2016 (5) TMI 1189 - HC - VAT and Sales Tax

Court Upholds Decision on Purchase Tax & Input Tax Credit Dispute

The High Court dismissed the appeals, upholding the decisions of the lower authorities regarding the assessment of purchase tax and denial of Input Tax ... Demand of purchase tax - Input tax credit disallowed - Whether the Tribunal was justified in ignoring the judgment of M/s Gobind Sugar Mills and following the judgment of M/s Jagatjit Sugar Mills case despite the fact that the issue and facts in Govind Sugar Mills case are almost identical to the issues and facts of the present case and whether the appellant is liable to pay tax on the purchase of sugarcane under the provisions of Punjab General Sales Tax Act, 1948, when the Punjab Sugarcane (Regulation of Purchase & Supply) Act, 1953 is in force which is a special Act - Held that:- the issue stands concluded against the appellant by this Court in the case of M/s AB Sugars Ltd. v. State of Punjab and another [2015 (8) TMI 62 - PUNJAB & HARYANA HIGH COURT]. Therefore, by following the same the appeal is concluded. - Decided against the appellant Issues:1. Condonation of delay in payment of court fee.2. Appeal against the order of the Value Added Tax Tribunal.3. Assessment of purchase tax and denial of Input Tax Credit.4. Applicability of previous judgments on the current case.Issue 1: Condonation of Delay in Payment of Court FeeThe appellant filed an application under Section 149 of the Code of Civil Procedure seeking condonation of delay in payment of the shortfall in court fee. The deficiency in court fee was rectified, and the court allowed the application, condoning any delay in making good the deficiency in court fee.Issue 2: Appeal Against the Order of the Value Added Tax TribunalThe appellant, an assessee under the Punjab Value Added Tax Act, 2005, challenged the order of the Value Added Tax Tribunal in Appeal No. 11 of 2015 for the assessment year 2011-12. The Tribunal upheld the orders of the Assessing Authority and the Deputy Excise and Taxation Commissioner, dismissing the appellant's appeal. The appellant, dissatisfied with the decision, filed the present appeals.Issue 3: Assessment of Purchase Tax and Denial of Input Tax CreditThe appellant, a sugar mill operator, procured sugar cane directly from farmers for manufacturing sugar and its by-products. The Assessing Authority levied purchase tax, including the Statutory Minimum Price and the amount paid by the appellant on the State's direction. The appellant did not consider the latter amount for tax calculation and deposit. Additionally, the Assessing Authority denied Input Tax Credit on the purchase tax as per Section 19(5) of the Act, creating an additional demand. The appeals were filed challenging these assessments.Issue 4: Applicability of Previous JudgmentsThe Court noted that the issues raised in the present appeals had been previously considered in VATAP No. 176 of 2013. The Court referred to the substantial questions of law from the previous case, where the Tribunal's decision was upheld against the appellant. The Court emphasized that it could not deviate from the Supreme Court's decision in a similar matter and dismissed the present appeals in line with the previous judgment.In conclusion, the High Court dismissed the appeals, citing the precedent set in a previous case where similar issues were addressed. The Court upheld the decisions of the lower authorities regarding the assessment of purchase tax and denial of Input Tax Credit, based on the principles established in the earlier judgment.