TaxTMI 
TaxTMI 
2014 (5) TMI 416
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....to as 'the Act'). All those petitioners, while carrying on the business, have been purchasing Liquefied Petroleum Gas (LPG). Hence, the petitioners and each of them had hitherto been claiming input tax credit under Section 13 of the Act on the purchases of taxable goods from other VAT dealers. The State of Andhra Pradesh (hereinafter referred to as "State") has issued a notification in G.O.Ms.No.503, dated 08-05-2009 amending certain Schedules and also Rules to the Act w.e.f. 01-05-2009. One of the amendments is insertion of clause (q) in Rule 20(2) of the Andhra Pradesh Value Added Tax Rules, 2005 (hereinafter referred to as "the Rules"). The said insertion is as follows: "Furnace Oil, LSHS and other similar fuels, used in the furnaces and boilers of the factories or manufacturing or processing units." The respondent-authorities, in view of the said insertion, are treating the LPG as being other similar fuels within the aforesaid amendment and thereby they are refusing to allow the input tax credit to each of the petitioners- dealers. Accordingly, the respondent-authorities have been assessing the tax and passing assessment orders. It appears that the respondent-authorit....
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.... and demanding tax, is subject matter of Appeal in T.A.No.341 of 2012 filed by M/s. Hindustan Unilever Limited and hence, the respondent-authorities cannot proceed on the basis of such decision of the ARA. 4. Though all the above points have been taken primarily, at the time of hearing, learned counsel for the petitioners did not advance those arguments and restricted their arguments on the following points: 5. It is submitted that the ARA is a concept really borrowed from Chapter XIXB of the Income Tax Act, 1961. Learned counsel for the petitioners submits further that the decision of the ARA would be binding, as it appears from Section 245S of the Income Tax Act, on the following persons and situations: (a) on the applicant who had sought it; (b) in terms of the transaction in relation to which the ruling had been sought; and (c) on the Commissioner, and the income tax authorities subordinate to him, in respect of the applicant and the said transaction. 6. Then, it is contended that the advance ruling referred to in sub-section (1) shall be binding as aforesaid unless there is a change in law or facts on the basis of which the advance ruling has been pronounced. Learned cou....
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.... Unilever Limited's case clarified that LPG is covered by the said amended provisions of the Rules to deny the benefit of input tax credit. In Hindustan Unilever Limited's case, the subject matter was LPG as it is in all the cases on hand. Hence, by the word 'goods', denote whoever purchases LPG will be bound by the aforesaid decision of the ARA. Learned counsel relying upon a decision of a Division Bench of this Court in case of TIRUPATI CHEMICALS v. DEPUTY COMMERCIAL TAX OFFICER, (VMU-I) NO.1 DIVISION, VIJAYAWADA (2011) 40 VST 81 (AP), contends that the aforesaid judgment is the authority to hold what has been contended by him. The orders passed relying upon the decision of the ARA are perfectly lawful and the remedy of all the petitioners lies before the appropriate forum by way of appeal and the writ Court cannot entertain these actions in view of the alternative remedy. 9. After considering the rival contentions, the only point, which has been called upon to be decided by this Court, is whether going by the language in Section 67(4) of the Act reading with Section 245S of the Income Tax Act, the decision of the ARA will bind the third parties or not? 10. In t....
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.... said amended Rule is applicable in order to disqualify any dealer to get the input tax credit. Therefore, going by the aforesaid interpretation, although the petitioners are non-applicants, the decision is binding upon them. We are unable to accept the contention of the learned counsel for the petitioners that the provision of sub- section (4) of Section 67 of the Act is similar to that of the provision of Section 245S of the Income Tax Act, as it will appear from the comparative study of both the provisions that the same are substantially dissimilar. We, therefore, set out the provision of Section 245S of the Income Tax Act as follows: "245S. (1) The Advance ruling pronounced by the Authority under Section 245R shall be binding only - (a) on the applicant who had sought it; (b) in respect of the transaction in relation to which the ruling had been sought; and (c) on the Commissioner, and the income-tax authorities subordinate to him, in respect of the applicant and the said transaction. (2) The advance ruling referred to in sub-section (1) shall be binding as aforesaid unless there is a change in law or facts on the basis of which the advance ruling has been pronounced." 1....
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....ely helpful. In that case, the Court dealt with the questions upon whom the Advance Ruling under Section 67(4) of the Act would be binding. At page 91 of the report, the Court formulated one of the points as follows: "Is the ruling of the ARA binding on the dealers other than the applicant dealer who sought the clarification." 16. In the above case, the Division Bench of this Court, while considering the same arguments as advanced here, in clear terms came to the finding at page-97 of the report as follows: "On a literal construction of clause (ii) of Section 67(4), it is evident that the order of the ARA would be binding "in respect of the goods or transactions in relation to which a clarification was sought" irrespective of whether such goods or transactions relate to the applicant or other dealers." Again at page 98, the Court reiterated the same finding as follows: "The legislature has, under Section 67(4)(ii), made the ruling of the ARA binding in respect of goods or transactions in relation to which a clarification is sought, and has not restricted its applicant only to the applicant. Notwithstanding that the clarification has been given at the behest of the applicant-dea....
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....2004) 11 SCC 625]. The court cannot rewrite, recast or reframe the legislation as it has no power to do so. Even if there is a defect or an omission in the statute, the Court cannot, ordinarily, correct the defect or supply the omission. [See Union of India v. Deoki Nandan Aggarwal (1992) Supp 1 SCC 323; Shyam Kishori Devi v. Patna Municipal Corpn. AIR 1966 SC 1678; Satheedevi v. Prasanna (2010) 5 SCC 622]. 20. Under the circumstances as above, the provision of the statute has to be accepted and applied as it is. Of course it is to be noted that the decision means, decision rendered on the ratio and that part is binding. Such decision or judgment of the Supreme Court or High Courts in a particular point of law is binding upon not only the parties thereto but also the non-parties on a similar identical point although they are not heard. It seems in this piece of legislation, the same legal principle has been made applicable. 20A. In view of the foregoing discussion, we hold that decision of ARA rendered on the application of Hindustan Unilever Limited in AR.Com.6/2011 dated 18-07-2012 is binding upon other non-applicant dealers who are dealing in LPG until it is set aside. 21. An....