TaxTMI 
TaxTMI 
2018 (8) TMI 70
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....r made on 29.09.2016. 2.0. So far as Special Civil Application No.7844 of 2016 is concerned, the petitioner has also prayed to quash and set aside the impugned notices for payment of tax issued in Form 3 dated 13.04.2016 passed by the respondent no.2 herein. The petitioner has also prayed to quash and set aside the impugned notices for assessment issued in Form 2 dated 13.04.2016 by the respondent no.2. The petitioner has also prayed to quash and set aside the impugned notices for demand dated 13.04.2016 issued by the respondent no.3 to the petitioner. Special Civil Application No.5379 of 2016 3.0. The facts leading to the present Special Civil Application No.5379 of 2016 in nutshell are as under: 3.1. That the petitioner is a proprietorship firm and works a contractor engaged in road construction. That the petitioner is registered under VAT Act. That on 29.09.2006 the petitioner purchased a hydraulic excavator for use in execution for works contract. According to the petitioner, the purchase was duly recorded in the books of accounts. According to the petitioner, hydraulic excavator is a machine mounted on chains and not on rubber tyres. Therefore, according to the petitioner,....
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....o. 27462419 dated 30.03.2012 23.04.2012 1,20,33,756/- Tata - Hitachi Hydraulic excavator model ZX450H with Loading Shovel Invoice No. 27462291 dated 29.02.2012 02.04.2012 1,18,13,130/- Hydraulic Excavator L&T 300D Invoice No. 911402203 dated 30.09.2014 27.11.2014 1,42,88,262/4.2 4.2. That on 06.04.2016, pursuant to instructions received from the Respondent No. 1Joint Commissioner of Tax, the Respondent No. 3Commercial Tax Officer, Amreli conducted a search/survey at the premises of the Petitioner under the provisions of the Gujarat Value Added Tax Act, 2003 and the rules framed thereunder. That on the very same day i.e. on 06.04.2016, a notice in Form401, under Section 67, 70 and 70A of the VAT Act, came to be issued to the Petitioner, seeking an explanation from the Petitioner qua the failure on payment of Entry Tax on the equipment purchased by the Petitioner, in 2011-12 and 2013-14. That on 12.04.2016, the representative of the Petitioner appeared before the Respondent No. 3, and inter alia submitted that the aforesaid equipment not being Motor Vehicles in terms of the Gujarat Tax on Entry of Specified Goods into Local Areas Act, 2001 ("Entry Tax Act") was not amenab....
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.... Tax Act, no order of assessment can be made after the expiry of three years from the last date prescribed for furnishing of return - cum - challan of the particular period. It is submitted that further in view of Rule 6 of the Entry Tax, the return - cum - challan is required to be furnished to the concerned authority within a period of one month and fifteen days immediately succeeding the month for which return - cum - challan is required to be furnished. It is submitted that therefore, the respondents could have initiated the proceedings, if any, demanding Entry Tax from the Petitioner, under the provisions of the Entry Tax Act, latest by dates hereunder specified: Invoice Date Entry Date Period under Rule 6 Completion of 3 years 29.02.2012 02.04.2012 17.05.2012 17.05.2015 30.03.2012 23.04.2012 08.06.2012 08.06.2015 30.09.2014 27.11.2014 11.01.2015 11.01.2018 It is submitted that the impugned proceedings/ demand notices are clearly barred by limitation and therefore, liable to be quashed and set aside on this ground alone. 6.2. It is further submitted by Shri S.N. Soparkar, learned counsel for the petitioner that an assessment or reassessment under the Entry....
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....where the return - cum - challan is not filed by an entity, more particularly as to how the authority can compel an entity to file such return - cum - challan after the expiry of the prescribed period. It is submitted that in absence of such a provision, the petitioner cannot be compelled to file the return - cum - challan at this stage, when the period prescribed under Rule 6 of the Entry Tax Rules has already lapsed. 6.4. It is further submitted by Shri S.N. Soparkar, learned counsel for the petitioner that the assessee under the provisions of section 11(1)(a)(iii) of the Gujarat Value Added Tax Act, 2003, is entitled to claim tax credit equal to the amount of tax paid under the Entry Tax Act. It is submitted that in view thereof, if the provisions of the Entry Tax Act were to be interpreted in a manner wherein the Respondent authorities are empowered to compel the Petitioner to file return - cum - challan under the Entry Tax Act after the expiry of the prescribed period under Rule 6 of the Entry Tax Rules, it would tantamount to depriving the petitioner of the opportunity of claiming such tax credit in respect of the VAT paid during the corresponding period. It is submitted tha....
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....e State. It is submitted that Rule 6 of the Entry Tax Rules requires furnishing of "return - cum - challan" in Form 1 by an importer to the assessing authority within whose jurisdiction the specified goods are brought for consumption, use or sale. It is submitted that even in the prescribed format i.e. Form 1, the description of the "specified goods" imported along with value, rate of tax, etc needs to be filled along with a statement that the tax amount as per such return has been deposited by the importer. It is submitted that even return - cum - challan needs to be filed only if a person believes that he has imported "specified goods" into the State of Gujarat. It is submitted that there is no provision requiring persons to file Nil returns in cases where non-specified goods are imported into the State of Gujarat. 7.2. It is further submitted by Shri Sheth, learned advocate for the petitioner that even there is no provision under the Entry Tax Act for assessment if return is not filed by an importer. It is submitted that there is no provision under the Entry Tax Act empowering the authorities to call upon a person to file return and pay entry tax in a case where such person has....
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....ned advocate for the petitioner that even there is no provision for filing nil return and hence time-barring of assessment cannot be restricted to persons who have filed returns. It is further submitted by Shri Sheth, learned advocate for the petitioner that there is no provision under the Entry Tax Act requiring or allowing filing of Nil return, in a case where a person imports goods which he bona-fidely believes to be non-specified goods. It is submitted that therefore, as such a person who does not file return under the Entry Tax Act, under a bonafide belief that the goods brought into the State by him are not specified goods, then he does not commit breach of any provision under the Entry Tax Act so as to make the time limit of assessment under Section 8(5) of the Entry Tax Act inapplicable to him. 7.6. It is further submitted by Shri Uchit Sheth, learned advocate for the petitioner that the requirement of filing nil return consciously absent in the statute since registered dealer would in any case be filing returns under the Vat Act. It is submitted that in fact the legislature has consciously refrained from requiring filing of Nil returns under the Entry Tax Act. It is submi....
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....ate of Gujarat. It is submitted that thus the time limit of 3 years stipulated under Section 8(5) of the Entry Tax Act would be applicable to the Petitioner and thus the assessment proceedings are time barred by limitation. It is further submitted by Shri Uchit Sheth, learned advocate for the petitioner that even statutory notice for assessment under Section 8 specifically contains the circumstance where person has not filed returns. It is submitted that statutory notice for assessment in Form 2 which is prescribed for the purpose of Section 8 of the Entry Tax Act by Rule 7(2) of the Entry Tax Rules specifically contains a circumstance where person has not filed returns and the officer wants to make assessment. It is submitted that thus, the legislature also believes that assessment of persons who has not filed returns under the Entry Tax Act is required to be made under Section 8 of the Entry Tax Act. It is submitted that in fact in the case of the Petitioner the very notice for assessment in Form 2 was issued to the Petitioner. It is submitted that therefore, in light of such legal provisions and in view of such facts, it is not open for the learned Respondent authorities to cont....
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....tted by Shri Sheth, learned advocate for the petitioner that even otherwise impugned levy of entry tax at the rate of 15% under the Entry Tax Act by treating excavators as specified goods is bad in law and, contrary to the scheme and object and purpose of Entry Tax Act. It is submitted that excavators used in execution of works contract were classifiable as "Earthmoving Equipment" under Entry 98A of the Gujarat Sales Tax Act, 1969 for which the stipulated rate of tax was 8%. It is submitted that after introduction of the Vat Act w.e.f. 1.4.2006 the Excavators used in execution of works contract are covered under Entry 35 of the notification issued under Section 5(2) of the Vat Act at least till the entry was amended on 15.2.2010 and the stipulated rate of tax for Entry 35 was 4% during the year in question i.e. 2006-07. It is submitted that aforesaid has been held by this Court in the case of State of Gujarat v/s Yantraman Automac Pvt. Ltd reported in 93 VST 423 (Guj). 7.10. It is further submitted by Shri Sheth, learned advocate for the petitioner that imposition of entry tax at the rate of 15% on excavators used in execution of works contracts by treating them to be "motor vehic....
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....equence after filing return. It is submitted that if the return is not filed, Section 8 would not be applicable. 8.2. It is further submitted that Entry Tax Officer would not get idea about entry of goods in the State except on the basis of return filed. It is submitted that in the case under consideration also on the basis of information, search/ survey was made and information regarding entry of vehicles was found out. It is submitted that therefore, irrespective of the fact that whether the concerned importer who brings the goods within the State of Gujarat bona fide believes or not whether the goods imported are "specified goods" or not he has to file return as required under Section 8 of the Entry Tax Act. 8.3. It is submitted that on considering Section 3 and Section 10 of the Act, the liability of entry tax arise at the time of entry of the goods and it is the duty of every person who brings such goods into local area to pay tax. It is submitted that accordingly officers are entitled to issue demand notice. It is submitted that for issue of such demand notice, no time limit is specified in the Act. In support of his above submission, Shri Vora, learned AGP has heavily reli....
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....2016 preferred by the M/s. M.H. Khanusiya is concerned, the petitioner has prayed for an appropriate writ, direction and order quashing and setting aside the impugned notice dated 20.02.2016 by which, the petitioner is called upon to pay entry tax under the provisions of Entry Tax Act. The petitioner also prayed to quash and set aside the assessment order dated 13.06.2016. 10.1. So far as Special Civil Application No. 7844 of 2016 preferred by the petitioner Ultratech Cement Limited, the petitioner has challenged the impugned demand notice dated 13.04.2016, by which, the petitioner is called upon to pay entry tax with interest and penalty on three purchases of Hydraulic Excavator. 11. The impugned notices / orders of assessment (in Special Civil Application No. 5379 of 2016) are challenged by the respective petitioners on the ground stated herein above and mainly on the ground that the impugned notices are barred by limitation provided under Section 8(5) of the Entry Tax Act as well as before the order of assessment is passed, such a demand cum notice directing the petitioner to pay entry tax is not permissible and is bad in law and also on the ground that on the goods so brough....
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....)If the Assessing Authority is satisfied that the return furnished by a person liable to pay tax under this Act is correct and complete, he shall assess the amount of tax due from the person on the basis of such return (3)If the Assessing Authority is not satisfied that the return furnished by a person liable to pay tax under this Act is correct and complete, and the Assessing Authority thinks it necessary to require the presence of the person or the production of further evidence, the Assessing Authority shall serve on the person in prescribed manner a notice' requiring him on a date and at a place specified therein, either to attend and produce or cause to be produced such evidence as is specified in the notice.. On the date specified in the notice, or as soon as may be thereafter, the Assessing Authority shall, after considering all the evidence which may be produced, assess the amount of tax due from the person. (4)If a person fails to comply With the requirements of any notice issued under sub-section (3), the Assessing Authority shall determine the purchase value Of tile specified goods under the proviso to clause (I) of section 2 and assess to the best of his judgement, ....
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....hat purpose all the Assessing Authorities shall have and exercise all the powers of a Collector under the provisions of the Bombay Land Revenue Code, 1879. Section 10A : Special mode of recovery (1) Notwithstanding contained anything contained in any law or contract to the contrary, the Assessing Authority may at any time or from time to time, by notice in writing, a copy of which shall be forwarded to the importer at his last known address, require: (a) any person from whom any amount of monies is due or may become due, to an importer on whom notice has been served under sub-section(1) or (b). any person who holds or may subsequently hold monies fro or an account of such importer to pay to the Assessing Authority, either forthwith upon the monies becoming due or being held or within the time specified in the notice (but not before the monies becomes due or is held as aforesaid) so much of the monies as in sufficient to pay the amount due by the importer in respect of the arrears of tax or penalty under this Act, or the whole of the money when it is equal to or less then the amount. Section 11:Refund of tax The Assessing Authority shall, on an application made in such f....
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....n, Finance Department No. (GHN20) GEA2008/( S3) (3) TH, Dated THE 1st April, 2008, brought into local area, an electronic operator referred to in clause (d) of rule 2 only shall be liable to pay tax. Such electronic operator shall, within two days of entry of specified goods into local area, pay into a Government Treasury, the tax due and payable under the Act: Rule 4.Method of payment of tax and penalty. (1) Every payment of tax and penalty shall be accompanied by a return - cum - chalan in Form I obtained from a Government Treasury or the Assessing Authority appointed under section 5 of the Act. (2) The payment made into a Government Treasury shall be accompanied by a return - cum - chalan, in quadruplicate. The copies marked "Original" and "Duplicate" shall be returned to the importer duly receipted, of which the copy marked "Duplicate" shall be submitted by the importer to the Assessing Authority in accordance with the provisions of this rule. Rule 5. Reduction in tax liability. The amount of tax shall be reduced under sub-sections (1) and (2) of section 4 of the Act, subject to the following conditions, namely: (I)The importer shall produce before the Assessing Aut....
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.... (a) Who is not a registered dealer shall be assessed within three days of entry of specified goods into local area, (b) Who is a registered dealer shall be assessed within a period of three months immediately succeeding the month for which return - cum - chalan is required to be furnished. (2)The notice referred to in sub-section (3) of section 8 shall be in Form 2. (3)Where the tax could not be assessed as per sub-rule (1), the assessment shall be made by the Assessing Authority in whose jurisdiction the specified goods are found or detected as having been consumed, used or sold. (4)The amount of tax assessed, as per subrule (3) shall be recovered in cash from the importer and a receipt to that effect shall be issued. Rule 8. Notice for payment of tax or penalty. A notice under section 10 for payment of tax or penalty shall be in Form 3. 11.2 Return cum challan is required to be furnished in Form 1, as under: Form 1 (See rules 4 and 6) Return - cum - chalan / Revised return - cum - chalan Name and address of importer : PAN No._______________ _______________________________________________________________ Registration no. under the Gujarat Value Added Tax Act,....
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....M/s --------------------------------------------------------------------------------------------------------------------------------------- WHEREAS desire to satisfy myself that the returns - cum - chalan furnished by you in respect of the period from to are correct and complete. AND WHEREAS having effected an entry of specified goods into local area' during the period from to in respect of which you are liable to pay tax under the Gujarat Tax on Entry of Specified goods into Local Areas Act, 2001 you have not furnished by the prescribed date return - cum - chalan in respect of the said period. You are hereby directed to attend at (place) at (time) on date and produce or cause to be produced any evidence on which you rely in support in the said returns-cum-chalan and at the same time produce or cause to be produced the following documents and account and furnish or cause to be furnished the following information. 1 . 2. 3. You are also directed to show cause as to why penalty under sub-section (1) of section 17 of the said Act in respect of the period from to should not be imposed upon you. Place ....
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....Rs_______________ You are here by directed to pay the outstanding dues of Rs._______________ Rupees (in word) in to the Government Treasury within days from the service of the notice failing which the same will be recovered as an arrear of Land Revenue. Date: Signatures Place: &n....
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.... two days of entry of specified goods into local area and if such importer is registered dealer in that case, within a period of 21 days immediately succeeding the month for which return is required to be furnished. That as per the scheme of the Act and Rules after return - cum - challan is filed, thereafter the question with respect to assessment will arise as provided under Section 8. As per sub-section( 5) of Section 8, no order of assessment under sub-section (3) or (4) shall be made after the expiry of three years from the last date prescribed for furnishing of returns of the particular period. It further provides that if for any reason, such order is not made within the period aforesaid, then the return so furnished shall be deemed to have been accepted as correct and complete for assessing the tax due from such person. As per the scheme of the Act and as per Section 10, a person liable to pay the tax, shall before furnishing return as required by sub-section( 1) of Section 7, first pay into the Government treasury in the prescribed manner, the whole of the amount of tax due from him according to such return. As observed herein above and as provided under Rule 6 of the Rules....
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....y, the submission on behalf of the petitioner that unless and until assessment order is passed and the amount of tax is determined there is no question of making payment of tax is concerned, the aforesaid submission is also contrary to the scheme of the Act and Rules. 13.0. Now, so far as submission on behalf of the petitioner that under the provisions of Gujarat Value Added Tax Act, the assessee is entitled to claim tax credit equal to the amount of tax under the Entry Tax Act and therefore, the submission on behalf of the petitioner that if the provisions of Entry Tax Act were to be interpreted in a manner wherein the respondent authorities are empowered to compel the petitioner to file return cum challan under the Entry Tax Act after the expiry of prescribed period under Rule 6 of Entry Tax Rules it would be tantamount to depriving the petitioner of the opportunity of claiming such tax credit in respect of the VAT paid during the corresponding period is concerned, still the petitioner can file return - cum - challan and on payment of tax can still get credit under the provisions of Gujarat Value Added Tax Act, if at all the same is allowable. Similarly, while filing return - cu....