2016 (1) TMI 908 - HC - VAT and Sales Tax

High Court emphasizes adherence to time limits for appeals under Value Added Tax Act, cautions against overreliance on revisional powers.

Larsen And Toubro Ltd & 1 Versus State of Gujarat & 2

The High Court set aside the revisional order dated 15.07.2015 by the Commissioner of Commercial Tax, emphasizing adherence to the Value Added Tax Act's ... VAT Commissioner revised the order u/s 75 of GVAT and raised the demand - It is this order that the petitioners have challenged in this petition primarily on the ground that merely because the judgment of the Tribunal, which was in favour of the petitioner, has been carried in appeal by the Department, would not be ground to enable the Commissioner to exercise revisional powers and set aside the order of appellate authority. Held that:- the course adopted by the Commissioner is wholly erroneous. - The judicial discipline required that the Commissioner did not ignore such pronouncement of the Tribunal. Merely because the Department was aggrieved by such judgment and challenged the same before the High Court, would not be ground enough to enable the Commissioner to exercise revisional powers and to set aside the order of appellate authority. At best, the Department, in order to pursue the issue further, could and in fact ought to have filed appeal against the order of the Joint Commissioner. - Decided in favor of assessee. Issues:Challenge to revisional order dated 15.07.2015 by the Commissioner of Commercial Tax regarding assessment year 1994-95. Interpretation of the Value Added Tax Act, 2003 regarding revisional powers, appellate authority's order, and Tribunal's judgment.Analysis:The petitioners challenged a revisional order dated 15.07.2015 passed by the Commissioner of Commercial Tax concerning the assessment year 1994-95. The appellate authority had allowed the appeal in favor of the petitioners on 18.07.2011. However, the Commissioner, despite a judgment in favor of the petitioners by the VAT Tribunal on identical issues, issued a notice to revise the appellate order. The petitioners argued that the Commissioner's revisional powers should not be based solely on the Department's appeal to the High Court against the Tribunal's judgment. The Government contended that revisional powers could be exercised within the time period, which would lapse if no action was taken pending the High Court appeal. The High Court found the Commissioner's course of action erroneous, emphasizing that the Commissioner should not ignore the Tribunal's judgment in favor of the assessee. The Department should have filed an appeal against the Joint Commissioner's order instead of seeking revisional powers based on their disagreement with the Tribunal's decision.The High Court set aside the impugned order dated 15.07.2015, highlighting the provisions of the Value Added Tax Act regarding time limits for filing appeals. Section 73 of the Act specifies the time limit for appeals, while Section 77 incorporates the provisions of the Limitation Act for computing the period of limitation. Additionally, Section 84 of the Act empowers the appellate authority to admit appeals beyond the limitation period if sufficient cause is shown for the delay. The Tribunal has the authority to ignore the period during which a remedy was pursued in good faith or to condone the delay for sufficient cause. The Department is responsible for taking appropriate action to challenge an appellate order in accordance with the law. The High Court emphasized that in this case, the exercise of revisional powers was not the correct approach, and the Department should have pursued an appeal instead.In conclusion, the petition was disposed of accordingly, emphasizing the importance of following the legal procedures outlined in the Value Added Tax Act and the Limitation Act for challenging appellate orders. The judgment underscores the significance of respecting the decisions of the Tribunal and the appropriate avenues for appeal rather than resorting to revisional powers based solely on disagreement with the Tribunal's judgment.