AI Drafter 
TaxTMI 
TaxTMI 
2018 (4) TMI 146
X X X X Extracts X X X X
X X X X Extracts X X X X
....g electricity. 2. The petitioner is involved in the generation of electricity through its power plant at Bawal in Haryana. Natural gas is used for generation of electricity. The natural gas is supplied by M/s Bharat Petroleum Corporation Limited and M/s Indian Oil Corporation Limited from Gujarat. 3. The petitioner, before the Goods & Service Tax, 2017 (for short, 'GST') came into force, was registered under the Haryana Value Added Tax Act, 2003 (for short, 'the HVAT Act') and under the Central Sales Tax Act, 1956 (for short, 'the CST Act'). The registration under the CST Act continues to date. The certificate admittedly includes natural gas. The certificate is in Form B which in so far as it is relevant reads :- Form B Certificate of Registration [See rule 5 (1)] TIN No. 06342708008 This is to certify that M/S CAPRO POWER LTD. whose principal place of business within the State of Haryana has been registered as a dealer under sections 7 (1) 7 (2) of the Central Sales Tax Act, 1956. The class (es) of goods specified for the purposes of sub-sections (1) and (3) of section 8 of the said Act is/are as follows and the sales of these goods in the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nder section 7; 3. When is a sale or purchase of goods said to take place in the course of inter-State trade or commerce. 2. (i) "sales tax law" means any law for the time being in force in any State or part thereof which provides for the levy of taxes on the sale or purchase of goods generally or on any specified goods expressly mentioned in that behalf and includes value added tax law, and "general sales tax law" means any law for the time being in force in any State or part thereof which provides for the levy of tax on the sale or purchase of goods generally and includes value added tax law; A sale or purchase of goods shall be deemed to take place in the course of inter-State trade or commerce if the sale or purchase - (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. Explanation 1 - Where goods are delivered to a carrier or other bailee for transmission, the movement of the goods shall, for the purposes of clause (b), be deemed to commence at the time of such delivery and terminate at the time wh....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ither on the application of the dealer to whom it has been granted or, where no such application has been made, after due notice to the dealer, be amended by the authority granting it if he is satisfied that by reason of the registered dealer having changed the name, place or nature of his business or the class or 44classes of goods in which he carries on business or for any other reason the certificate of registration granted to him requires to be amended; or (b) be cancelled by the authority granting it where he is satisfied, after due notice to the dealer to whom it has been granted, that he has ceased to carry on business or has ceased to exist or has failed without sufficient cause, to comply with an order under subsection (3A) or with the provisions of sub-section (3C) or sub- section (3E) or has failed to pay any tax or penalty payable under this Act, or in the case of a dealer registered under sub-section (2) has ceased to be liable to pay tax under the sales tax law of the appropriate State or for any other sufficient reason. 8. Rates of tax on sales in the course of inter- State trade or commerce.- (1) Every dealer, who in the course of inter-St....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provision of sub-section (2), in the State from which the movement of the goods commenced: .......... x x x .............. x x x .............. x x x .... (2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess re-assess, collect and enforce payment of tax, including any interest or penalty, payable by a dealer under this Act as if the tax or interest or penalty payable by such a dealer under this Act is a tax or interest or penalty payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....al Sales Tax (Haryana) Rules, 1957 is as follows : 7 (1) Where a dealer desires the certificates of registration granted to him under these rules to be amended, he shall submit an application for this purpose to the notified authority setting out the specific matters in respect of which he desires such amendment and the reasons therefore, together with the certificate of registration and the copies thereof, if any, granted to him; and such authority may, if satisfied with the reasons given, make such amendments as it thinks necessary, in the certificate of registration and the copies thereof, if any, granted to him. (D) Form C is as follows :- FORM C ORIGINAL THE CENTRAL SALES TAX ((Registration & Turnover) RULES, 1957 FORM 'C' FORM OF DECLARATION [Rule 12 (1)] Name of issuing State Officer of issue Date of issue Name of the purchasing dealer to whom issued alongwith his Registration Certificate No..... Date from which registration is valid Seal of the Issuing Authority Serial No. .............. To * (Seller) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ryana Goods and Service Tax Act, 2017 so far as they are relevant are as follows :- 2. (52) "goods" means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply; 7. (1) For the purposes of this Act, the expression "supply" includes (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business; (c) the activities specified in Schedule I, made or agreed to be made without a consideration; and (d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. 9. (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the Haryana Goods and Services Tax on all intra-State supplies of goods or services or both, exce....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on of electricity. The sale and purchase of natural gas therefore takes place in the course of inter-state trade or commerce. 8. The definition of 'goods' in Section 2 (d) prior to the amendment of 2017 included all material, articles, commodities and all other movable property, excluding news papers, actionable claims, stock, shares and securities. Natural gas therefore was included in the term 'goods'. Under Section 6 every dealer under the CST Act is liable to pay tax on all sales of goods other than electrical energy effected by him in the course of inter-state trade or commerce. Thus the oil companies were liable to pay tax under the CST Act in respect of the sale of natural gas. 9. Under Section 9 sales tax is levied by the Government of India but is to be collected in the State, from which the movement of goods commenced. Under Section 9 (2) the authorities empowered to re-assess, collect and enforce payment of tax under the general sales tax law of the appropriate State are to do so even on behalf of the Government of India with respect to the tax due under the CST Act. 10. As per Section 7 (1) of the CST Act, every dealer who was liable to pay tax under the CS....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... is stipulated in section 8 (4). Sub-section (4) provides that this reduced rate of tax could be availed only on the dealer selling the goods on furnishing a declaration in the prescribed time and in the prescribed manner viz. Form 'C' in the present case. A reading of Section 8 of the CST Act and Rule 12 of the CST (R&T) Rules along with Rule 7 of the CSTH Rules shows that 'C' Form is to be issued by the tax authorities of the State in which the purchaser of goods is based. The 'C' Form would be given to the seller who would in turn furnish the same to the prescribed authority for claiming a lower rate of tax. 14. In the present case, the petitioner purchased natural gas from the Oil Companies from Gujarat. The sales occasioned the movement of natural gas from Gujarat to Haryana. The petitioner is a registered dealer in the State of Haryana. The Haryana authorities had been issuing 'C' Forms to the petitioner which were given to the Oil Companies in Gujarat who produced the same before the Gujarat tax authorities and were assessed at a reduced rate of tax. This continued till the implementation of the Goods & Service Tax. The question is whether the petitioner continu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....otification under Section 9 (2) of the HGST Act, 2017 not having been issued natural gas continues to be covered under the CST Act. 20. After the implementation of the CGST Act and the aforesaid amendment, the petitioner continued to make inter-state purchases of natural gas from the Oil Companies in Gujarat as before. When it applied for the issuance of 'C' Forms, the Sate of Haryana refused the same. The stand taken is that after the implementation of the CGST Act, the petitioner is not entitled to make inter-state purchases of natural gas on the strength of 'C' Forms. 21. Mrs. Talwar contends that the ingredients of Section 8 (1) would be met only if the petitioner is liable to pay sales tax under the HVAT Act and that registration under the HGST Act is not relevant. 22. The submission is not well founded. As Mr. Ankur Saigal, the learned counsel appearing on behalf of the petitioner rightly submitted, the contention proceeds on the erroneous basis that only a dealer registered under the HVAT Act is covered by section 7 (2). The plain language of section 7 (2) does not contain such a limitation. The petitioner is not liable to pay tax under the CST Act but it is liable ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s within the ambit of the words "sales tax law" of the appropriate State in Sections 7 and 8 of the CST Act. The words "sales tax law" is defined in Section 2 (i) to mean any law for the time being in force in any State or part thereof which provides for the levy of taxes on the sale or purchase of goods. The HGST Act does so as is evident from Section 9 thereof which stipulates a tax on all intra-state supply of goods. Section 7 does not specify the state law that levies taxes on the sale or purchase of goods. Hence, any State law that does so including the HGST Act would fall within the ambit of Section 7 of the CST Act. If the HGST Act is not applicable the HVAT Act would be. Thus in either case the ingredients of Section 7 and 8 of the CST Act would be met. 24. The petitioner therefore fulfils all the requirements of Section 7 (2) of the CST Act. It is liable to pay tax in the State of Haryana under the HGST Act. Even though there is no liability under the CST Act, yet it will be a registered dealer under Section 7 (2) of the CST Act. 25. Mrs. Talwar then contended that the petitioner is not engaged in the business of re-selling the natural gas and is, therefore, not enti....