Madras High Court
Tvl.Moogambigai Paper Company vs )Appellate Deputy Commissioner ... on 28 September, 2018
Author: J.Nisha Banu
Bench: J.Nisha Banu
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BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 28.09.2018
CORAM :
THE HONOURABLE MRS.JUSTICE J.NISHA BANU
W.P(MD)Nos.2113 of 2012 and 13390 of 2011
and
M.P(MD)No.1 of 2012 and 1 of 2011
Tvl.Moogambigai paper company,
Represented by its Partner R.M.Thiyagarajan,
288/2, Gnanagiri Road,
Sivakasi 626123,
Virudhunagar District. ... Petitioner in both WPs
vs.
1)Appellate Deputy Commissioner (CT)(FAC),
C.T. Buildings, Madurai Road,
Virudhunagar. ... R1 in both WPs
2)Commercial Tax Officer-III, (FAC)
C.T. Buildings, Satchiapuram,
Sivakasi,
Virudhunagar District. ... R2 in W.P.2113/12
3)Deputy Commercial Tax Officer-III, (FAC)
C.T. Buildings, Satchiapuram,
Sivakasi,
Virudhunagar District. ... R2 in W.P.13390/1`
W.P.2113/12 is filed under Article 226 of the Constitution of India,
for issuance of a Writ of Certiorarified Mandamus, to call for the records
relating to the Appeal orders passed by the 1st respondent in Appeal No.
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& year CST 37/2007 dated 10.02.2010 received by the petitioner on
19.03.2010 and quash the same and to direct the 1st respondent to pass
orders after affording opportunity to the petitioner for a personal
hearing.
W.P.13390/11 is filed under Article 226 of the Constitution of India,
for issuance of a Writ of Certiorarified Mandamus, to call for the records
relating to the Appeal orders passed by the 1st respondent in Appeal No.
& year CST 50/2004 dated 10.02.2010 received by the petitioner on
19.03.2010 and quash the same and to direct the 1st respondent to pass
orders after affording opportunity to the petitioner for a personal
hearing.
For Petitioner : Mr.A.S.Mujibur Rahman
For Respondents : Mr.D.Muruganandam
Additional Government Pleader
COMMON ORDER
The prayer in these writ petitions is for issuance of a Writ of Certiorarified Mandamus, to call for the records relating to the Appeal orders passed by the 1st respondent in Appeal Nos. & year CST 37/2007 and CST 50/2004 dated 10.02.2010 received by the petitioner on 19.03.2010 and quash the same and to direct the 1st respondent to pass orders after affording opportunity to the petitioner for a personal hearing.
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2.The petitioner is a dealer in paper and board and registered dealer under the Tamil Nadu General Sales Tax Act 1959 and Central Sales Tax Act, 1956 and an assessee on the file of the 2nd respondent. For the assessment years CST No.511356/95-96 and CST No.511356/97-98, the petitioner was finally assessed on a total and taxable turnover of Rs. 90,03,566.00 and Rs.1,04,92,418.00 respectively in the assessment orders of the 2nd respondent dated 03.01.2000 and 29.02.2000 respectively and the 2nd respondent granted exemption under CST Act 56 as per Section 6(2) of the CST Act 56 on the turnover of Rs.90,03,566.00 and Rs. 1,04,92,418.00 respectively towards the transit sales which were covered by ''C'' forms and ''E1'' forms. Subsequently, the 2nd respondent revised the assessment on 30.03.2001 and 31.03.2003 respectively, rejecting the exemption granted under CST Act 1956 for the reason that ''C'' form declarations issued by certain purchasers were not genuine and disallowed the exemption and also levied penalty of Rs.13,50,536/- and Rs.10,67,062/- respectively, against which, the petitioner preferred appeals in Appeal Nos. and year CST 37/2007 and CST 50/2004 respectively, and the same were dismissed by separate orders dated http://www.judis.nic.in 4 10.02.2010 holding that none represented on behalf of the appellant and despite adjournments of the appeals on several times, the authorised representative of the petitioner did not appear for hearing and verification of ''C'' forms and declarations furnished by the petitioner proved to be not genuine, confirmed the orders of the 2nd respondent, against which, the petitioner has filed these writ petitions.
3.Learned counsel for the petitioner would submit that the authorised representative of the petitioner did not attend the hearings and hence the petitioner did not know about the position of the appeals which resulted in dismissal of the appeals based on one side argument of the departmental representative(Commercial Taxes). It is further submitted that the 1st respondent has not followed several orders passed by this Court holding that selling dealer is not liable for the mistake and omissions in ''C'' forms and only the purchasing dealer is liable to be proceeded by the department and therefore, the 2nd respondent has to proceed against the person who issued ''C'' form in the manner known to law. Therefore, he prays to set aside the impugned revised assessment orders.
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4.Learned Additional Government Pleader appearing for the respondents would submit that despite several opportunities, the petitioner did not avail the same to put forth his defence. Considering the submission of the departmental representative that verification of ''C'' forms and declarations submitted by the petitioner for claiming exemption disclosed that it were obtained from undisclosed and unidentified sources, the appeals were taken up for final disposal on merits and in the impugned orders, the appellate authority has elaborately dealt with how ''C'' forms and declarations submitted by the petitioner were not genuine. Therefore, he submitted that the impunged orders are well considered orders and do not call for interference by this Court.
5.Heard both sides and perused the records.
6.Perusal of record shows that though the appeals were listed for hearing on several dates, neither the petitioner nor his authorised representative appeared and even on 04.02.2010, when the appeals were http://www.judis.nic.in 6 listed for final hearing, there was no representation on the petitioner side. Therefore, the appellate authority took the appeals for final disposal on merits. On the other hand, one R.Krishnamurthy, Departmental Representative(CT)(FACT), Virudhunagar, appeared for the respondents and supported the orders of the assessing officer. The departmental representative contended that ''C'' forms submitted by the petitioner were obtained from undisclosed and unidentified sources and verification of ''C'' forms submitted by the petitioner proved that the petitioner had colluded with the purchasing persons and availed wrong exemption by filing declaration. According to the departmental representative, ''C'' declarations filed by the petitioner said to be obtained from the respective dealers were not issued by the respective assessing officer who was the prescribed authority. There is no provision for a dealer to obtain any declaration from any of the assessing officer other than his jurisdiction officer. The pre-revision notice was issued to the petitioner stating the real position of the declaration. However, the petitioner failed to produce any of the documents such as, copy of receipt for the purchase of the above C http://www.judis.nic.in 7 form, counterfoil copy of C form in which the certificate might have been made by the issuing authority and Form 8 Register copy in which the certificate might have been made by the issuing authority. Even the existence of the dealer was also not proved by the petitioner from whom the transactions were said to be made and therefore, the petitioner had failed to prove the transactions as per Section 9(2) of the CST Act 56 read with Section 10 of the TNGST Act 56. The inaction on the part of the petitioner in not taking any steps to find out the purchaser clearly shows the petitioner had colluded with the purchasing persons and claimed by filing declarations which were obtained from undisclosed and unidentified sources. The departmental representative would also contend that CTO had not taken any legal action against the purchasing dealers till date. The assessing authority within his discretionary powers, had certified the supply of the declarations and thereby disallowed the claim of exemption as provided under the CST Act 56. The position of the declaration whether it was printed by the department, where it was allotted and how it was supplied to the particular person are not relevant to the assessment proceedings. Even http://www.judis.nic.in 8 if the declaration was printed by the department and it was obtained by the purchaser in any manner, the exemption could not be allowed on a declaration which was not obtained from the prescribed authority as provided in Section 8(4) of the CST Act 56. All other action is liable under criminal procedure and it would in no way interfere with the disallowing the exemption on the disputed transaction.
7.Perusal of record shows that in the case of exemption under section 6(2), ''C'' form is essential without which the sale will be treated only as inter state sales liable to tax at the rates specified under Section 6(1) of the CST Act and 'C'' forms obtained by the buyers from the prescribed authority alone is a proper declaration and not others. Rule 2(cc) of the CST (R & T) Rules read with section 9(2) and 13(4) of the CST Act defines ''prescribed authority is the authority competent to assess''. Section 8(4)(1)(a) read as 'a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in prescribed form obtained from the prescribed authority' and Rule 10(3)(i) of the CST (Tamil Nadu) Rules reads as ''No http://www.judis.nic.in 9 purchasing dealer shall give any declaration in a form except in a form obtained by him on application from the assessing authority'' and Rule 10(3)(ii) of the CST (Tamil Nadu) Rules read as ''No selling dealer shall accept any declaration except in a form obtained from the purchasing dealer, on application from the prescribed authority in his state.'' In respect of wrong, false or bogus declaration, there is no provision to proceed against the purchasers to recover the tax lost to the Revenue. The revenue can have recourse only under Section 10(a) for having furnished a declaration under sub-section (4) of section 8, which he knows or has reason to be believed, to be false.
8.The above provisions clearly indicate that onus of proving the genuineness of the declaration filed by the petitioner rests with them, which the petitioner failed to do so and even though sufficient materials were furnished to the petitioner and several opportunities were given, the petitioner did not come forward with concrete evidence to discharge the burden of proof that ''C'' forms furnished were genuine. Therefore, considering the arguments of the departmental representative and the records available, the appellate authority dismissed the appeals holding http://www.judis.nic.in 10 that ''C'' forms filed by the petitioner to claim exemption were not issued by the prescribed authority to the purchasers and therefore, the petitioner is not entitled to claim exemption under Section 6(2)(b) of the CST Act 1956, which does not warrant interference by this Court. The decision relied on by the petitioner in W.P(MD)Nos.2807 of 2006 etc batch dated 17.09.2009 is not applicable to the facts of this case, as it was a case of issuance of forged ''C'' forms by the purchasing dealers and the petitioner therein sought to take action against them by impleading them as respondents therein and considering the same, this Court directed the department to take necessary action against the purchasing dealers. But, here is a case, the department on verification of ''C'' form declarations found that the petitioner had colluded with the purchasing persons and claimed by filing declarations which were obtained from undisclosed and unidentified sources.
Accordingly, both the Writ Petitions are dismissed. No costs. Consequently, connected miscellaneous petitions are closed.
Index : Yes / No 28.09.2018
Internet : Yes / No
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To
1)Appellate Deputy Commissioner (CT)(FAC),
C.T. Buildings, Madurai Road,
Virudhunagar.
2)Commercial Tax Officer-III, (FAC)
C.T. Buildings, Satchiapuram,
Sivakasi,
Virudhunagar District.
3)Deputy Commercial Tax Officer-III, (FAC)
C.T. Buildings, Satchiapuram,
Sivakasi,
Virudhunagar District.
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J.NISHA BANU, J
bala
W.P(MD)Nos.2113 of 2012
and 13390 of 2011
28.09.2018
http://www.judis.nic.in