSTT' for short). The MSTT by order dated 20th January 2015 overruled the order of the Commissioner and held that the return stream of kerosene was not a 'return of goods' and hence liable to be taxed as a sale. The MSTT also in its order rejected the plea of the BPCL and RIL to grant prospective effect to its order under section 52(2) of the BST Act. The order of DDQ passed in 2006 was reversed by the MSTT on 20/01/2015. 10. The order of the MSTT dated 20/01/2015 came to be challenged by RIL as well as BPCL by filing separate Writ Petitions and Reference Application before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in not granting the prospective effect to its judgment and order dated 20/01/2015, also having further observed "we feel that this was a fit case where the MSTT ought to have exercised its discretion and granted prospective effect to its judgment and order....", the impugned assessment orders, therefore, are unsustainable in the teeth of the order passed by this Court. 16. Learned Senior Counsel Shri R.A.Dada appearing on behalf of BPCL invited our attention to the order passed by this Court in Writ Petition No. 2217 of 2015. Learned counsel submitted that under section 52(2) of BST Act, the Commissioner has power to give prospective effect to DDQ order passed by the Commissioner under section 52(2) of the said Act. It was urged that the DDQ order of the Commissioner dated 11/09/2006 was in favour of RIL and BPCL. Learned Senior Counsel invited our attention to judgment and order of this Court dated 22/03/2018, wherein it is observed, "this is the only case in the history of of Sales Tax law in the State where the State filed an Appeal against DDQ order passed by the Commissioner under section 52". Learned Senior Counsel submitted that since the DDQ order was in favour of the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt holds that the order of the MSTT has to be given prospective effect in terms of section 52(2) of the BST Act, respondent No.3 is obliged to act in accordance with the directions of this Court. Learned Senior Counsel relied upon the decision of the Apex Court in the case of Kone Elevator India Pvt. Ltd. Vs. State of Tamil Nadu and ors. (2014) 71 VST 1 (SC). 20. On the other hand, learned counsel Shri Sonpal appearing on behalf of respondents argued in support of the impugned order of assessment. He invited our attention to the provisions of section 52(2) of BST Act. He would submit that the MSTT having interfered with the order passed by the Commissioner, the liability relates back to the date of the order passed by the Commissioner and not from the MSTT's order. In his submission, the order passed by the MSTT has merged with the order passed by the Commissioner. Relying on the plain language of section 52(2) of BST Act, Shri Sonpal would submit that when legislature specifically empowers the Commissioner to direct that the determination shall not affect the liability of any person under this Act, as respects any sale or purchase effected prior to the determination, then, the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period covered by this assessment order is 1st April, 2013 to 31st March, 2014. There, a show cause notice in Form 301, a reminder for the above period was issued and the parties appeared before the Deputy Commissioner of Sales Tax. M/s.Reliance Industries Limited argued that it has entered into an agreement with M/s.Bharat Petroleum Corporation Ltd. (BPCL) for supply of Superior Kerosene Oil through pipeline from the refinery of M/s. BPCL located at Mahul and Ms/Reliance Industries Limited, after extraction of N-Paraffin from the Kerosene Oil, returned the goods through pipeline. In the case of previous transactions, arising out of this agreement, the Commissioner had passed an order on 11th September, 2006. Aggrieved by this order of the Commissioner, the Government of Maharashtra preferred an appeal before the Maharashtra Sales Tax Tribunal and that appeal was dismissed on the ground of maintainability. Later on, that order came to be set aside by this court in a writ petition of the Government of Maharashtra and the matter was sent back to the Tribunal. The tribunal condoned the delay in filing of the State's appeal, admitted it and then made a final order on 20th January, 2015 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all the periods up to the period ending 20th January, 2015. The determination of the disputed question by the Commissioner dated 11th September, 2006 was binding it until the tribunal intervened and set it aside. 29. If we take the period of assessment, it is evident that the same is 1st April, 2013 to 31st March, 2014. In this writ petition, the petitioner, in para 20 says that it received the assessment order for the financial year 2011-12 on 23rd October, 2017 and that raised exorbitant demand by disallowing the goods return claim and treating the same as taxable. The tax levied on the goods return is to the tune of ₹ 336,60,07,947/. The assessment is topped with levy of interest and penalty. As the petitioner was protected by the stay granted by this court, it filed a formal appeal and requested the appellate authority to await for this court's order. Paras 21 to 23 and 28 of this petition read as under: "21. After receipt of the High Court order dated 22nd March 2018, the Petitioner applied for Rectification under Section 24 of the MVAT Act by letter dated 25th May 2018. Hereto annexed and marked Exhibit-G is the copy of the said application. The Rectification was ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal and grant of stay. As per this amendment 10% of disputed tax with a maximum limit of 15 crores is fixed as mandatory Pre deposit. Therefore in the present case Petitioner would be called upon to pay 10% of the disputed tax under the MVAT and CST Act (subject to maximum 15 crores in an appeal). The Petitioner submit that exorbitant liability is created as a deliberate mischief, ignoring the clear directions of the High Court Judgment. The Order is therefore without jurisdiction, illegal, vindictive and vexatious, raising the following demand: (Figures in rupees) Act Tax Interest Penalty Total MVAT 166,51,76,429 1,33,21,41,183 65,99,888 300,39,17,500 CST 73,57,29,658 58,85,83,741 NIL 132,43,13,400 Out of the total demand as created herein above, the demand on account of not allowing the goods return claim under the MVAT and CST Act is as follows: Act Total Disputed Tax of Goods Return Tax levied thereon 10% as per S-26( 6A) MVAT 31345254587 3918156823 391815682 CST Nil Nil Nil The liability under the Central Sales Tax Act is mainly on account of disallowance of Refund carried forward under MVAT Act to CST Act by the Appellant in the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven to the tribunal's order by this court by terming it as applicable to all live proceedings. If the assessment in hand pertaining to financial year 2013-14 is considered live, then, the assessment order overlooks the fact that it is not the financial year, but the transactions covered and dealings up to 20th January, 2015, which is the relevant factor. It is nowhere indicated in the impugned assessment order that the transactions covered are post 20th January, 2015. The case of the petitioner that up to January, 2015 they have collected and paid tax at the rate of 15% of the turnover actually used by them after claiming goods return and therefore, the claim of goods return will have to be allowed and the payment of tax on the remaining value as per the return filed by the petitioners up to 20th January, 2015 should be held as valid, appears to be correct. It is an accurate understanding of this court's order. 32. We are, therefore, not in agreement with Mr. Sonpal, when he urges that the impugned assessment order should be sustained. This is not a case of any undue or uncalled for or illegal benefit being conferred on the dealer. This is a case of misreading and misinterpretati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may be.] (2) - The Commissioner may direct that the [determination or, as the case may be, review] shall not affect the liability of any person under this Act, as respects any sale or purchase effected prior to the [determination or, as the case may be, review] (2A) The Commissioner, for the reasons to be record in writing may, on his own motion, review the order passed by him under sub-section (1) or (2), and pass such order thereon as he thinks just and proper. The order of review shall not affect the liability of any person under this Act, in respect of any sale or purchase effected prior to the review: Provided that, no order shall be passed under this subsection unless the dealer or the person in whose case the order is proposed to be reviewed, has been given a reasonable opportunity of being heard: Provided further that, before initiating any action under subsection (2A) the Commissioner shall obtain prior permission of the Government.] 34. Earlier the order of MSTT dated 21/02/2105 came to be challenged in this Court by way of Writ Petition No. 2217 of 2015. Having gone through the findings, we notice that this Court exhaustively dealt with the issue of prospective ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght from the assessment years 1988-89 till 2004-2005, the assessments have been allowed in favour of the assessee, namely RIL on the basis that the return stream of Kerosene was a "goods return". If prospective effect is not given to the order of the Tribunal it would effectively lead to a situation that all past assessments would have to be reopened and which would be highly unfair and prejudicial not only to RIL but also to BPCL. 36. Having reasoned thus, this Court concluded : "Looking to the totality of the facts of the case and as narrated earlier, we think that the MSTT was unjustified in not granting the prospective effect to its judgment and order dated January 20, 2015. Considering the long checkered history of the litigation between the parties, the assessment orders allowed earlier on the basis that the return stream kerosene was a sales return/goods return and the DDQ order passed in favour of the assessee dated September 11, 2006, we feel that this was a fit case where the MSTT ought to have exercised its discretion and granted prospective effect to its judgment and order. We order accordingly and set aside the order of the MSTT only to this extent. For the foregoi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
