Allowed

Tvl.Suba Valli Vilas v. The Appellate Deputy

Madras HC20 Nov 2019WP/1340/2015

Case brief

AI extract

What is this about?

The High Court of Madras allowed a writ petition filed by a jeweller challenging a commercial tax assessment order. The taxpayer set off purchase tax liability against Input Tax Credit in monthly returns. The court followed a prior precedent holding this methodology satisfies payment requirements under Section 12 of the TN VAT Act, 2006, and set aside the impugned order. No costs.

What did the court decide?

The impugned assessment order passed on 01.08.2014 was set aside and connected miscellaneous petitions were closed.

Tvl.Suba Valli Vilas Vs The Appellate Deputy — Service and Employment | Madras HC (2019)

¶1

IN THE HIGH COURT OF JUDICATURE AT MADRAS

¶2

DATED: 20.11.2019

¶3

CORAM

¶4

THE HONOURABLE DR. JUSTICE ANITA SUMANTH

¶5

W.P.No.1340 of 2015 MP.No.1 & 2 of 2015

¶6

Tvl.Suba Valli Vilas Represented by its Partner Thiru S.Ganesan ...Petitioner --Vs-1.The Appellate Deputy Commissioner of Commercial Taxes, 1 Commercial Taxes Buildings, Sub Jail Road, Manjakuppam, Cuddalore-607 001 2.The Assistant Commissioner (CT), Cuddalore Town Assessment Circle 1 Commercial Taxes Buildings, Sub Jail Road, Manjakuppam, Cuddalore-607 001 ... Respondent

¶7

Prayer: Writ Petition filed under Article 226 of the Constitution of India, to issue a Writ or order of direction or any other Writ in the nature Writ of Certiorari, calling for the records in respect of the impugned Appeal No. & Year 71/2013 VAT dated 01.08.2014 of the first respondent and quash the same.

¶8

For Petitioner : Mr.Adithya Reddy

¶9

For Respondents: Mr.M.Hariharan

¶10

Government Advocate

¶11

O R D E R

¶12

The petitioner is a jeweller engaged in the manufacture and trading of jewellery. For the period 2009-10, an order of assessment was passed in terms of the Tamil Nadu Value Added Tax Act, 2006 (in short 'Act') on the ground that purchase tax had not been paid in terms of Section 12 of the Act. The petitioner responded to the notice of the Assessing Officer stating that available Input Tax Credit (ITC) had been set off as against the purchase tax liability and this methodology accomplishes remittance of purchase tax liability in full.

¶13

https://hcservices.ecourts.gov.in/hcservices/

¶14

However, the Assessing Officer was of the view that the provisions of Section 12 of the Act require the payment of purchase tax separately and without reference to available credit of ITC. He thus proceeded to confirm the re-asessement proposals bringing to tax the entire purchases effected.

¶15

The petitioner challenged the aforesaid order of assessment before the Appellate Deputy Commissioner, who, while confirming the assessment, levied interest under Section 42(3) of the Act and deleted penalty levied under Section 27(3). It is as against the aforesaid order in first appeal that the petitioner has filed the present writ petition.

¶16

Since this Court both in the Madras as well as Madurai Bench has entertained writ petitions in relation to this very issue, this writ petition is held to be maintainable.

¶17

As far as the methodology adopted by the petitioner for payment of purchase tax is concerned, both learned counsel concur on the position that this very issue has been considered and decided by me in a batch of writ petitions in the case of Bhima Jewellery Vs. The Commercial Tax Officer in W.P.(MD) Nos.9853, 8061 to 8067 of 2010 and 13683 to 13687 of 2015 order dated 22.07.2019. The operative portion of the aforesaid order is as follows:

¶18

Coming to the first issue in regard to purchase tax, the argument advanced by the respondent in the counter to WP(MD)No.9853 of 2010 at para-4 of the counter is extracted below:

¶19

'4.It is submitted that the Petitioner has mentioned the purchase tax under section 12(2) but in no where pointed out that the purchase tax has been paid in the month of purchase in the Form I submitted by the petitioner. For example for month of April 2007 the tax liability is Rs.1754725-00 under section 19(1). Eligible credit under section 19(1) is Rs.2065923-00. The balance amount of Rs.688802-00 was only paid through cheque on 16-5-2007. The liability of Rs.34,772-00 under section 12(2) was not paid in the return filed for the month of April 2007.'

¶20

I am of the considered view that the assessing authority has not appreciated the methodology followed in the proper perspective. What the petitioner has done is, as apparent from the tabulation and reply extracted above, to remit the purchase tax by taking credit in respect thereof against the credit available in the immediately preceding month. Thus, at the end of the period in question, the liability to purchase tax is taken to be remitted in full by set-off of such

¶21

https://hcservices.ecourts.gov.in/hcservices/

¶22

liability against credit admittedly available in the monthly returns. This methodology has found acceptance and approval by the Commissioner of Commercial Taxes, Chennai, in proceedings dated 29.11.2007. At paragraphs No.3 and 4, the Commissioner states thus:

¶23

*3/ nfs;tp ?? vf;!!; fphpol; ,Uf;Fk;nghJ Section12y; thp brYj;jp cs;spl;L thp tut[ vLj;Jf;bfhs;syhkh my;yJ thp brYj;jhkny fHpj;Jf; bfhs;syhkh>

¶24

bjspt[iu ?? kpFjp cs;spl;L thp tut[ ,Uf;Fk;nghJ thp brYj;jhkny fHpj;Jf; bfhs;syhk;.

¶25

4/ nfs;tp ??Section-12-d;go xt;bthU khjj;jpw;Fk; jdpahf thpfl;l ntz;Lkh my;yJ Kjy; khjj;jpy; cs;s vf;!!; bjhifapy; fHpj;Jf;bfhs;syhkh>

¶26

bjspt[iu: ?? xt;bthU khjKk; jdpahf thpfl;l ntz;Lk; kpFjp bjhif ,Ug;gpd; fHpj;Jf;bfhs;syhk;/*

¶27

In the light of the aforesaid, I find no infirmity with the methodology adopted by the petitioner. Clearly, the petitioner has remitted tax on purchases and this fact is not denied. What is disputed is only the methodology of set-off against the monthly returns which, when approved by the Commissioner in proceedings dated 29.11.2007 ought not to have been rejected by the assessing authority. This issue is held in favour of the petitioners.

¶28

The rationale of the above order is applicable to the present case as well. This writ petition is thus allowed and the impugned order, set aside. Consequently, connected miscellaneous petitions are closed. No costs.

¶29

Sd/-

¶30

Assistant Registrar(CS-VI)

¶31

//True copy//

¶32

Sub Assistant Registrar ska To

¶33

1.The Appellate Deputy Commissioner of

¶34

Commercial Taxes,

¶35

1 Commercial Taxes Buildings, Sub Jail Road, Manjakuppam, Cuddalore-607 001

¶36

https://hcservices.ecourts.gov.in/hcservices/

¶37

2.The Assistant Commissioner (CT), Cuddalore Town Assessment Circle

¶38

1 Commercial Taxes Buildings, Sub Jail Road, Manjakuppam, Cuddalore-607 001

¶39

+1cc to Mr.Adithya Reddy, Advocate SR.No.96525

¶40

+1cc to Government Pleader (Taxes)SR.No.97789

¶41

W.P.No.1340 of 2015 MP.No.1 & 2 of 2015

¶42

RJI(CO)
GMY(14/02/2020)

¶43

https://hcservices.ecourts.gov.in/hcservices/

Tvl.Suba Valli Vilas v. The Appellate Deputy

Case brief

What is this about?

What did the court decide?

Tvl.Suba Valli Vilas v. The Appellate Deputy

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

M/S. Silver Wood Bazaar, Vs the Commercial Tax Officer

M/s.Meenakshi Industries Vs The Assistant Commissioner(Ct)

Icici Bank Ltd. Corporate Off Vs Unin of India Rep. by Its

I. Lakshmanan Vs the Deputy Commissioner

The West Coast Paper Mills Ltd. Vs the Assistant Commissioner(Ct)

M/S.Argus Cosmetics Limited, Vs the Commissioner