2024 (1) TMI 1054 - HC - VAT and Sales Tax

Commercial Tax Tribunal order set aside for failing to note determination points and provide reasons under Rule 63(5) and Section 57(8)

The HC set aside the Commercial Tax Tribunal's order dated 19.03.2008 for non-compliance with mandatory provisions under Rule 63(5) of U.P. V.A.T. Rules, ... Non-compliance of the mandatory provisions laid down under Rule 63(5) of the U.P. V.A.T. Rules, 2008 read with Section 57(8) of the U.P. V.A.T. Act, 2008 - manner and procedure of appeal / summary disposal - whether principle of best judgement assessment can be resorted to on the basis of presumption and surmises, without any material on record or not? - HELD THAT:- From perusal of Section 57 of the Act, 2008 it emerges that the same pertains to Commercial Tax Tribunal. Section 57(5) of the Act 2008 provides that the manner and procedure of summary disposal of appeal shall be as may be prescribed. Section 57(8) of the Act, 2008 provides that the Tribunal after calling for and examining the relevant records and after giving the parties reasonable opportunity of being heard or as the case may be after following the procedure prescribed in Section 57(8)(a) of the Act, 2008 may confirm, cancel or vary such order or (b) set aside the order and direct the assessing or appellate or revising authority or the Commissioner to pass a fresh order or (c) order such amount of tax, fee etc realized in excess to be refunded - the provisions of Order 41 Rule 31 Code of Civil Procedure are akin to Rule 63(5) of the Rules 2008. From perusal of the judgement of this Court in the case of Ved Ram [2004 (7) TMI 704 - ALLAHABAD HIGH COURT] it emerges that this Court has held the provisions of Order 41 Rule 31 Code of Civil Procedure to be mandatory and that the first appellate court while delivering the judgement is required to set out the points for determination, record the decision thereon and give its own reason for the said decision. This Court has further held that failure to comply with these provisions would not be a mere irregularity but would render the judgement nugatory. Accordingly, when the impugned judgement of learned Tribunal is seen in the context of the law laid down by this Court in the case of Ved Ram vis a vis the provisions of Section 57(8) and Section 57(5) of the Act, 2008 read with Rule 63(5) of the Rules, 2008 it clearly emerges that learned Tribunal has patently erred in neither noting the points for determination nor giving the reason for such decision thereon. The order impugned dated 19.03.2008 is set aside - the revision is allowed. Issues Involved:1. Compliance with mandatory provisions under Rule 63(5) of the U.P. V.A.T. Rules, 2008 read with Section 57(8) of the U.P. V.A.T. Act, 2008.2. Application of the principle of best judgment assessment based on presumption and surmises.Summary:Issue 1: Compliance with Rule 63(5) of the U.P. V.A.T. Rules, 2008 and Section 57(8) of the U.P. V.A.T. Act, 2008The revisionist challenged the judgment and order dated 19.03.2018 by the Commercial Tax Tribunal, Lucknow, U.P., arguing non-compliance with Rule 63(5) of the U.P. V.A.T. Rules, 2008 and Section 57(8) of the U.P. V.A.T. Act, 2008. The court examined the provisions, noting that Rule 63(5) mandates that a judgment in appeal must be in writing and state the points for determination, the decision thereon, and the reasons for such decision. This requirement is akin to Order 41 Rule 31 of the Code of Civil Procedure, which has been held as mandatory by the court in the case of Ved Ram Vs Harish Chandra. The court found that the Tribunal's judgment failed to comply with these mandatory provisions, as it did not indicate the points for determination or provide reasons for its decision. Consequently, the judgment was deemed non-compliant with Rule 63(5) and Section 57(8).Issue 2: Principle of Best Judgment AssessmentThe court did not explicitly address the second issue regarding the principle of best judgment assessment based on presumption and surmises in the provided text.Conclusion:The court allowed the revision, setting aside the impugned judgment dated 19.03.2018 to the extent it pertained to Second Appeal No. 68 of 2017. The matter was remitted to the Commercial Tax Tribunal, Lucknow, U.P., for a fresh decision in accordance with the law, ensuring compliance with Section 57 of the U.P. V.A.T. Act, 2008, and Rule 63 of the U.P. V.A.T. Rules, 2008, within three months from the date of receipt of the certified copy of the order.