Allowed

M/s R M Cylinders Unit -Ii Pvt. Ltd. v. Commercial Tax Officer/Assistant Commissioner of State Tax

Telangana HC3 Nov 2023WP/30205/2023

Case brief

AI extract

What is this about?

The High Court set aside three assessment orders dated 26-06-2023 as they were passed beyond the four-year limitation period. The Court affirmed the earlier Division Bench and Supreme Court ruling declaring the legislative amendment extending this period to six years as ultra vires and unconstitutional, depriving the authorities of jurisdiction.

What did the court decide?

The assessment order dated 26-06-2023 is set aside as it was passed beyond the four-year limitation period, and the petitions are allowed.

M/s R M Cylinders Unit -Ii Pvt. Ltd. Vs… — Writ and Judicial Review | Telangana HC (2023)

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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FRIDAY, THE THIRD DAY OF NOVEMBER TWO THOUSAND AND TWENTY THREE

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PRESENT

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THE HON'BLE SRI JUSTICE P.SAM KOSHY AND THE HON'BLE SRI JUSTICE N, TUKARAMJI

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WRIT PETITION NOS: 30560 30376 AND 30205 0F 2023

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wP NO.30560 0F 2023:

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Between:

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M/s Hyderabad _Cylinders Pvt. Ltd.,, Regd. Office situated at No.12, Ground Floor,.Maltinaik Plaza, Hanuman Tekdi, Abids, Hyderabad, rep. by its Director Mr. Vijay Sanghvi S/o Nandtat Sanghvi, Rl/o Hyderabad.

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...PETITIONER

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AND

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1 . Commercial Tax Officer/ Assistant Commissioner of State Tax,, Narayanguda M J Market Circle, 1st floor, Abids Division, Old Kakatiya Hotel, Namdalli Station Road, Hyderabad.

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Peputy.Commissioner (CT), Abids Division,^.1st Ftoor, Otd Kakatiya Hotel, Nampally Station Road, Hyderabad.

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The Authority for clarification and Advance Ruling,, 0/o The Commissioner of Commercial Taxes, Govt. of Telangana, Commislioner of Commercial Taxes Building, lst Floor, Nampally Station Road, Hyderabad.

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The Commissioner of Commercial Taxes,, Girvt. of Telangana, Commissioner of Commercial Taxes Building,lst Floor, Nampally Station-Roai, Hyderabad.

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The State of Telangana, rep. by its Principal Secietarv Revenue (iT) Department, Government of Telangana, Secretariat, Hyderabad.^'

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...RESPONDENTS

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Petition under Article 226 of lhe Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ of Mandamus or any other appropriate writ, order or directions (a) declare the assessment order dated 26-06-2023, passed by the 1st respondent for the tax period from Aptil 2017 to June, 2O1T under TSVAT Act, 2005, beyond the prescribed period of 4 years is barred by limitation and Act No. 26 of 2017 is ultravires and invalid to the constitution of lndia and have no enforceability in the eye of law in extending the period of limitation from 4 years to 6 years (b) Even assuming 6 years period then the April,2017 and May,2O1l is barred by limitation with the expiry of six years (c) levying higher rate of sales

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tax on empty LPG cylinders and their spare parts relying up on the^judgment in the case of IOCL V/s State of Punlab dt.19-05-2009 of Punjatr and Haryana High Court judgment, have no application, to TS VAT Act, 2005 1.o the entry^g0 and entry 100 sub-entry (171 to 1791 of the lVth Schedule to the TSVAT Act,2005, which is complete code and define the commodities (d) When the specific entry 90 and entry 100 sub-entry (171 to 179) of the lVth Schedule to the VAT Act, 2005 defines all kinds of packing material , which includes empty LPG cylinders, and their spare parts levying higher rate of sales tax l4.5percentage treating it as an unclassified commodity is quite illegal, arbitrary, uncon stitutional, contrary to^judicial norms (e) assessment order dt.26-06-2023 served to the petitioner on 01-07 -2023 is an anti dated order^passed in the month of July, 2023 and barred by limitation and consequently set aside the assessment orde| dated 26-06-2023

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.WP NO: 30376 OF 2023

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Between:

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M/s R M Cylinders Pvt. Ltd.,, H. No. Flat No.215, 2nd Floor, Maltinaik Plaza, Hanuman Tekdi, Abids, Hyderabad, rep. by its Director Mr. Hitesh Sanghvi s/o Ramniklal Sanghvi' R/o Hyderabad

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...pETrroNER

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AND

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Commercial Tax Officer/Assistant Commissioner of State'[ax, Narayanguda M J Market Circle, 2nd floor, Abids Division, Old Kakatiya llotel, Nampally Station Road, Hyderabad.

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Deputy Commissioner (CT), Abids Division, 1st Floor, Old Kakatiya Hotel, Nampally Station Road, Hyderabad.

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The Authority for clarification and Advance Ruling,, O/o The Commissioner of Commercial Taxes, Govt. of Telangana, Commissioner of Commercial Taxes Building, lst Floor, Nampally Station Road, Hyderabad.

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The Commissioner of Commercial Taxes,, Govt. of Telangana, Commissioner of Commercial Taxes Building,lst Floor, Nampally Station Road, Hyderabad.

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The State of Telangana, rep. by its Principal Secretary Revenue (CT) Department, Government of Telan gana, Secretariat, or_0.. "rO"r" ar"oNDENT'

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Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, 16s Flrgh Court may be pleased to issue a Writ of Mandamus or any other appropriate writ, order or directions (a) declare the assessment order dated 2610612023^passed by the 1st respondent for the tax period from April 2O17 to June, 2017 beyond the prescribed period of 4 years is barred by limitation, consequr?ntly the Act 26 of 2017 in extending the period of limitation from 4 years to 6 years is ultravires and invalid to the Constitution of India and the assessment order rlt.26106/2023 have

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no enforceability in the^{eye of law (b) Even assuming 6 years period thenthe} April, 2017 and May,^{2017 is barredby limitation with the expiryof six years (c)} levying higher rate of^{sales tax on empty LPG cylinders and their spareparts} relying upon the^{judgmentof the Punjab and Haryana High court in locl V/s} State of Punjab^{dt.19/05t2oog or the Punjab vAT Act, have no application, to TS} VAT Act, 2005 to entry^{90 and entry 100 sub-entry (171 to 179) is complete code} and define the commodities^{(d) whenthe specific entry 90 and entry 100 sub-} entry (171 to 179) of^{the lVth scheduleto the VAT Act, 2005 definesall kinds of} packing material , which includes^{empty LPG cylinders,and their Spare parts} levying higher rate of^salestax @14.5^{Percent treating as an unclassified} commodity is^{quite illegal, arbitrary,unconstitutional,contrary to judicial norms} and consequently set^{aside the assessment order dated 2610612023}

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WP NO: 30205 OF²⁰²³

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Between:

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M/s R M Cylinders^{Unit -ll Pvt Ltd} ,^{R.99!. Office situatedat No 215' 2nd} Fiboi,'trrtittin'ritFlaza,^{Hanuman Tekdi, Ab-ids, Hyderabad,repby its Director} Nri.lbei Sanghvi S/o^{Viiay Kumar Sanghvi, R/o Hyderabad} ...pE,,oNER

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AND

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Commercial Tax Officer/Assistant^{commissionerof StateTax, Narayanguda} fr4l f,i1arrei Circle,^{2nd floor, Abids Division, Old Kakatiya Hotel, Nampally} Station Road,^HYderabad.

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Z. OLoutv Commis'sioner^{(CT), Abids Division,1st Floor, OldKakatiyaHotel'} Nainolttv Station Road,^Hyderabad.

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3 ih; fiiti"riiv'toi ctjririiati6n^{and AdvanceRuting,o/o The commissioner of} " C;;;;;ditaies, oovt. of Telangana, Commissioner of Commercial Taxes guildlns, I st Floor,.Nampally Station Road, Hyderabad'

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+. ifie Coii,missionei^{of Commercial Taxes, Govt. of Telangana, Commissioner} oi Commercial Taxes^{Building,lst Floor, Nampally Station Road, Hyderabad'}

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S. ihe Siuie ot^{ieiangan",rep.f,yits PrincipalSeciglaryRevenue (CT)} - Oepariment, Goveii.rment of Tdlangana, Secretariat, *rO"t"O11h."roNoENrs

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Petition under Article^{226 of the constitutionof lndia praying that in the} circumstances stated^{in the affidavitfiledtherewith,the High court may be} pleased to issue a writ of^{lvlandamus or any other appropriate writ, order or} directions^(a) declare^{the assessment orderdated 26-06-2023 passed by the 1st} respondent for the^{tax period from April 2017 to June 2017beyondthe prescribed} period of 4 years is barred^{by limitation consequently Act 26 of 2017 in extending} the period of limitation^{from 4 years to 6 yearsis ultraviresto the constitution of} lndia, as such the assessment^{order is barred by limitationand the assessment}

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order dt.26-06-2023 have no enforceability in the eye of law (b) Even assuming 6 years period then the AWil, 2017 and [/ay, 2017 is barred by iimitation with the expiry of six years (c) levying higher rate of sales tax on empt)/ L.PG cylinders and their spare parts relying upon the judgment IOCL V/s State of Punjab dt. 19-052009 have no application to TS VAT Act, 2005, when compared to entry^g0 and entry 1 00 sub-entry (171 to 179) of the lVth Schedule to the Act which is complete code and define the commodities (d ) When the specific entr,/ 90 and entry 100 sub-entry (171 to 179) of the lvth Schedule to the VAT Act, 2C05 defines atl kinds of packing material , which includes empty LPG cylinders, and their spare parts levying higher rate of sales tax @14.5 percenlage as unclassified commodity is quite contrary to law, illegal, arbitrary, unconstitutional, contrary to judicial norms and consequently set aside the assessment order dated 26-06-2023

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Counsel for the Petitioner: SRI TEJPRAKASH TOSHNIWAL (ln all the Writ Petitions)

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Counsel for Respondents: SPECIAL SC FOR COMMERCIAL fAXES (ln all the Writ Petitions)

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The Court made the following: COMMON ORDER

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THE HONOURABLE SRI JUSTICE^{P.SAM KOSHY} AND THE HONOURABLE SRI JUSTICE N.TUKARAMJI WRIT PETITION Nos. 3056()^{30376 AND 30205 0F 2023}

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ORDER:/per lron'ble 9i^{Jtrstice' P.SAMKOSHY)}

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These are the three Writ Petitions^where the^{challengeis to} the order, dated 26.06.2023^passed by^{respondentNo.1 for the} assessment period 2Ol7^-2078.

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The primary challenge raised by the^petitioners in the^instant cases is that the authorities^{were lackingjurisdiction to exercise} the power of assessment beyond^{the period of four (4) years which} is otherwise prescribed under the^Act.

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Perhaps the authorities concerned^{proceededwith} the matter under the amended^provision of^{the T.S. V.A.T.Act i.e.,Act 26 of} 2Ol7 . The validity of the said amendment^{was already subjectedto} challenge before this Court in the^case of Sri Sri^Engineering Works & Others Vs. Deputg Commissioner^(CT) 6t^Others, leading case of which is W.P.No.7893 of 2O2O^{wherein the Division} Bench of this court has struck the amendment holding^that it^was beyond the legislative competence of the respondent -^authorities. The order of the Division Bench of this Court was further subjected to challenge before the Hon'ble Supreme Court. The Hon'ble

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PSIT,J & ]YTR,J W.P.No.3O56O o;f 2023 and Batch

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Supremc Court recently in the decision rendcred on 20.1O.2023, in the case of Stdte of Telangana I/s. M/s. Tirumala Constructions & Othersr, has affirmed the judgment of thc Division Bench of this Court declaring the amcndmcnt Act, 26 Af 2077 to be ultra uires and unconstitutional.

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In view of the aforesaid decision of the Division lfcnch of this Court and that of the Hon'ble Supreme Court subsequ(.ntly in thc case of State o.f Telangana Vs. M/s. Titttmala Constrttctions & Others (supra), in the admitted factual backgroun,l u-here the assessment proceedings have been initiated beyond t hr-. period of four (4) years, the impugned order is not sustainable anrj the same deserves and is accordingly set-aside. These Writ pc._it ions stand allowed. Therc shall be no order as to costs.

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Consequently, miscellaneous applications pcnding if any

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shall stand closed.

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i 2o2-9 gce .-tf"l*c qC-. t5 +{

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^^l

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SD/. K. VENKAIAH ASSISTANTREGISTRAR

//TRUE COPY//

&_ SECTION OFFICER

To,

The Commercial Tax Officer/ Assistant Commissioner^{of StateTax,,} Narayanguda M J Market Circle, 1st floor, Abids Division,^t)ld Kakatiya^Hotel, Nampally Station Road, Hyderabad.

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The Deputy Commissioner^(CT), Abids Division,^{1st Floor, Old KakatiyaHotel,} Nampally Station Road, Hyderabad.

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The Authority for clarification and Advance^{Ruling,, 0/o Tht: Commissionerof} Commercial Taxes, Govt. of Telangana, Commissioner of Commercial Taxes Building, lst Floor, Nampally Station Road, Hyderabad.

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