VAT AND SERVICE TAX CASES (VST)

ONLINE EDITION

VOL. 3 : ISSUE DATED 24-10-2014

HIGH COURT


Central sales tax--See Import or export (Mad) . . . 429

Commissioner--Trade tax--Reassessment--Show-cause notice issued by Additional Commissioner stating material and reason on which approval sought served on assessee--That reason mentioned in notice not incorporated in order granting approval would not render order invalid--No provision to serve order granting approval on assessee--Assessee participating in assessment proceedings challenging order after lapse of 11 months--Challenge not bona fide--On facts issue raised in proceeding, not adjudicated in original assessment--Reason, on which approval granted after application of mind sufficient to form "belief" that there was escaped assessment--Writ petition inter alia challenging order granting approval by Additional Commissioner, consequential assessment and demand of tax--Dismissed--U. P. Trade Tax Act (15 of 1948), s. 21(2).--Jaypee Hotel Ltd. v. State of U. P. (All) . . . 404

Composition of tax--Value added tax--Application for composition--Delay in filing--Application for condonation of delay--Deputy Commissioner (Appeals) and Tax Board on facts condoning delay and allowing dealer to opt for composition--Revision petition--High Court--No interference--Rajasthan Value Added Tax Act (4 of 2003), ss. 3(2), 64.--Assistant Commissioner, Commercial Taxes v. Panna Lal and Company (Raj) . . . 400

----Value added tax--Delay in filing application under scheme--Application for condonation of delay--Provision in Act enabling acceptance of delayed applications against levy of penalty--Rejection of application merely for delay and without hearing dealer not justified--Dealer's explanation for delay accepted by appellate authorities--Finding of fact--No question of law--Rajasthan Value Added Tax Act (4 of 2003), s. 64.--Assistant Commissioner, Commercial Taxes v. Garg Cold Company (Raj) . . . 396

Declaration form--See Exemption (Karn) . . . 436

Evasion of tax--Sales tax--Penalty--Goods carried under documents showing NDDB, a Government concern, as consignee--Driver admitting goods meant for private party--Vehicle intercepted in front of premises of that party far away from NDDB--Carbon copy of bill not found in bill book--Categorical denial by NDDB of any contract with consignor--Levy of penalty justified.--Assistant Taxes Officer v. Pradeep Industries (Raj) . . . 421

----Sales tax--Penalty--Transport of goods imported from outside India--No tax liability--Finding that there was evasion of tax--Perverse--Purchase of machinery by purchaser in Visakhapatnam from Singapore--Purchaser directing goods to be held at Bangalore till site ready for installation--Lorry receipt issued by staff of dealer at Bangalore based on date of commercial invoice issued by seller, even before arrival of goods in India--Explanation of dealer for discrepancy found true--Goods held at godown in Bangalore till transport to Visakhapatnam--All documents accompanying transport--Commercial invoice satisfying all requirements of bill of sale--Nomenclature not relevant--No attempt to evade tax--Levy of penalty unsustainable--Karnataka Sales Tax Act (25 of 1957), s. 28--Karnataka Sales Tax Rules, 1957, r. 23B.--Wipro GE Healthcare P. Ltd. v. Additional Commissioner of Commercial Taxes (Karn) . . . 440

Exemption--Export and import--Sale in course of import--Goods imported by assessee on purchase from Japan on December 7, 1995, entered Chennai Port on January 11, 1996, and cleared by assessee on January 25, 1996--High sea sales agreement between assessee and consignee in Kumarapalayam on January 2, 1996--Goods transported to Kumarapalayam based on agreement--Nothing on record to show that agreement was make-believe--Sale in course of import--Exempt--Central Sales Tax Act (74 of 1956), s. 5.--State of Tamil Nadu v. Shyam Textiles Pvt. Ltd. (Mad) . . . 429

----Sales tax--Sales to hundred per cent. export oriented undertakings--Condition precedent--Declaration that purchasing unit certified as hundred per cent. export oriented undertaking--Dealer not entitled to exemption in absence of declaration--Karnataka Sales Tax Act (25 of 1957), s. 8A--Notification No. FD 32 CSL 96(V) dated November 15, 1996.--Featherlite Products (P) Ltd. v. Additional Commissioner of Commercial Taxes (Karn) . . . 436

Export oriented unit--Sales tax--Exemption--Sales to hundred per cent. export oriented undertakings--Condition precedent--Declaration that purchasing unit certified as hundred per cent. export oriented undertaking--Dealer not entitled to exemption in absence of declaration--Karnataka Sales Tax Act (25 of 1957), s. 8A--Notification No. FD 32 CSL 96(V) dated November 15, 1996.--Featherlite Products (P) Ltd. v. Additional Commissioner of Commercial Taxes (Karn) . . . 436

Import or export--Sale in course of import--Goods imported by assessee on purchase from Japan on December 7, 1995, entered Chennai Port on January 11, 1996, and cleared by assessee on January 25, 1996--High sea sales agreement between assessee and consignee in Kumarapalayam on January 2, 1996--Goods transported to Kumarapalayam based on agreement--Nothing on record to show that agreement was make-believe--Sale in course of import--Exempt--Central Sales Tax Act (74 of 1956), s. 5.--State of Tamil Nadu v. Shyam Textiles Pvt. Ltd. (Mad) . . . 429

----See also Evasion of tax (Karn) . . . 440

Limitation--Value added tax--Composition of tax--Application for composition--Delay in filing--Application for condonation of delay--Deputy Commissioner (Appeals) and Tax Board on facts condoning delay and allowing dealer to opt for composition--Revision petition--High Court--No interference--Rajasthan Value Added Tax Act (4 of 2003), ss. 3(2), 64.--Assistant Commissioner, Commercial Taxes v. Panna Lal and Company (Raj) . . . 400

----Value added tax--Composition of tax--Delay in filing application under scheme--Application for condonation of delay--Provision in Act enabling acceptance of delayed applications against levy of penalty--Rejection of application merely for delay and without hearing dealer not justified--Dealer's explanation for delay accepted by appellate authorities--Finding of fact--No question of law--Rajasthan Value Added Tax Act (4 of 2003), s. 64.--Assistant Commissioner, Commercial Taxes v. Garg Cold Company (Raj) . . . 396

Penalty--Sales tax--Evasion of tax--Goods carried under documents showing NDDB, a Government concern, as consignee--Driver admitting goods meant for private party--Vehicle intercepted in front of premises of that party far away from NDDB--Carbon copy of bill not found in bill book--Categorical denial by NDDB of any contract with consignor--Levy of penalty justified.--Assistant Taxes Officer v. Pradeep Industries (Raj) . . . 421

----Sales tax--Evasion of tax--Transport of goods imported from outside India--No tax liability--Finding that there was evasion of tax--Perverse--Purchase of machinery by purchaser in Visakhapatnam from Singapore--Purchaser directing goods to be held at Bangalore till site ready for installation--Lorry receipt issued by staff of dealer at Bangalore based on date of commercial invoice issued by seller, even before arrival of goods in India--Explanation of dealer for discrepancy found true--Goods held at godown in Bangalore till transport to Visakhapatnam--All documents accompanying transport--Commercial invoice satisfying all requirements of bill of sale--Nomenclature not relevant--No attempt to evade tax--Levy of penalty unsustainable--Karnataka Sales Tax Act (25 of 1957), s. 28--Karnataka Sales Tax Rules, 1957, r. 23B.--Wipro GE Healthcare P. Ltd. v. Additional Commissioner of Commercial Taxes (Karn) . . . 440

Reassessment--Trade tax--Commissioner--Show-cause notice issued by Additional Commissioner stating material and reason on which approval sought served on assessee--That reason mentioned in notice not incorporated in order granting approval would not render order invalid--No provision to serve order granting approval on assessee--Assessee participating in assessment proceedings challenging order after lapse of 11 months--Challenge not bona fide--On facts issue raised in proceeding, not adjudicated in original assessment--Reason, on which approval granted after application of mind sufficient to form "belief" that there was escaped assessment--Writ petition inter alia challenging order granting approval by Additional Commissioner, consequential assessment and demand of tax--Dismissed--U. P. Trade Tax Act (15 of 1948), s. 21(2).--Jaypee Hotel Ltd. v. State of U. P. (All) . . . 404

Recovery of tax--Sales tax--Immovable property of father-in-law of dealer offered as surety to Department--Department unable to recover from dealer--Attachment and sale of property given as surety--Proper--Writ will not issue to restrain sale--Tamil Nadu General Sales Tax Act (1 of 1959), s. 24(2)(b).--M. Andal v. Commercial Tax Officer (Mad) . . . 432

Surety--Sales tax--Recovery of tax--Immovable property of father-in-law of dealer offered as surety to Department--Department unable to recover from dealer--Attachment and sale of property given as surety--Proper--Writ will not issue to restrain sale--Tamil Nadu General Sales Tax Act (1 of 1959), s. 24(2)(b).--M. Andal v. Commercial Tax Officer (Mad) . . . 432

Value added tax--See Composition of tax (Raj) . . . 396, 400

Writs under Constitution--See Reassessment(All) . . . 404



PRINT EDITION

VOLUME 75 : PART 1 : ISSUE DATED 24-10-2014


SUPREME COURT


Appeal--See National Tax Tribunal (SC) . . . 12

Chartered accountant--National Tax Tribunal--Company secretaries and chartered accountants--Not eligible to represent party to appeal in Tribunal--Section 13 invalid--National Tax Tribunal Act (49 of 2005), s. 13.--Madras Bar Association v. Union of India (SC). . . 12

Company Secretary--See National Tax Tribunal (SC). . . 12

Constitution of India--Jurisdiction--Questions of law--Jurisdiction to decide only with High Courts.--Madras Bar Association v. Union of India (SC). . . 12

----See also Parliament (SC). . . 12

Deferment of tax--See Excise duty (SC) . . . 1

Excise duty--Transaction value--Exclusion--Sales tax actually paid or payable--Retention of 50 per cent. of sales tax collected by prestigious unit by way of tax concession under entitlement certificate issued by State Government--Not a deferment of tax--Sales tax retained constituted part of transaction value--Central Excise Act (1 of 1944), s. 4(3)(d)--Haryana General Sales Tax Act (20 of 1973), ss. 13B, 25A--Haryana General Sales Tax Rules, 1975, r. 28C.--Commissioner of Central Excise v. Maruti Suzuki India Ltd. (SC) . . . 1

Exemption--See Excise duty (SC) . . . 1

High Court--See Parliament (SC). . . 12

----See Constitution of India (SC). . . 12

Judicial review--See Parliament (SC). . . 12

Juridiction--Constitution--Questions of law--Jurisdiction to decide only with High Courts.--Madras Bar Association v. Union of India (SC). . . 12

Legislature powers--National Tax Tribunal Act, 2005--Provision for appointment by select committee consisting of majority of Government officials--Provision for limited tenure and reappointment of members--Provision for appointment of accountant members or technical members of Appellate Tribunal to Tax Tribunal--Provision for Central Government deciding on Benches and seats of Benches--Independence of judiciary affected--Affect basic structure of Constitution--Act invalid--Constitution of India, arts. 226, 227--National Tax Tribunal Act (49 of 2005), ss. 5, 6, 7, 8.--Madras Bar Association v. Union of India (SC). . . 12

----See also Parliament (SC). . . 12

National Tax Tribunal--Company secretaries and chartered accountants--Not eligible to represent party to appeal in Tribunal--Section 13 invalid--National Tax Tribunal Act (49 of 2005), s. 13.--Madras Bar Association v. Union of India (SC) . . . 12

----Constitution of India--Basic structure--Judicial review--Is integral part of basic structure--Westminster model--Parliament--Power to enact legislation to vest adjudicatory functions of High Court in alternative tribunal--Not violative of "basic structure" of Constitution--Parliament must ensure new Tribunal conforms to salient characteristics and standards of court sought to be substituted--Failure to do so--Violative of "basic structure" of Constitution--Constitution of India, arts. 225, 226, 227, 323B--National Tax Tribunal Act (49 of 2005), ss. 5, 6, 7, 8, 13.--Madras Bar Association v. Union of India (SC). . . 12

----National Tax Tribunal Act, 2005--Provision for appointment by select committee consisting of majority of Government officials--Provision for limited tenure and reappointment of members--Provision for appointment of accountant members or technical members of Appellate Tribunal to Tax Tribunal--Provision for Central Government deciding on Benches and seats of Benches--Independence of judiciary affected--Affect basic structure of Constitution--Act invalid--Constitution of India, arts. 226, 227--National Tax Tribunal Act (49 of 2005), ss. 5, 6, 7, 8.--Madras Bar Association v. Union of India (SC). . . 12

Parliament--Constitution of India--Basic structure--Judicial review--Is integral part of basic structure--Westminster model--Power to enact legislation to vest adjudicatory functions of High Court in alternative tribunal--Not violative of "basic structure" of Constitution--Parliament must ensure new Tribunal conforms to salient characteristics and standards of court sought to be substituted--Failure to do so--Violative of "basic structure" of Constitution--Constitution of India, arts. 225, 226, 227, 323B--National Tax Tribunal Act (49 of 2005), ss. 5, 6, 7, 8, 13.--Madras Bar Association v. Union of India (SC). . . 12

----See also National Tax Tribunal (SC). . . 12

Question of law--See Constitution of India (SC) . . . 12

----See Parliament (SC) . . . 12

Sales tax--See Excise duty (SC) . . . 1

Transaction value--Excise duty--Exclusion--Sales tax actually paid or payable--Retention of 50 per cent. of sales tax collected by prestigious unit by way of tax concession under entitlement certificate issued by State Government--Not a deferment of tax--Sales tax retained constituted part of transaction value--Central Excise Act (1 of 1944), s. 4(3)(d)--Haryana General Sales Tax Act (20 of 1973), ss. 13B, 25A--Haryana General Sales Tax Rules, 1975, r. 28C.--Commissioner of Central Excise v. Maruti Suzuki India Ltd. (SC) . . . 1

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