2020 (1) TMI 1339 - HC - VAT and Sales Tax

'Rusk' classified as taxable item under Meghalaya VAT Act Schedule IV; Limitation Act not applicable.

M/s Saj Food Products Versus State of Meghalaya And Ors

The court upheld the classification of 'Rusk' as a taxable item under the residuary entry of Schedule IV of the Meghalaya Value Added Tax Act, 2003. It ... Condonation of delay in filing petition - whether the High Court, while entertaining a Revision Petition against the order of the Appellate Tribunal (the Board of Revenue), by recourse to Section 5 of the Limitation Act, 1963, possesses the power to condone the delay? - Classification of goods - rate of tax - Rusk - HELD THAT:- In the present case delay of 1357 days has been occasioned in filing of the present Revision Petition - the petitioner has furnished satisfying reasons to explain the delay, which according to him constitute sufficient cause within the meaning of Section 5 for condonation of delay. It is not required to go into those reasons if eventually we are persuaded to hold that the provisions of Section 5 of the Limitation Act, 1963 are not applicable for condonation of delay in filing Revision Petition under Section 70 of the Act of 2003. The scheme of the Act of 2003 is though slightly different from the one in Assam Value Added Tax Act, 2003, but what is common between them is that both enactments are intended to be complete code in themselves. The provisions relating to appeal, revision and review are contained in Chapter VII of the Act of 2003. Section 65 thereof provides for remedy of appeal to the assessee against the order of assessment before the Prescribed Authority within 45 days from the receipt of a notice of demand in respect thereof but with the stipulation that appeal may be entertained within such further period as may be allowed by the said authority for the cause shown to his satisfaction. Section 69 (1) of the Act of 2003 has provided for remedy of second appeal before the Appellate Tribunal against the decision of the Appellate Authority and the Revisional Authority, within sixty days. However, Section 69(2) vests the Appellate Tribunal with the power to admit the appeal even after sixty days if it is satisfied that the appellant had sufficient reason for not filing the appeal within the aforesaid time provided it is filed within one year. Obviously, here the discretion of Appellate Tribunal has been restricted allowing it to entertain the appeal beyond sixty days with a rider that such appeal in any case has to be filed within one year, which shall be counted from the date of the notice of the decision to the aggrieved party. It is in such scheme of legislation that the remedy of Revision Petition against the decision of the Appellate Tribunal or the Commissioner has been provided before the High Court under Section 70 of the Act of 2003, which has to be necessarily filed within sixty days, by the assessee after being notified of the decision. Unlike the provisions of Sections 65, 67, 68 and 69 of the Act of 2003, no discretion has been conferred on the High Court to entertain a Revision Petition filed after expiry of sixty days from the date the assessee is notified of the decision. This leads to two conclusions; firstly, the Act of 2003 is a complete Code by itself and secondly, applicability of Section 5 of the Limitation Act to Revision Petition filed under Section 70 of the Act of 2003 stand excluded by necessary implication. Thus, the Act of 2003, especially, Chapter VI with respect to remedy of appeal, revision and review, is a complete Code in itself. Wherever the legislature intended to provide period of limitation for filing of appeal, revision or review petition, it did so by specifically indicating the time period. In the case of revision or review, referable to Sections 66 and 67 respectively, the legislature has not provided any period of limitation. As would be evident from Sections 65, 68 and 69 of the Act of 2003, discretion has been conferred on the appellate authorities concerned to entertain the appeal even beyond the period of limitation - While conferring the discretion on the Appellate Tribunal under Section 69(2) of the Act to entertain the appeal against the decision of the Appellate Authority/Revisional Authority, even after sixty days, on sufficient cause being shown, a rider has been put that such appeal in any case should be filed within one year. Section 70 of the Act of 2003 simply provides for remedy of revision before the High Court against the decision of the Commissioner, within sixty days, but does not confer any discretion on the High Court to entertain the same beyond that period. The applicability of Section 5 of the Limitation Act to Section 70 of the Act of 2003 stands excluded by necessary implication and therefore it would not be applicable to the Revision Petition filed before the High Court under that provision - application for condonation of delay being not maintainable, and is accordingly dismissed - revision petition dismissed. Issues Involved:1. Classification of 'Rusk' under the Meghalaya Value Added Tax Act, 2003.2. Applicability of Section 5 of the Limitation Act to Section 70 of the Meghalaya Value Added Tax Act, 2003.3. Maintainability of the review petition before the Meghalaya Board of Revenue.4. Condonation of delay in filing the Revision Petition.Issue-Wise Detailed Analysis:1. Classification of 'Rusk' under the Meghalaya Value Added Tax Act, 2003:The petitioner, M/S Saj Food Products Pvt. Ltd., argued that 'Rusk' should be classified as 'Branded Bread' under Entry 57 of Schedule I of the Meghalaya Value Added Tax Act, 2003, which exempts it from tax. However, the Assessing Authority, Commissioner of Taxes, and the Meghalaya Board of Revenue classified 'Rusk' under the residuary entry of Schedule IV, making it a taxable item at 13.5%. The authorities held that 'Rusk' undergoes a manufacturing process distinct from bread, thus not qualifying for exemption.2. Applicability of Section 5 of the Limitation Act to Section 70 of the Meghalaya Value Added Tax Act, 2003:The petitioner contended that Section 5 of the Limitation Act, which allows for the condonation of delay, should apply to Section 70 of the Meghalaya Value Added Tax Act, 2003. The court analyzed the scheme of the Act and concluded that the Act is a complete code in itself. Section 70 provides a 60-day period for filing a Revision Petition without any provision for condonation of delay. The court held that the applicability of Section 5 of the Limitation Act is excluded by necessary implication for Revision Petitions under Section 70.3. Maintainability of the Review Petition before the Meghalaya Board of Revenue:The petitioner filed a review petition against the order of the Meghalaya Board of Revenue. The court noted that the Act does not provide for a review of the Appellate Tribunal's decisions. The review petition was dismissed, and the court held that the time consumed in the review process could not be excluded from the limitation period for filing the Revision Petition.4. Condonation of Delay in Filing the Revision Petition:The petitioner sought condonation for a delay of 1357 days in filing the Revision Petition. The court examined whether it had the power to condone the delay under Section 5 of the Limitation Act. It concluded that Section 5 does not apply to Section 70 of the Meghalaya Value Added Tax Act, 2003, as the Act is a complete code and does not provide for such condonation. Consequently, the application for condonation of delay was dismissed, leading to the dismissal of the Revision Petition.Conclusion:The court upheld the classification of 'Rusk' as a taxable item under the residuary entry of Schedule IV of the Meghalaya Value Added Tax Act, 2003. It also ruled that Section 5 of the Limitation Act does not apply to Section 70 of the Act, thereby dismissing the petitioner's application for condonation of delay and the Revision Petition itself.