2020 (10) TMI 907 - HC - VAT and Sales Tax

Court rules dealers entitled to 'C' Forms for purchasing diesel outside state for tax benefits

M/s. Munichandrappa & Co. Versus The Principal Commissioner and Commissioner of Commercial Taxes, The Assistant Commissioner (ST), The Joint Commissioner (ST)

The court ruled in favor of the petitioners, emphasizing that all dealers are entitled to 'C' Forms for purchasing High Speed Diesel from suppliers ... Concessional benefit of tax - purchase of High Speed Diesel from suppliers in other States - difficulty in obtaining 'C' forms under the provisions of the Central Sales Tax Act, 1956 - HELD THAT:- In the case of M/S. DHANDAPANI CEMENT PRIVATE LTD., M/S. TERU MURUGAN BLUE METAL VERSUS THE STATE OF TAMIL NADU, THE PRINCIPAL COMMISSIONER & COMMISSIONER OF COMMERCIAL TAXES, THE ASSISTANT COMMISSIONER (ST) , THE JOINT COMMISSIONER (ST) TERRITORIAL, THE DEPUTY COMMISSIONER (ST) [2019 (2) TMI 1850 - MADRAS HIGH COURT], wherein the identical issue as arising before me has been considered and decided holding that Upon enquiry with the Assessing Authorities, they have been informed that the benefit of the decision in M/S. THE RAMCO CEMENTS LTD. VERSUS THE COMMISSIONER OF COMMERCIAL TAXES, THE ADDITIONAL COMMISSIONER (CT) [2018 (10) TMI 1529 - MADRAS HIGH COURT] Ltd can be extended only to those dealers in that are party to the decision. This stand is unacceptable in so far as the decision of this Court as well as other High Courts, one of which has been confirmed by the Supreme Court, are decisions in rem, applicable to all dealers that seek benefit thereunder, of course, in accordance with law. The State has, after the date of the above order, filed a Writ Appeal challenging the decision in the case of Ramco Cements (Supra) that has been considered and dismissed by a Division Bench of this Court on 09.03.2020. Though she submits that the State intends to file further appeal order dated 09.03.2020 prevails as on date. Petition allowed. Issues:1. Entitlement to 'C' Forms for purchase of High Speed Diesel from suppliers outside Tamil Nadu to avail concessional benefit of tax.Analysis:The judgment addressed the issue of entitlement to 'C' Forms for the purchase of High Speed Diesel from suppliers outside Tamil Nadu to avail the concessional benefit of tax. The court referred to a previous decision in the case of M/s. Ramco Cements Ltd. where it was held that the benefit of the concessional rate is available to dealers who purchase High Speed Diesel from neighboring states through inter-state sales. This decision was supported by various other court judgments, including the Punjab and Haryana High Court, which was confirmed by the Supreme Court. The court emphasized that the benefit applies to all dealers seeking it, in accordance with the law.The Government Advocate did not dispute this position but mentioned the State's intention to challenge the order in the Ramco Cements case. However, until the order is stayed or reversed, all Assessing Authorities within Tamil Nadu must apply the rationale of the decision to all pending assessments. The court found the stand of the Assessing Authorities, limiting the benefit only to parties of the specific case, unacceptable. The court clarified that decisions like these are applicable to all dealers seeking the benefit, as they are decisions in rem.Subsequently, the court allowed the Writ Petitions, directing necessary action by the department without imposing any costs. The judgment highlighted the need for the State to comply with the decision until any appeal alters the situation. The court reiterated its stance based on previous judgments and emphasized the uniform application of the decision to all concerned parties. The judgment in the Writ Appeal further confirmed the decision, leading to the allowance of the writ petition and closure of connected miscellaneous petitions.