TaxTMI 
TaxTMI 
2017 (4) TMI 1000
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....16, W.P. No. 27256(W) of 2016, W.P. No. 26458(W) of 2016, W.P. No. 26737 (W) of 2016, W.P. No. 4989(W) of 2017, W.P. No. 5383(W) of 2017, W.P. No. 5085(W) of 2017, W.P. No. 5360(W) of 2017, W.P. No. 5338(W) of 2017, W.P. No. 4221(W) of 2017, W.P. No. 4397(W) of 2017, W.P. No. 4216(W) of 2017, W.P. No. 4369(W) of 2017, W.P. No. 4223(W) of 2017, W.P. No. 3969(W) of 2017, W.P. No. 4218(W) of 2017, W.P. No. 3975(W) of 2017, W.P. No. 3971(W) of 2017, W.P. No. 4057(W) of 2017, W.P. No. 4067(W) of 2017, W.P. No. 4213(W) of 2017, W.P. No. 5072(W) of 2017, W.P. No. 5328(W) of 2017, W.P. No. 5074(W) of 2017, W.P. No. 5580(W) of 2017, W.P. No. 5577(W) of 2017, W.P. No. 5582(W) of 2017, W.P. No. 5915(W) of 2017, W.P. No. 5914(W) of 2017, W.P. No. 5909(W) of 2017, W.P. No. 6168(W) of 2017, W.P. No. 6041(W) of 2017, W.P. No. 5983(W) of 2017, W.P. No. 5512(W) of 2017, W.P. No. 4209(W) of 2017, W.P. No. 6416 (W) of 2017, W.P. No. 6417(W) of 2017, W.P. No. 6444(W) of 2017, W.P. No. 6810(W) of 2017, W.P. No. 6779(W) of 2017, W.P. No. 6605(W) of 2017, W.P. No. 6204(W) of 2017, W.P. No. 6205(W) of 2017, W.P. No. 6381(W) of 2017, W.P. No. 6382(W) of....
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....mpex Pvt. Ltd. Versus The Deputy Commissioner Commercial Taxes, Bhawanipore Charge & Ors. ,Amit Malani, Proprietor of M/s. Classic Collection Versus The State of West Bengal & Ors. ,IAC Electricals Pvt. Ltd. Versus Senior Joint Commissioner of Commercial Taxes, Kolkata South Circle & Ors. ,Yaash Steel Products Pvt. Ltd. Versus Deputy Commissioner, Sales Tax, Bhawanipore Charge & Ors. ,Supreme Wood Products Pvt. Ltd. Versus Senior Joint Commissioner of Commercial Taxes, Corporate Division & Ors. ,M/s. Universal Construction Co. Versus Sales Tax Officer, Durgapur Charge & Ors. ,Shristi Infrastructure Development Corporation Ltd. Versus Deputy Commissioner of Commercial Taxes, Central Audit Unit-II, Salt Lake & Ors. ,Kohinoor Paper & Newsprint Pvt. Ltd. Versus Senior Joint Commissioner, Kolkata South Circle & Ors. ,Bluechip Concrete Pvt. Ltd. Versus Sales Tax Officer, Posta Bazar Charge & Ors. ,Faneesh Mishra Versus Sales Tax Officer, Salt Lake Charge & Ors. ,Shristi Infrastructure Development Corporation Ltd. Versus Deputy Commissioner of Commercial Taxes, Central Audit Unit-II, Salt Lake & Ors. ,Pradeep Structural Development Pvt. Ltd. Versus Sales Tax Officer, Shibpur Charge & Ors.....
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....equires payment of tax in dispute for the purpose of maintaining an appeal against an order in original. The requirement of payment is an exaction rather than a pre-deposit. The Act does not postulate a pre-deposit. Since the word used is payment in the second proviso and the effect is an exaction of a tax, the same is beyond the legislative competence of the state legislature. Tax in dispute is not defined under the Act of 2003. What is defined is "tax due". The word payment and pre- deposit are different. The word payment used in the second proviso of Section 84(1) of the Act of 2003 cannot be read to be a deposit as the same would do violence to the plain meanings of the words used in the later part of such proviso following the word payment. Reliance is placed on the dictionary meaning of the words payment and deposit. Reliance is placed on All India Reporter 2010 Calcutta page 161 (Secretary, West Bengal Council of Higher Secondary Education v. Soumyadeep Banerjee & Ors.) and All India Reporter 1988 Supreme Court page 1263 (Commissioner of Income Tax, U.P.- II, Lucknow v. Bazpur Co-operative Sugar Facto....
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....contended on behalf of the petitioners that, the restriction sought to be imposed by the amended provisions of Section 84 for the purpose of preferring an appeal are not reasonable. The introduction of the date of April 1, 2015, in the second proviso is arbitrary and discriminatory. It discriminates amongst similarly situated and circumstanced assessees in the sense that, an assessing officer for an assessee may have disposed of an assessment of a particular assessment year prior to April 1, 2015, while another assessing officer may not have disposed of the same assessment year before April 1, 2015. Therefore, two assesses would be required to file appeals under two different provisions of law for the same assessment year when the assessees are not at fault. An order of assessment passed after April 1, 2015, would require a payment of 15% of the amount of tax in dispute to maintain the appeal while an order for the same assessment year passed in respect of another assessee would not attract the rigours of the second proviso if the same was passed prior to April 1, 2015. This would discriminate between two assesses for the same assessment year. The introduction of paymen....
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....2 (State of Madhya Pradesh v. Rakesh Kohli), 2003 Volume 11 Supreme Court Cases page 405 (The Assistant Commissioner, Assessment-II, Bangalore & Ors. v. M/s. Velliappa Textiles Ltd. & Anr.), All India Reporter 1969 Supreme Court page 430 (Income Tax Officer v. M.K. Mohammed Kunhi) and All India Reporter 1980 Supreme Court 1285 (Jit Ram Shiv Kumar & Ors. v. State of Haryana & Anr.). The requirement of payment of 15% of the tax in dispute would cause undue hardship to an assessee. In a given case, the assessment order may be horribly wrong and may impose an astounding outstanding which an assessee may not be able to challenge in an appeal due to the onerous condition of payment of 15%. The requirement of 15% payment to prefer an appeal also discriminates between a financial sound assessee and one who is not so financially sound. A financially unsound assessee would find it hard to prefer an appeal by reason of the onerous conditions. The right to prefer an appeal would then stand curtailed so far as such assessee is concerned. An assessee has a right to appeal. It is now sought to be restricted unreasonably. The parties rely upon 2006 Volume 13 Supreme Court C....
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....he Act and the Rules so as to facilitate an assessee to have an assessment in a transparent and a just manner. The amendments introduced contemplate the assessing officer making over a draft order of assessment and permitting the assessee to raise objections, if any, with regard thereto. In this manner, he submits that, an assessee is made aware of the proposed order of the assessing officer and the assessee is in a position to correct any errors in the order of assessment that may have crept in. Once such a mechanism is used for the purpose of passing a final order of assessment, an appeal against such order would lie in terms of Section 84 of the Act of 2003. An assessee is not required to pay tax in dispute or deposit any tax when the assessing officer serves a provisional order of assessment. He refers to Rule 54 (7) and Rule 57 (3) in support of his contentions. He submits that, there is a rationality in prescribing a cut of date of April 1, 2015. In view of the amendments introduced to the various provisions of the Act and the Rules, and in view of a new mechanism of passing of final order of assessment being introduced by such amendments it stands to reason....
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....inted under sub-section (1) of section 6 to assist the Commissioner as may be prescribed to exercise the power under the section against a provisional assessment or any other assessment, within forty-five days or such further period as may be allowed by the said authority for cause shown to his satisfaction from the receipt of a notice of demand in respect thereof: Provided that where the total amount of tax, interest, late fee or penalty in dispute in an appeal is in excess of rupees twenty lakh, such appeal may lie before an appellate forum as may be constituted by the Commissioner, consisting of one or more Special Commissioner or Additional Commissioner or any person appointed under sub- section (1) of section 6 to assist the Commissioner, and the appellate forum shall act as the appellate authority in disposing of such appeal under this section: Provided further that no appeal for any period submitted on or after the 1st day of April, 2015, shall be entertained by the said authority unless it is satisfied that the applicant has produced the documents relating to proof of payment of - (a) full amount of tax, interest, penalty or late fee, as the case ....
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....& Co. (supra) deals with Tamilnadu Value Added Tax of 2006. It considers the parameters for testing the validity of retrospective operation of fiscal laws. Retrospectivity per se is not the issue in the present writ petition. H.H. Lakshmi Bai & Anr. (supra) is of the view that, a taxing statute has to be strictly construed. There is no equity in taxing provision. Moreover, consideration of a hardship as a result of strict construction is not relevant. Vadilal Lallubhai (supra) deals with transfer of shares prior to liquidation of an incorporated company. M/s. Jit Ram Shiv Kumar & Ors. (supra) deals with principle of estoppel against the Government and a Municipal Committee. It holds that, the plea of estoppel is not available to prevent a Municipality from acting in accordance with law. The ratio laid down therein is not attracted to the facts of the present case. The principles which a Court is required to have regard to while deciding the challenge to the constitutional validity of a taxation law are noted in Rakesh Kohli (supra). It says in paragraph 32 as follows:- "32. While dealing with constitutional validity of a taxation law enacted by the Par....
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....ion, where clause (a) allows payment of the admitted liability which includes tax, interest, penalty or late fee, as the case may be, then the same word "payment" cannot take a different meaning or a contour while regulating clause (b) of the second proviso. The petitioners press into service the meaning of the word "payment", "deposit" and "pre-deposit" as appearing in the dictionary. Black's Law Dictionary defines "Payment" to mean performance of an obligation by the delivery of money or some other valuable thing accepted in partial or full discharge of the obligation. Also the money or other valuable thing so delivered in satisfaction of an obligation. This meaning is contrasted with the meaning of "deposit" which according to the petitioners, relying upon the Black's Law Dictionary means, the act of giving money or other property to another who promises to preserve it or to use it and return it in kind. Pre-deposit means to deposit beforehand or for future use. According to the petitioners, the word "payment" cannot assume a different contour as a deposit or a pre-deposit for the purpose of guiding clause (b) of the second proviso to Section 84(1) of the Act of 2003. ....
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....nt of a tax in the context of clause (a). Viewed from such perspective, there is no violence to the user of the words in the second proviso to Section 84(1) of the Act of 2003. It can be contended that, the words in the second proviso are clear and that, clause (b) does not speak of a deposit or a pre-deposit for a person or the Court to read the word "payment" while regulating clause (b) as a payment of a deposit. This contention assumes that, the Section 84 requires a payment of tax of 15 per cent of the tax in dispute to prefer an appeal. That assumption, with the greatest of respect, is not available in the context. The State has not imposed a tax to prefer an appeal. Learned Additional Advocate General says that, the State does not read Section 84 to be so. According to him, it is a deposit which would abide by the result of the appeal, that is to say that, on the appellant succeeding in the appeal, the amount deposited in terms of the second proviso to Section 84(1) would be refunded to the appellant along with interest. Deposit of 15% tax in dispute in terms of the second proviso to Section 84(1) is not a tax and cannot be turned as an exaction. It is contende....
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.... the order in original does not impose a positive tax incidence on the assessee concerned. In such scenario no deposit is required to be made under the second proviso to Section 84(1) of the Act of 2003. This point is, therefore, disposed of by placing on record such contention on behalf of the State. An assessee applying for refund and such claim for refund having been reduced, an assessee preferring an appeal against such reduction is not required to deposit 15% of the tax in dispute in terms of the second proviso to Section 84(1) of the Act of 2003. This recording cannot be construed to mean that, when there is a demand for tax in the order of assessment, the assessee will be permitted not to deposit the requisite 15% on the ground that, it had claimed refund and the order of assessment is one of demand for tax. Benara Valves Limited & Ors. (supra) concerns undue hardship of an assessee. It takes notes of the principles of safeguarding the interest of revenue also. It explains the expression of undue hardship and the safeguard of interest of revenue as used in Section 35F of the Central Excise Act, 1944. It is of the view that, undue hardship is caused when ....
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....ould not arise. Similarly I.T.C. Ltd. (supra) concerns a pre-deposit under the Customs Act, 1962. Ceat Ltd. (supra) concerns Section 35F of the Central Excise Act, 1944. It sets aside a direction for deposit and replaces the same with a liberty to furnish a bond. Bongaigaon Refinery (supra) concerns exercise of discretion under Section 35F of the Central Excise and Salt Act, 1944. Priyanka Overseas Ltd. (supra) is of the view that, the department cannot take advantage of its own wrong. Shyam Sel and Power Ltd. (supra) concerns a direction issued by the Customs Excise and Service Tax Appellate Tribunal for deposit of a sum as a condition for hearing the appeals. It deals with Section 35F of the Central Excise Act, 1944. It is of the view that, pre- deposit is to be waived in case of extreme hardship. It recognizes that, just as a financial inability to make pre-deposit can lead to hardship, payment of an amount which is not payable, under compulsion, also leads to hardship. When a strong prima facie case is made out and where an assessee has an arguable case, pre- deposit should be waived. Manoranjan Chakraborty & Ors. (supra) deals with the challenge to proviso to Section 20(....
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....of 15% in terms of the second proviso with effect from April 1, 2015 is arbitrary. They are not assailing the modified and a more beneficial and transparent method of adjudication. They accept the same. They, however, contend that, so far as the appeal is concerned, they should be guided by the provisions applicable prior to the amendments introduced to the second proviso on Section 84(1). The petitioners seek to have, by such contention best of both worlds. They seek to take the advantage of the amendments being introduced to the various provisions of the Act of 2003 permitting a more transparent and a beneficial method of assessment so far as an assessment is concerned, and on the other hand, not accept the appeal provision which is founded upon the amendments introduced to the other provisions of the Act of 2003 and the Rules framed thereunder. The contentions of the petitioners, if accepted, would mean accepting a process of adjudication which stands altered from April 1, 2015 and subject the final order passed after applying such modified process of adjudication, to an appeal which remain....
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....anchi Bench dealing with D.V.C. Bukaru Co-operative Stores Ltd. (supra) considers requirement of deposit to prefer an appeal. It notes Manoranjan Chakraborty & Ors. (supra). It holds that, such a requirement is not exorbitant and does not impose any onerous or unreasonable conditions on the right of appeal. Jindal Stainless Ltd. (supra) concerns Section 77(4) of the Orissa Value Added Tax which provides that, no appeal against an order shall be entertained by the appellate authority unless it is accompanied by statutory proof of payment of admitted tax in full or 20% tax or interest or both in dispute. It is of the view that, requirement of deposit of 20% of the tax or interest or both in dispute as a pre- condition in entertaining an appeal does not make the right of appeal illusory and that, such a condition is within the legislative power of the State legislature. It cannot be held to be unreasonable and violative of the Constitution of India. In Prakrith Builders Pvt. Ltd. (supra) the Karnataka High Court considers the validity of Section 22(5) of the Karnataka Sales Tax Act, 1957 which requires a deposit of 50% for the purpose of preferring an appeal. It is of the view t....
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....erwent few amendments. In the present case, relevant amendments to the rules are Rule 54(7) and Rule 57(3). The amendments to Sections 43 and 46 and to Rules 54(7) and 57(3) provide that, in the case of audit assessment under Section 43 read with Rule 54(7) and in case of regular assessment under Section 46 read with proviso to rule 57(3) an assessee would be supplied with the gist of the findings for raising objections to such proposed findings contained in the draft assessment order. The final assessment order would be made only after consideration of the draft assessment order and the objections raised with regard thereto. The petitioners have availed of such a procedure for the purpose of having the assessment done. Once the petitioners have accepted such procedure for assessment, they cannot be allowed to contend that, with effect from April 1, 2015 their right of appeal stands altered to their prejudice. The right of appeal altered with effect from April1, 2015 is in consonance with the amendments introduced to the assessment procedure. The petitioners have accepted the assessment procedure. They are, therefore, bound to accept the appeal provisi....