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TMI Blog2024 (11) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... y to the High Court against such refusal. The hierarchy of remedies as created under the DST Act, insofar as appeals are concerned, is essentially replicated and re-enacted by the DVAT Act. Under the DVAT Act, the assessee stands accorded the remedy of preferring an appeal to the Appellate Tribunal which stands constituted. The DVAT Act further enables an aggrieved person to approach the High Court by way of an appeal in respect of every order passed by the Appellate Tribunal. The appeal to the High Court, however, is subject to the appellant establishing that the case involves a substantial question of law . The obligation to petition the Tribunal for drawal of a statement of case cannot be construed as a liability accrued or incurred. It was merely a matter of procedure and which did not impair the right of appeal. This more so since a referral by the Tribunal to draw a statement of case was subject to review and correction. The appeals as instituted before this Court in accordance with Section 81 of the DVAT are, consequently, held to be maintainable - let these matters be listed on 17.12.2024. - HON'BLE MR. JUSTICE YASHWANT VARMA AND HON'BLE MR. JUSTICE RAVINDER DUDEJ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to refer to the High Court any question of law arising out of such order, and, subject to the other provisions contained in this section, the Appellate Tribunal shall, within one hundred and twenty days of the receipt of such application, draw up a statement of the case and refer it to the High Court: Provided that the Appellate Tribunal may, if it is satisfied that the dealer or the Commissioner was prevented by sufficient cause from presenting the application within the period hereinbefore specified, allow it to be presented within a further period not exceeding thirty days. (2) If the Appellate Tribunal refuses to state the case which it has been required to do, on the ground that no question of law arises, the dealer or the Commissioner, as the case may be, within thirty days of the communication of such refusal either withdraw his application (and if he does so, any fee paid shall be refunded), or apply to the High Court against such refusal. (3) If upon receipt of an application under sub-section (2), the High Court is not satisfied as to the correctness of the decision of the Appellate Tribunal, it may require the Appellate Tribunal to state the case and refer it, and on re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he First day of April, 2005.] (b) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved. (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (4) The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which- (a) has not been determined by the Appellate Tribunal; (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1). (7) Where an appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax, imposition of any penalty or of interest or forfeiture of any sum, which relates to any period ending before 1st day of April, 2005 or for any other purpose whatsoever connected with or incidental to any of the purposes aforesaid, and whether or not the tax, penalty, interest or sum forfeited, if any, in relation to such proceedings, is paid before, on or after 1st day of April, 2005, the repealed Act and all rules, regulations, orders, notifications, forms and notices issued thereunder and in force immediately before 1st day of April, 2005 shall continue to have effect as if this Act has not been passed.] 5. In one of the earliest decisions which this Court came to render post the repeal of the DST Act was in the matter of Shiv Shakti Kirana Kendra vs. Commissioner, VAT 2009 SCC OnLine Del 2487. The Court in Shiv Shakti Kirana Kendra was called upon to answer the question whether a further appeal after the repeal of the DST Act would lie under the provisions of Section 81 of the DVAT Act or whether the appellant would have to seek a reference as contemplated under Section 45 of the repealed enactment. Dealing with the aforesaid question, the Division Bench in Shiv Shakti K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gammon India's case has independently arrived at a decision that an appeal will lie under the new VAT Act. We, respectfully agree with this view as expressed in the said decision of the Punjab and Haryana High Court, also for additional reasons which we have indicated above. 11. Even if we look at the issue from the aspect of retrospectivity of a legislation, even then in such a case, we find that the legislature, qua the forum of appeal, has taken a conscious decision on retrospective operation of Delhi VAT Act as regards forum of a second appeal to the High Court by virtue of Section 106 (3) and which provision makes it clear that all orders passed under the Delhi Sales Tax Act will be treated as if they have been passed under the Delhi VAT Act. Thus vide Section 106 (3) the order passed by the Appellate Tribunal will be an order, not under Section 44 of the Delhi Sales Tax Act, but one under Section 74 of the Delhi VAT Act. The unambiguous language of Section 106 (2) can lead to no other conclusion than that the appeal will now lie to the High Court under Section 81 of the Delhi VAT Act even if the order which is passed by the Tribunal is in respect to proceedings which were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot been brought to tax or has been brought to tax at lower rate or has been incorrectly classified or any claims incorrectly granted or that that liability to tax is understated or (b) in any case, the order is erroneous, insofar as it is prejudicial to the interest of Revenue and after examination, the Commissioner may pass an order to the best of his judgment, where necessary. 13. By way of Amendment to the DVAT Act, by the Delhi Value Added Tax (Amendment) Act, 2009 notified on 6th January 2010, sub-Section 5 was inserted in Section 74A of the DVAT Act which stated that notwithstanding anything contained in any judgment, decree or order of any Court, the provisions of this Section shall be deemed to have come into effect with effect from the 1st April 2005. In other words, the power of the Commissioner to revise the order of the subordinate officer in terms of Section 74A of DVAT Act was made effective from 1st April 2005. Section 74A itself was inserted and notified with effect from 16th November 2005. Therefore, during the period from 1st April 2005 to 16th November 2005 there was no provision under the DVAT Act which was similar to Section 46 of the DST Act which granted to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new Act. 63. In the present factual matrix, an order of assessment passed under the Delhi Sales tax Act was subject to revision under section 46 of the DST Act. The assessee was given a right to prefer revision under section 47 of the DST Act. The said order of assessment was subject to appeal and revision under the DST Act. The core issue that has emerged in this batch of petitions is whether by virtue of the language employed under section 106 of the DVAT Act, the exercise of revisionary power gets totally extinguished. 64. It would not be out of place to refer to a passage from Craies on Statute Law, Seventh Edition, page 403, wherein it has been stated thus : If the three months' limit imposed by the Act of 1885 had expired before the commencement of the Act of 1904, the offender's prosecution would have been then barred by prescription, and the new Act would not, on coming into force, have destroyed a prescription already acquired. 65. From the aforesaid pronouncements in the field, the following principles can safely be culled out : (i) The concept of liability accrued or incurred therein and obligation have different connotations. (ii) The meaning of right accrued an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... boundaries. The term finality has to be understood in its truest denotation and an order of assessment by itself does not earn the status of being final unless it is totally barred by law to be touched. Section 106 (3) of the DVAT Act clearly lays a postulate that an order passed under section 46 of the DST Act and the process of assessment leading to it is deemed to have been done in exercise of the power conferred under the DVAT Act. What is provided under section 106 (2) is that the repeal shall not affect the previous operation of the DST Act or any right, title, entitlement, obligation or liability already acquired, accrued or incurred thereunder. On a seemly scanning of the provision engrafted under section 46 of the DST Act, a suo motu revision could be initiated and concluded within five years of the order of assessment. In sub-section (2) (b) of section 74A of the DVAT Act, a rigor has been attached that no order under this section shall be passed after the expiry of four years from the end of the year in which the order passed by the subordinate officer has been served on the dealer. Section 74A (2) (c) carves out a period of five years under certain other circumstances. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il 1, 2005, clearly conveys that the Legislature at all point of time intended to protect the interest of the Revenue. 70. At this juncture, we may state with certitude that though a cavil was raised by learned counsel for both the sides with regard to the applicability of the Bengal General Clauses Act, 1891 to the Government of NCT of Delhi, the same has not been adverted to by us because of the interpretation placed by us under the repeal and savings provision. The said issue is kept open. 71. In view of our aforesaid premised reasons, we proceed to record our conclusions in seriatim : (a) The interpretation placed by the Division Bench in International Metro Civil Contractors [2008] 16 VST 329 (Delhi) and L. G. Electronics (India) Ltd. [2008] 16 VST 361 (Delhi) on section 106 of the DVAT Act is not correct. (b) The conclusion in International Metro Civil Contractors [2008] 16 VST 329 (Delhi) and L. G. Electronics (India) Ltd. [2008] 16 VST 361 (Delhi) to the effect that despite incorporation of section 74A in the DVAT Act on November 16, 2005, the suo motu revisional proceeding could not be initiated at the commencement of the DVAT Act, i.e., April 1, 2005, as the legislative i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in Jupitor Exports observed as follows: 1. This appeal under Section 81 of Delhi Value Added Tax, 2004 (hereinafter referred to as the Delhi VAT Act ), is directed against the order dated 07.01.2014 passed by the Appellate Tribunal: Value Added Tax (VAT) Delhi (hereinafter referred to as the Appellate Tribunal ) in appeal which had been preferred before it and registered vide No. 75/STT/-05-06, in turn, questioning the legality, correctness and propriety of the order dated 06.06.2005 passed by the Commissioner, Sales Tax (hereinafter, the Commissioner ) rejecting the request of the respondent herein ( the Assessee ) for compounding the offences allegedly committed by the latter under Section 50 (1) (a) and (j) of Delhi Sales Tax Act, 1975 (hereinafter referred to as the Delhi Sales Tax Act ) in terms of the provisions contained in Section 54 thereof. 2. It may be mentioned here that by Section 106 of Delhi VAT Act, amongst others, the Delhi Sales Tax Act was repealed with effect from 01.04.2005. Notwithstanding such repeal, right, title, entitlement, obligation or liability already acquired, accrued or incurred under the repealed legislation survived. The authorities under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal, was required to submit a request to that Tribunal to refer a question of law arising out of such order for the consideration of the High Court. In terms of Section 45 (2), if the Appellate Tribunal were to refuse to state the case on forming the opinion that no question of law arose, both the dealer as well as the Commissioner stood enabled to apply to the High Court against such refusal. 13. The hierarchy of remedies as created under the DST Act, insofar as appeals are concerned, is essentially replicated and re-enacted by the DVAT Act. Under the DVAT Act, the assessee stands accorded the remedy of preferring an appeal to the Appellate Tribunal which stands constituted. The DVAT Act further enables an aggrieved person to approach the High Court by way of an appeal in respect of every order passed by the Appellate Tribunal. The appeal to the High Court, however, is subject to the appellant establishing that the case involves a substantial question of law . 14. The fundamental difference between the two enactments, insofar as appeals to the High Court are concerned, lies in the fact that a person aggrieved, now and post the promulgation of the DVAT Act, is entitled to approach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preted as requiring adherence to a procedure which existed under the erstwhile enactment. Undisputedly, the right of an appeal against an order passed by the Appellate Tribunal existed even under the erstwhile DST Act. That right has not been obliterated consequent to the promulgation of the DVAT Act. In fact, the said right stands preserved by virtue of Section 81 of that Act. 20. It also becomes pertinent to note that Section 106, while undoubtedly repealing the DST Act, also in unambiguous terms, seeks to preserve all rights, entitlements, obligations or liabilities acquired, accrued or incurred under the DST Act. The promulgation of the DVAT Act was thus, and in light of the express language of Section 106, not intended to be an annihilation of rights and liabilities which otherwise existed under the DST Act and were available to be exercised prior to 01 April 2005. 21. The effect of repeal and its impact on rights and liabilities which may have been incurred or had accrued was lucidly explained by the Supreme Court in Gammon India Ltd. vs. Spl. Chief Secy. (2006) 3 SCC 354. We deem it apposite to extract the following passages from that decision: 38. In Pentheny, Ltd. v. Govt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstituted and continued in respect of any matter pending under the repealed Act as if that Act was in force at the time of repeal. In other words, whenever there is a repeal of an enactment the consequences laid down in Section 6 of the General Clauses Act will follow unless, as the section itself says, a different intention appears in the repealing statute. xxxx xxxx xxxx 68. Francis Bennion in his book on Statutory Interpretation, (2nd Edn.) says that where an English Act passed after 1878, repeals and re-enacts the enactment (with or without modification) then, unless the contrary intention appears, anything done, or having effect as if done, under the enactment repealed, insofar as it could have been done under the provision re-enacted, has effect as if done under that provision. 69. G.P. Singh in his book on Principles of Statutory Interpretation, 2006 Edn. enumerated the effect of clauses (c) to (e) of Section 6 of the General Clauses Act, namely, is to prevent the obliteration of a statute in spite of its repeal to keep intact rights acquired or accrued and liabilities incurred during its operation and permit continuance or institution of any legal proceedings or recourse to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ys by amending section 3. To reduce the limitation period for revision of returns and filing of objection for correction of deficiencies in return from four years to one year, section 28 is proposed to be amended. To provide for treating any return having been digitally signed as per the provisions of clause (p) of sub-section (1) of section 2 of the Information Technology Act, 2000 (No.21 of 2000) at par with electronic return to mean returns in the Act 29 is proposed to be amended. To further extend the period of limitation prescribed under sub-section (10) of section 74 of the DVAT Act by another year, which would mean that these appeals would have to be decided by 31.03.2013 instead of 31.03.2012, section 74 is proposed to be amended. For conferring power on the High Court to condone the delay in filing of appeals, a proviso was inserted in the Section 81 through the Delhi Act 12 of 2010 which took effect from 1st February 2011. While the intended purpose of the amendment was to make the provision applicable to some appeals which were dismissed by the High Court for delayed filing, before the amendment, the earlier amendment can achieve its useful purpose/objective only if the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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