TaxTMI 
TaxTMI 
2016 (1) TMI 1222
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.... for the said purpose the petitioner company imports raw materials and other ancillaries including eligible and permissible chemicals and other ingredients like flavor, essence, maize starch, packing materials like corrugated box, caps, bottles etc. from the places outside the State of Assam for use in manufacture of medicine and for its sale, in the course of Intra-State as well as in the course of Inter-State Trade or commerce in the course of their said business. 3. As endorsed by the petitioner company during the year 2005-06 the petitioner Company imported 112 items of raw materials from outside the State amounting to Rs. 8,42,12,433/- and further incurred transportation charges of Rs. 25,00,486/- to bring those raw materials into its industrial unit. But the petitioner company while endorsing the said value excluded the inward freight, transit insurance etc. 4. To levy entry tax on import of specified goods imported in to the local area of the State of Assam from outside the local area including outside that of the State of Assam for consumption, use and sale therein, the State Government enacted the Assam Entry Tax Act, 2008 and the schedule attach to....
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....f penalty equal to 25% of the Tax. Sd/- Illegible (K.Lahary) Assistant Commissioner of Taxes Central VAT Audit Team Attached to the Office of the Commissioner of Taxes, Assam Dispur, Guwahati-6" 7. On 31.03.2011 the said respondent No. 3 under the provisions of the Section 8 of the Assam Entry Tax Act and Section 37 of the Assam Value Added Tax Act passed an assessment order against the petitioner's company for the period of 2005-06 on aggregate amount of import value of Rs. 8,67,12,919/- levying tax on the import value of raw materials amounting to Rs. 8,42,12,433/- treating the same to be chemicals falling under Entry No. 51 of the Schedule attached to Assam Entry Tax Act, 2008 and also determined freight element amounting to Rs. 25,00,486/-. The said assessment order dated 31.03.2011 also reveals that the case of the dealer, i.e. the petitioner company was selected for assessment under Section 36 of the Assam Value Added Tax Act read with Rule 22 of the Assam Value Added Tax Rules, 2005 read with Section 8 of the Assam Entry Tax Act, 2008 read with Rule 6 of the Assam Entry Tax Rules, 2008 and in spit....
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....year was up to 31.03.2006. 11. The revisional authority, i.e. the Joint Commissioner of Taxes, Assam vide order dated 26.06.2013 passed under Memo No. CVAT-1/2011/(39) while disposing of the revision petition of the petitioner Company under Section 82 of the Assam Value Added Tax Act, 2003, against the assessment order dated 31.03.2011 passed by the Assessing Officer, found that the notice issued vide CTVA-4/2009/13 dated 25.03.2011 was elaborately described, whereas Form 21 does not have such point to describe elaborately. The revisional Court also found that the said notice under Section 37 was the consequence of non-compliance of the notice issued in Form 20 as prescribed under Rule 22 of the Assam Value Added Tax Rule 2005 and that except the four goods mentioned in the Statement of imported goods by the petitioner company (Serial Nos. 49, 68, 91, 98) all are chemicals and is taxable @ 2% as per entry at Sl. No. 51 of the Schedule of the specified goods w.e.f. 28.02.2005 as per Govt. Notification No. FTX.146/2006/121 dated 28.02.2005. The revisional Court vide order dated 26.06.2013 came to the conclusion that the Assessment order dated 31.03.2011 passed by the Assista....
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....2011 directing it to appear 30.03.2011 and rejected the prayer of the appellant petitioner company for fifteen days more time to respond the said notice. The said appellate authority also observed that the notice to show cause is given not only to fulfill a mere technicality but to enable the assessee to present his case with proper details and to defend the same. 14. In view of the above, the appellate authority i.e. the ABR by its judgment dated 26.06.2014, without going into the merit of the case against the said order of the revisional authority, dated 26.06.2013 came to the conclusion that the Assessing Officer did not adhere to the basic tenets of the provisions of the natural justice enabling the assessee to present his case to defend him properly. Accordingly, the ABR allowed the appeal preferred by the petitioner company and remanded back the matter to the Assessing Officer to pass a fresh order, by giving a reasonable opportunity to the assessee to present his case, with the observation that the entire exercise shall be done expeditiously and in any case within two months time. 15. Thereafter, pursuant to the two notices bearing Nos. 17....
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....ed 26.06.2014 passed by the learned Assam Board of Revenue in case No. 85 STA/2013, noted above, passed fresh assessment order dated 28.08.2015 with regard to the petitioner company for the assessment year 2005-06 under the Assam Entry Tax Rules determined total value of goods imported at Rs. 8,63,37,767/- and tax @2% assessed at Rs. 17,26,755/- and also assessed the interest @ Rs. 9,56,996/- w.e.f. 28.02.2011 and total sum due of Rs. 22,50,151/-.Being aggrieved with said re-assessment order dated 28.03.2015 of the concerned assessing officer preferred this petition on the ground that such determination of Assessing Officer was purely mechanical without discharging the burden cast upon him to prove that the said items were classifiable under Entry 51 of the Schedule attached to Assam Entry Tax Act, 2008. The petitioner reiterated that the bulk raw materials that the petitioner company made inter-State purchase during the year 2005-06 were mainly drugs which were to be used in the manufacture of medicines and some of them were vitamins and the Assessing Officer without considering the materials produced by the petitioner levied entry tax on 107 nos. of items out of 112 i....
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....e/the petitioner has nothing to say in respect the case and accordingly proceeded to assess the said importer. 19. In the case of HPL Chemicals Limited -Vs- Commissioner of Central Excise, Chandigarh reported in 2006 (5) SCC 208, the Hon'ble Supreme Court have held as follows: "28. This apart, classification of goods is a matter relating to chargeability and the burden of proof is squarely upon the Revenue. If the Departments intends to classify the goods under a particular heading or sub-heading different from that claimed by the assessee, the Department has to adduce proper evidence and discharge the burden of proof. In the present case the said burden has not been discharged at all by the Revenue. On the one hand, from the trade and market enquiries made by the Department, from the report of the Chemical Examiner, CRCL and from HSN, it is quite clear that the goods are classifiable as "denatured salt" falling under Chapter Heading 25.01. The Department has not shown that the subject product is not bought or sold or is not known or is dealt with in the market as denatured salt. The Department's own Chemical Examiner after examining the chemical composition has....
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.... of establishing that the said rings fell within Item 22-F lay upon the Revenue. The Revenue led no evidence. The onus was not discharged. Assuming therefore, that the Tribunal was right in rejecting the evidence that was produced on behalf of the appellants, the appeal should, nonetheless, have been allowed." " 20. In the case of Voltas Ltd. Vs. State of Gujrat reported in (2015) 7 SCC 527 the Hon'ble Supreme Court has held that: "26. Qua the issue of classification of goods to determine the chargeability thereof and the rates of levy applicable, it is no longer res-nnintegra that the burden of proof is on the taxing authority to demonstrate that a particular class of goods or item in question is taxable in the manner claimed by them and that mere assertion in that regard is of no avail as has been enunciated by this Court in U.O.I. & Ors. vs. Garware Nylones Ltd.etc. (1996) 10 SCC 413 and relied upon with approval in HPL Chemicals Ltd. vs. Commissioner of Central Excise, Chandigarh (2006) 5 SCC 208". 21. In the case of the State of Kerala Vs. C. Velukutty reported in (1966) 60 ITR 239 with regard to best judgment assessment the Hon'ble Apex Cour....