Madhya Pradesh High Court
Devendra Trading Company vs The State Of Madhya Pradesh on 10 January, 2013
Author: M.A. Siddiqui
Bench: M.A. Siddiqui
1
HIGH COURT OF MADAHYA PRADESH : AT JABALPUR
W.P.No.1230/2008
Devendra Trading Company
Vs.
State of M.P. and others.
DB: Hon'ble Mr.Justice Krishn Kumar Lahoti &
Hon'ble Mr. Justice M.A. Siddiqui
____________________________________________
Shri Sanjay Mishra, Advocate for petitioner.
Shri Jaideep Singh, Deputy Govt. Adv.for respondents.
____________________________________________
ORDER
(Passed On 10.01.2013) AS PER : KRISHN KUMAR LAHOTI,J.
Petitioner has sought following reliefs :
"(i) Issue a writ in the nature of mandamus directing the Respondents to treat the sale in question as inter-state sale;
(ii) To declare that levy, assessment and collection of tax under the State Act is unauthorized, without jurisdiction and the same falls within the purview of Central Sales Tax Act, 1956;
(iii) To direct the Respondents to refund the excess amount of tax collected from the Petitioner under the guise of Value Added Tax and to accept C-Forms submitted by Petitioner;
(iv) Any other relief/reliefs, order/orders which this Hon'ble Court deems fit on the facts and circumstances of the case be also granted;
(v) Cost of petition."2
2. This petition was entertained by this Court because the matter was sub-judice before the Apex Court in Civil Appeal No. 2222 of 2012 along with other matters in M/s Zunaid Enterprises & Ors. vs. State of M.P.& Ors. Now the case of M/s Zunaid Enterprises has been decided by the Apex Court by an Order dated 22nd of February, 2012 reported in (2012) 4 SCC 211. The Apex Court has directed thus :-
"7. At the outset, we intend to note that in these type of cases, the High Court ought not to have entertained the writ petitions filed under Article 226 of the Constitution. We say so for the reason,that, whether a sale originating in a State is an inter-state sale or not is essentially a question of fact to be determined by the authorities under the Act, since it involves the application of the provisions of Sections 3, 5, 6 and 9(1) of the Act to the facts established and hence, it will be a mixed question of law and fact. The facts are requireed to be brought to the notice of the Assessing Authority by the appellants and it is for the assessing authority to come to a conclusion, based on those facts whether a particular transaction is intra-State sales which is exigible to the taxes under the VAT Act or inter-State sales, as envisaged under Section 3 of the Act read with Section 6 of the charging provisions therein. It is after such adjudication, the matter can travel from one stage to the other as provided under the Act.
8. In the instant case, as we have already stated,the relevant facts were not before the Court nor the finding of the assessing authority to decide whether the transactions in question are intra-State sales or inter-State which are exigible to taxes under the VAT Act or taxes under the provisions of the Central Sales Tax Act.3
9. Merely based on certain clauses in the agreement, in our opinion, the High Court ought not to have decided and declared that the transactions in question would be purely and simply intra-State sales and not inter-State sales. In our view, whenever a question arises as to whether a sale is inter-
State sale or not, it has to be answered with reference to Section 3 and Section
3 alone. See Constitution Bench judgment in Tata Iron and Steel Co. Limited v. S.R. Sarkar (1960) 11 STC 655.
10. Similarly, when the question arises, in which State is the tax leviable, one must look to and apply the test in Section 9(1); no other provision is relevant on this question (See Bharat Heavy Electricals Ltd. v. Union of India (1996) 4 SCC 230. In that view of the matter, we cannot sustain the orders passed by the High Court.
11. In view of the above, we set aside the orders passed by the High Court and direct the appellants assessees in these cases to file their monthly/annual returns before the assessing authority within a month's time from today, if not already filed. We also direct the assessing authority to adjudicate upon the returns so filed in accordance with law after affording opportunity of hearing to the appellants assessees within two months' time from the date of filing of the returns by the assessees, uninfluenced by the observations made by the High Court. Till such proceedings are completed, the assessing authority(ies) are restrained from issuing further demand notices to the appellants assesses for recovery of taxes either under the VAT Act or under the Central Sales Tax Act. We also make it clear that the amounts deposited by the appellants assesses, during the pendency of the writ petitions before the High Court or during the 4 pendency of the Special Leave Petitions before this Court, shall not be demanded to be refunded to them. "
3. After the order passed by the Apex Court, a Division Bench of this Court in Writ Petition No. 254/12 (M/s Bharat Bidi Workers' Pvt. Ltd.vs. State of M.P.) on 9.4.12 decided the matter and in the light of judgment of Apex Court in M/s Zunaid Enterprises (supra) and others, remanded the matter with certain directions. For ready reference, we quote the order passed in Bharat Bidi Workers' Pvt. Ltd. (supra) which reads as under :-
" The petitioner has filed this petition being aggrieved by the levy of State Sales Tax on auction sale of Tendu leaves by the respondent Federation on the ground that the transaction is an intra State sale and, therefore, cannot be subjected to tax under the State Act in view of the provisions of Section 3 of the Central Sales Tax Act, 1956 (hereinafter referred to as the "Act").
It is, however, fairly stated by the learned counsel for the petitioner that similar and identical issues decided by this Court, traveled to the Supreme Court in the case of M/s Zunaid Enterprises & Others vs. State of M.P. and others, Civil Appeal No. 2222 of 2012 decided on 22.02.2012, wherein it has held that the High Court ought not to have entertained the Writ Petition under Article 226 of the Constitution of India as the question as to whether a transaction amounts to intra state sale or inter state sale has to be decided on the basis of the facts obtaining in each case in accordance with the provisions of Section 3 of the Act and, thereafter directed the appellant therein to file their monthly/annual returns before the assessing authority who in turn have been directed to adjudicate upon the returns so 5 filed in accordance with law after affording opportunity of hearing.
The learned counsel for the parties jointly submit that the present petition be also disposed of with liberty to the petitioner in similar terms.
In view of the aforesaid statement of the learned counsel for the parties and in view of the decision of the Supreme Court in the case of M/s Zunaid Enterprises & Others (supra), the petition filed by the petitioner is disposed of with liberty to the petitioner to file his return before the concerned authority with further liberty to raise all issues regarding intra state sale and inter state sale, as the case may be, before the said authority who would thereafter decide the matter on the basis of the facts and law as obtaining in each case in accordance with the procedure prescribed by law.
With the aforesaid observation and liberty the petition, filed by the petitioner, stands disposed of."
4. As the controversy is identical, we dispose of this matter in the light of judgment by Apex Court in M/s Zunaid Enterprises & Ors. vs. State of M.P.& Ors. (supra) and by Division Bench in Bharat Bidi Workers' Pvt. Ltd.vs. State of M.P.(supra). The matter is remanded back to the Assessing Officer with the same directions as are contained in M/s Zunaid Enterprises & Ors. vs. State of M.P.& Ors. (supra) . The Assessing Officer shall decide the matter finally after extending an opportunity to the petitioner to file his return, if not already filed, and the question whether the sale in question is inter-State sale or intra-State sale would be decided by the Assessing Officer after considering the material produced before it.
65. With the aforesaid directions, this petition is finally disposed of with no orders as to cost.
(Krishn Kumar Lahoti) (M.A.Siddiqui)
Judge. Judge.
Jk.