2013 (3) TMI 568 - HC - VAT and Sales Tax

Court dismisses writ petition challenging assessment order, advises appeal within two weeks.

The court dismissed the writ petition challenging the assessment order, advising the petitioner to appeal within two weeks. The court directed the ... Alternative Claim - Disallowing Exemption claimed from payment of tax u/s. 6(2) of the Central Sales Tax Act, 1956 in respect of some local sales - The petitioner supplies specified goods and equipments to PGCIL and NTPC, the movement of which is occasioned from a State other than Odisha(Exemption U/s 6(2) of the CST Act.) - Escaped assessment and resulted in evasion of VAT - Held that:- Law is well settled that when the statute requires to do certain thing in certain way, the thing must be done in that way or not at all. Other methods or mode of performance are impliedly and necessarily forbidden. The aforesaid settled legal proposition is based on a legal maxim “Expressio unius est exclusion alteris”, meaning thereby that if a statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner and following of other course is not permissible. At the time of scrutiny of the return under any of the provisions of the statute the assessee is required to adduce evidence in support of his particulars disclosed in the return/revised return validly filed under the statute including the claim of exemption/deduction. Whether the assessee can change its stand in course of reassessment proceeding under Section 43 of the OVAT Act when its claim of exemption under Section 6(2) of the CST Act is disallowed on the basis of a tax evasion report and the dealer is entitled to take altogether a different stand and to submit new evidence in support of its changed stand? In view of the above, if the petitioner fails to establish its claim of exemption under Section 6(2) of the CST Act made in its return, the appellate authority while dealing with its alternative prayer claiming exemption under Notification No.629/2008 dated 23.12.2008 shall adjudicate various issues arise out of such claim. Here the writ petition is dismissed. Issues Involved:1. Legality and validity of the assessment order dated 29.10.2011.2. Entitlement to exemption from payment of tax under Section 6(2) of the CST Act.3. Treatment of transactions as intra-state sales.4. Exemption under Notification No.629/2008 dated 23.12.2008.5. Jurisdiction of the Assessing Officer.6. Principles of natural justice.7. Alternative remedy of appeal.Issue-wise Detailed Analysis:1. Legality and Validity of the Assessment Order:The petitioner challenged the assessment order dated 29.10.2011, arguing that it was passed without jurisdiction and violated principles of natural justice. The assessment was reopened based on a tax evasion report alleging escaped assessment and VAT evasion. The petitioner contended that the Assessing Officer's findings were erroneous and that the transactions were inter-state sales exempt under Section 6(2) of the CST Act.2. Entitlement to Exemption from Payment of Tax under Section 6(2) of the CST Act:The petitioner claimed exemption under Section 6(2) of the CST Act for sales made to PGCIL and NTPC, arguing that these were 'in-transit sales' occasioned by inter-state movement of goods. The Assessing Officer rejected this claim, stating that the transactions did not meet the criteria for exemption under Section 6(2) as the goods were received and verified by the petitioner's representative within Odisha before being handed over to the agencies, thus constituting intra-state sales.3. Treatment of Transactions as Intra-state Sales:The Assessing Officer concluded that the sales were intra-state transactions because the petitioner's representative received the goods within Odisha and then delivered them to the agencies after verification. This conclusion was based on the absence of endorsement of sale by transfer of documents of title to goods during transit, which is a requirement under Section 6(2) of the CST Act.4. Exemption under Notification No.629/2008 dated 23.12.2008:The petitioner alternatively argued that even if the sales were treated as intra-state, they should be exempt under Notification No.629/2008. The Assessing Officer denied this exemption due to the petitioner's failure to submit the requisite certificates from PGCIL and NTPC. The petitioner later obtained these certificates and requested the Assessing Officer to reconsider, but the request was denied.5. Jurisdiction of the Assessing Officer:The petitioner argued that the Assessing Officer lacked jurisdiction to impose tax on inter-state sales, which should be taxed by the state from which the goods originated. The Assessing Officer's actions were claimed to be beyond legislative competence, violating Article 286 of the Constitution of India.6. Principles of Natural Justice:The petitioner contended that the assessment order was passed without following the principles of natural justice, as they were not given adequate opportunity to present their case or submit necessary documents.7. Alternative Remedy of Appeal:The court noted that the petitioner has a substantive statutory right to appeal under the OVAT Act, which includes provisions for first and second appeals. The appellate authority, being a fact-finding body, is better suited to adjudicate the disputed facts and legal contentions. The court directed the petitioner to approach the First Appellate Authority within two weeks, which would adjudicate all issues after affording an opportunity of hearing.Conclusion:The writ petition was dismissed, and the petitioner was advised to file an appeal within two weeks. The appellate authority was directed to consider all factual and legal contentions, including the alternative claim for exemption under Notification No.629/2008. The court emphasized the importance of adhering to statutory procedures and the necessity of fact-finding by the appropriate authority.