2018 (11) TMI 1622

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.... The petitioner's complaint is that as a selling dealer, the C Forms, which he relied upon, were rejected and the tax burden increased. He complains that the purchasing dealer from Haryana had issued the C Form on 20.08.2017 covering all transactions (i.e. Bill No.13 dated 03.05.2017 and Bill No.18 dated 27.05.2017). It is submitted that the impugned order of 01.08.2018, rejected the transactions covered by the C Form and directed the dealer petitioner to pay an amount of Rs. 22,37,991/-. It is also stated that the subsequent order of 16.08.2018, assessed the turnover for the relevant period without taking into account the C Form and also proceeded to impose a penalty. Besides other grounds, the petitioner urges that the cancellation ....

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....e manner that the Delhi VAT authorities did, cannot be sustained. The court is also of the opinion that the observations in Jain Manufacturing impinge on the power of an authority to resort to retrospective cancellation of C Forms. This is clear from the following finding : "25. In the present case with their being a valid registration of the purchasing dealer on the date of the transaction and the C-Form having been validly issued on the date it was so issued, there could not have been a retrospective cancellation of the C-Form. At the risk of repetition, it must be observed that there is no statutory power that permits cancellation of a C-Form that has been validly issued, much less retrospectively. The only circumstance perha....

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....en such selling dealer cannot later be seen to protest against the cancellation of the C-Form. As observed by the Supreme Court in Commissioner of Sales Tax, Delhi v. Shri Krishna Engg. (supra) the selling dealer in such instance will have to pay for his "recklessness". 27. To answer the problem highlighted by Mr Narayan, the best course of action would be for an authority to cancel the CST registration prospectively and immediately place that information on its website. In such event, there would be no difficulty in the selling dealer being able to verify the validity of the CST registration of the purchasing dealer. However, where the cancellation of the registration and, consequently of the C-Form is sought to be done retrospect....