TaxTMI 
TaxTMI 
2012 (5) TMI 112
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.... Commissioner of Sales Tax to hear an application filed by the petitioner against the order of provisional attachment. 2. The petitioner is a registered dealer under the Maharashtra Value Added Tax Act, 2002 (MVAT Act) and under the Central Sales Tax Act, 1956. It has been averred in the petition that the Assistant Commissioner of Sales Tax, Investigation-3 visited the place of business of the petitioner under Section 64 on 14 October 2011. According to the petitioner on the assumption that certain vendors of the petitioner viz. (i) Accurate Multi Media Pvt.Ltd.; (ii) Ashrita Trading Co.; and (iii) Yashita Trading Co. have not filed returns or proper returns, the Sales Tax authorities considered that the petitioner has claimed wrong Input Tax Credit (Set off) under the MVAT Rules, 2005. On this basis, it is asserted that the First Respondent invoked the provisions of Section 35 and passed an order of provisional attachment on 18 November 2001 which came to be served on the bankers and debtors of the petitioner. The grievance is that the orders of provisional attachment were passed without furnishing an opportunity of a hearing. According to the petitioner since the amount....
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.... Hawala transactions were thus carried out in order to defraud the Revenue. Based on investigation of the Hawala dealers by the Sales Tax Authorities, it was noticed that there was a mismatch in the Input Credit claimed by the petitioner and the tax deposited into the Government treasury by the bogus vendors in respect of the purchases claimed to have been made by the petitioner from them. 5. The affidavit in reply states that during the course of the visit Mitesh Gandhi, a Director of the petitioner gave a statement on 18 October 2011. The Director stated that he had placed oral orders against these purchases from his vendors. He was unable to state the names of the persons on whom the oral purchase orders were placed. By a further communication the petitioner's Director was given an opportunity to appear before the Investigation Officer and produce evidence including lorry receipts, transport receipts and other documents which may prove that he had actually received the goods which he claimed to have purchased from vendors. The Director however, neither attended the investigation process nor did he submit relevant evidence. The investigation also revealed that a person by the ....
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....ase of goods shall exceed the amount of tax in respect of the same goods, actually paid, if any, under this Act or any earlier law, into the Government treasury except to the extent where purchase tax is payable by the claimant dealer on the purchase of the said goods effected by him: Provided that, where tax levied or leviable under this Act or any earlier law is deferred or is deferrable under any Package Scheme of Incentives implemented by the State Government, then the tax shall be deemed to have been received in the Government Treasury for the purposes of this sub-section." 8. On behalf of the State Government it has been submitted in the affidavit in reply that the mere issuance of invoices or filing of returns does not constitute sales. For effecting actual sales, goods must move from the seller to the hands of the buyer. Tax has to be levied and collected by the selling dealer who should deposit this tax in the Government treasury. In other words, without a delivery of goods merely issuance of invoices and filing of returns and passing on credit of tax cannot result in the grant of a set off. 9. With the advent of the MVAT Act with effect from 1 April 2005 a single....
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....pect of any person or dealer or during any inspection or search in relation to the business of any person or dealer, the Commissioner is of the opinion that for the purpose of protecting the interests of the revenue it is necessary so to do, then he may attach provisionally by an order in writing any money due or which may become due to such person or dealer from any other person or any money which any other person holds or may subsequently hold for or on account of such person or dealer. The second proviso to sub-section (1) empowers the Commissioner to revoke such order, if the dealer furnishes a bank guarantee, in such time and for such period, as may be specified. Sub-section (2) provides that an order of provisional attachment would cease to have effect after the expiry of a period of one year from the date of service of the order under sub-section (1). The Commissioner is, however, empowered, for reasons to be recorded in writing, to extend the aforesaid period subject to an over all ceiling that the total period of extension shall not in any case exceed two years. Section 35 contains an in-built provision of a remedy to the person against whom an order of provisional attachm....