1974 (3) TMI 102 - HC - VAT and Sales Tax

Court dismisses application for tax exemption renewal due to missed deadline, emphasizes procedural compliance

The court dismissed the petitioner's application for a writ of certiorari and mandamus to quash an order rejecting the renewal of its exemption ... - Issues: Application for writ of certiorari and mandamus to quash an order rejecting renewal of exemption certificate for sales tax for a co-operative society for the year 1970-71. Interpretation of Rule 5-A of the Orissa Sales Tax Rules regarding the timeline for renewal application.In this case, the petitioner, a co-operative society registered under the Orissa Sales Tax Act, sought a writ of certiorari to quash an order rejecting the renewal of its exemption certificate for the year 1970-71 and mandamus to compel the opposite party to renew the certificate and withhold tax recovery. The society had a history of obtaining exemption certificates, but the application for renewal for 1970-71 was rejected as it was filed after the specified deadline. The rejection was based on Rule 5-A(iii) of the Orissa Sales Tax Rules, which required renewal applications to be made not later than a month before the certificate's expiry date. The application was filed on 2nd March 1970, after the deadline of 1st March 1970, which was considered time-barred. The Commissioner of Sales Tax upheld the rejection, leading to a demand for tax payment from the petitioner.The key issue revolved around the interpretation of Rule 5-A(iii) and the timeline for renewal applications. The rule mandated that renewal applications should be submitted not later than a month before the certificate's expiration date. The petitioner argued that the deadline should be considered as 1st March 1970, as 1st March was a holiday, and the application was submitted on the next working day, 2nd March 1970. Conversely, the standing counsel contended that the deadline was 28th February 1970, a working day, and the application filed on 2nd March 1970 was out of time. The court analyzed the definition of 'month' in the absence of a specific definition in the Act or Rules, concluding that a strict interpretation would require the exclusion of the entire month of March. Relying on precedents, the court emphasized the need for strict compliance with procedures for tax exemptions, leading to the dismissal of the petitioner's application for writs.The judgment highlighted the importance of strict adherence to procedural requirements for tax exemptions, emphasizing that if a specific procedure is outlined in the law for obtaining an exemption, it must be strictly followed. The court upheld the rejection of the renewal application based on the strict timeline stipulated in Rule 5-A(iii) and the general principle of strict construction of exemption provisions. Consequently, the court dismissed the petitioner's application for a writ of certiorari and mandamus, with no order as to costs.