Court quashes circular limiting 'C' form use for petroleum products in GST Act.

The court quashed a circular restricting the use of 'C' forms for inter-state purchases of petroleum products for manufacturing goods under the GST Act. Relying on a previous Division Bench decision, the court directed the respondents to consider the petitioner's claim for 'C' declaration forms for High Speed Diesel Oil purchases within four weeks. The judgment emphasized the right of specific industries like Cement Industries to avail concessional tax rates on such purchases and highlighted the significance of adhering to legal precedents in tax matters.

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Issues:
Challenge to circular dated 31.05.2018 restricting use of 'C' forms for inter-state purchases of petroleum products for manufacturing goods under GST Act, 2017.

Analysis:
The petitioner, a lessee of a limestone quarry and a cement manufacturer, sought concessional tax rates on inter-state purchases of High Speed Diesel Oil (HSD oil) by furnishing 'C' forms. A circular dated 31.05.2018 restricted the use of 'C' forms for such purchases, leading to a penalty notice under Section 10A of the Act. The petitioner challenged this circular, seeking 'C' declaration forms for their HSD oil purchases. The Division Bench had previously ruled in Commissioner of Commercial Taxes, Chennai vs. The Ramco Cements Ltd., stating that the right to purchase restricted goods under the CST Act cannot be denied based on non-sale, ensuring concessional tax rates for specific industries like Cement Industries. The circular was quashed, allowing online downloading of 'C' forms for inter-state purchases of restricted commodities. Following this precedent, the court directed the respondents to consider the petitioner's claim in light of the Division Bench decision within four weeks.

Conclusion:
The court, having considered the previous Division Bench decision and the quashing of the impugned circular, directed the respondents to evaluate the petitioner's claim and issue appropriate orders within four weeks. The writ petition was disposed of without costs, and connected miscellaneous petitions were closed. The judgment upheld the right of industries like Cement Industries to avail concessional tax rates on inter-state purchases of restricted commodities, emphasizing the importance of following legal precedents in tax matters.

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