TaxTMI 
TaxTMI 
2020 (3) TMI 996
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.... 3. By these petitions under Article 226 of the Constitution of India, the petitioners have prayed for the following reliefs: "A. This Hon'ble Court may be pleased to issue a writ striking down and declaring condition no.2 of remission order dated 5.9.2017 (annexed at Annexure A) issued by State Government of Gujarat as being beyond the competence of the State Government, arbitrary, discriminatory and violating Article 14 of the Constitution of India; B. Without prejudice to the above and in the alternative this Hon'ble Court may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other appropriate writ or order to the State Government to act upon the representation made by IOCL and give positive clarification to the effect that availing benefit of remission on local sales under order dated 5.9.2017 will not lead to liability of tax at fully rate on inter- State sales made against C form declarations; C. This Hon'ble Court may be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other appropriate writ or order directing either the State Government or IOCL to grant refund to the Petiti....
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....ed under the GST regime, but LNG continued to be taxed under the Act 2003 at the rate of 15%. 6.6. The petitioners were therefore, unable to take input tax credit on the tax paid to the IOCL on purchase of LNG under the Act 2003 against the output tax liability of the petitioners under the Act 2017. 6.7. Upon consideration of the representation of the petitioners, the respondent No.1-State issued remission order dated 05.09.2017 in exercise of powers under Section 41 of the Act 2003. As per the said remission order, the tax on sales of natural gas to manufacturers was remitted at the rate of 9% provided such natural gas was used in manufacture of goods covered under the GST regime other than for use in generation of electricity or manufacture of fertilizers. 6.8. The petitioners were therefore, entitled for the benefit under the remission order dated 05.09.2017 on certain terms and conditions, the first condition was that the selling dealer was required to charge and collect tax only at the rate of 6% on sales of natural gas. 6.9. According to the petitioners, the Condition No.2 of the said remission order prescribed that the selling dealer shall charge and collect full....
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....es where C-Form is not furnished, the leviable tax would be the actual payable tax and in such sales, no remission would be permitted. Therefore, in view of said communication dated 31.08.2018 made by the Joint Secretary (Tax), Finance Department, Gandhinagar. The whole controversy is resolved and the grievance would not further survive. However if at all there is any confusion or miscommunication on the part of IOCL, the petitioner is required to seek clarification with IOCL. The copy of communication dated 31.08.2018 is annexed herewith and marked as Annexure R I." 7.2. Referring to the aforesaid averments, it was submitted that now the state has clarified that remission order does not overreach the Central Sales Tax Act, 1956 or Section 8 of the said Act and if Form 'C' for sale made in the inter-State are furnished, then such sales would be governed by Central Tax Act, 1956. 7.3. Thereafter, the learned senior advocate invited attention of the Court to the Affidavit filed on behalf of the petitioners to point out that the respondent No.3-IOCL has started charging tax at the rate of 6% on sales of LNG w.e.f. August, 2019 in terms of the remission order dat....
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....collected towards tax in the absence of C form declarations is required to be refunded if the C form declarations are furnished; however, such refund can be granted to the seller - Reliance Industries Limited and not to the petitioners. It was submitted that the transactions in question being interstate transactions, the Commercial Tax Department of Rajasthan was required to issue C forms to the petitioners, which were then required to be forwarded to Reliance Industries Limited, but as the Rajasthan Commercial Tax Department refused to grant C forms to the petitioners, they were liable to pay tax @ 20 % which was deposited with the Gujarat Commercial Tax Department. It was submitted that since the assessment proceedings qua Reliance Industries Limited are still pending for the assessment years in question, the respondent authorities are still to process the application for grant of refund. It was further submitted that the refund shall be paid to Reliance Industries Limited which in turn shall forward the amount to the petitioners. However, the respondent authorities would not be in a position to directly grant refund to the petitioners as it is Reliance Industries Limite....
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....ment. As held by the Supreme Court in State of Madhya Pradesh v. Vyankatlal (supra), only the persons on whom lay the ultimate burden to pay the amount would be entitled to get a refund of the same. The petitioners having borne the ultimate burden in this case, it is only they who would be entitled to refund of the same. 16. Besides the Rajasthan High Court in the petitioners' own case has held that the authorities at Rajasthan were liable to issue 'C' forms in respect of high speed diesel procured for mining purpose through interstate trade. The court has further held that in the event of the petitioners having had to pay any amount on account of the respondents' wrongful refusal to issue 'C' forms, the petitioners shall be entitled to refund and/or adjustment from the concerned authorities who had collected excess tax. The court further directed the concerned authorities to process such claim within twelve weeks of the same being made by the petitioners in writing and the petitioners furnishing the requisite documents/forms. 17. In the present case, in the absence of 'C' forms having been issued by the Rajasthan authorities, the respondent authorities have colle....
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....ment for the period in question, which may take years together and in the meanwhile the petitioners would be deprived of such amount. Moreover, it may be that while processing the refund claim during the course of Reliance Industries Limited's assessment, the respondents may even adjust the refund amount against its dues. Thus, the stand of the respondents that Reliance Industries Limited should file the refund claim and then pay the amount so refunded to the petitioners is neither legally tenable nor is it practically workable. 19. In the opinion of this court, in the light of the clear directions issued by the Rajasthan High Court in the judgment and order referred to hereinabove, which the respondent authorities are bound to comply with, upon the petitioners making applications for refund along with the requisite documents, the respondents were duty bound to process such claim within a period of twelve weeks from the date of such application. The stand adopted by the respondents that the refund can be made to only to Reliance Industries Limited flies in the face of the order passed by the Rajasthan High Court as well as the above-referred decisions on which reliance....