TaxTMI 
TaxTMI 
2015 (10) TMI 854
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....es tax. 2. Heard Mr. Joseph Markos, learned Senior Counsel appearing for the petitioner. Mr. A. N. R. Jayapratap, learned Additional Government Pleader (Taxes) takes notice for the respondent. 3. The appellant is a bank and it was assessed to tax under Section 22(2) of the Tamil Nadu Value Added Tax Act, 2006 for the assessment years from 2007-2008 to 2010-2011 by the Assessing Officer. Subsequently, it was noticed that the petitioner bank had sold thousands of repossessed vehicles from defaulting customers. On the ground that these sales were not reported in the returns and the necessary tax was not paid, the Assessing Officer resorted to revision of assessment under Section 27(1)(a) of the Act. 4. Aggrieved by the orders of the Asse....
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.....Joseph Markos, learned Senior Counsel appearing for the bank that the petitioner would not come within the expression of the term 'dealer' under Section 2(15). According to the learned Senior Counsel, the bank does not really confiscate the hypothecated vehicle and bring it to sale. By securing necessary transfer forms in TM 29 and TM 30 and bringing the hypothecated vehicles to sale, a bank merely facilitates the sale of the hypothedated vehicles. Further according to the learned Senior Counsel, the sale by the bank of the hypothecated vehicles, was only in the capacity of being an agent of the owner of the vehicle. By itself, the bank is not competent to transfer title in the vehicle to the purchaser. Therefore, the learned Senio....
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....ntains clauses empowering the bank to repossess the vehicle in the event of a default and also to bring the vehicle to sale through public auction or by private negotiation without even involving the owner of the vehicle. 12. As a matter of fact, until the Supreme Court came down heavily upon the arbitrary seizure and sale of hypothecated vehicles by the banks in ICICI Bank Limited Vs. Prakash Kaur [2007 (2) SCC 711], the banks were engaging the services of collection agents to seize the vehicles, repossess them and bring them to sale. Thereafter, the banks started making use of the arbitration clause and invariably, applications are filed under Section 9 of the Arbitration and Conciliation Act, 1996 seeking the appointment of advocate c....
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....ery local branch of a firm or company situated outside the State; (v) a person engaged in the business of transfer otherwise than in pursuance of a contract of property in any goods for cash, deferred payment or other valuable consideration; (vi) a person engaged in the business of transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract; (vii) a person engaged in the business of delivery of goods on hire purchase or any system of payment by instalments; (viii) a person engaged in the business of transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideratio....
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....62. (viii) Customs Department of the Government of India administering the Customs Act, 1962; Central Act II of 1934. (ix) Insurance and Financial Corporations or Companies and Banks included in the Second Schedule to the Reserve Bank of India Act, 1934; (x) Advertising agencies; and (xi) Any other corporation, company, body or authority owned or set up by, or subject to administrative control of the Central Government or any State Government." 15. Under Clause (ix) of Explanation III, the insurance and financial corporations as well as the banks are deemed to be dealers, whenever they dispose of goods under certain contingencies. The contingencies indicated in Explanation III are : (i) dispos....
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....uthorised representative or agent of the owner, but cannot be termed as a dealer. If the person selling it is only an agent of the owner, he cannot be termed as a dealer. 19. However attractive the above contention is, we do not think that it can stand the test of Explanation III. What is made mandatory by certain statutes like the Motor Vehicles Act, 1988, the Registration Act, 1902, etc., are only the registration of certain types of documents. The sale by itself is complete once the transaction is over. For the public to recognize or the courts to recognize such sales, registration is made mandatory in these sales. Explanation III covers all types of cases. Therefore, the said contention cannot be accepted. On the distinction sought t....