Jharkhand High Court
Homi Modi Street vs The State Of Jharkhand on 12 February, 2025
Author: Deepak Roshan
Bench: Deepak Roshan
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P.(T) No. 7276 of 2023
M/s. Tata Motors Limited, a Company deemed to be registered under the
Companies Act, 2013, having its registered office at Bombay House, 24,
Homi Modi Street, Mumbai-1, and having its Manufacturing Unit at
Jamshedpur, P.O.-G.M. Works, P.S. Telco Colony, Jamshedpur, District East
Singhbhum; through its Authorized Signatory-cum Deputy General Manager
(Finance), Indirect Taxation, namely, Pankaj Kumar Patwari, aged about 54
years, son of Late Shankar Lal, resident of K3-28, Telco Colony, P.O. Telco,
P.S. Telco, Jamshedpur, District East Singhbum, PIN-831004.
.... Petitioner
-VERSUS-
1. The State of Jharkhand, through the Secretary, Commercial Taxes
Department, having its office at Jharkhand Mantralaya (Project Building),
P.O. Dhurwa, P.S. Jagannathpur, District Ranchi, PIN 834 002 (Jharkhand).
2. Additional Commissioner of State Tax (Appeal), Jamshedpur
Division, Jamshedpur, having its office at Sakchi, P.O. and P.S. Sakchi,
District Singhbhum East.
3. Joint Commissioner of Commercial Taxes (Administration)-
cum-Additional Commissioner, State Tax, having its Office at Sakchi,
P.O. and P.S. Sakchi, District Singhbhum East.
4. Deputy Commissioner of Commercial Taxes, Jamshedpur Circle,
Jamshedpur, having its office at Sakchi, P.O. and P.S. Sakchi, District
Singhbhum East.
5. Commercial Taxes Officer, Jamshedpur Circle, Jamshedpur, having
its office at Sakchi, P.O. and P.S. Sakchi, District Singhbhum East.
.... Respondents
CORAM: HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE DEEPAK ROSHAN
For the Appellant : Mr. Sumeet Kumar Gadodia, Advocate
Mrs. Shilpi Sandil Gadodia, Advocate
Ms. ShrutiShekhar, Advocate
Ms. SanyaKumari, Advocate
For the Respondents : Mr. Ashok Kumar Yadav, Sr. SC-I
Mr. Aditya Kumar, AC to Sr. SC-I
C.A.V. On 23.01.2025 Delivered on.12 /02/2025
Per Deepak Roshan J.
JUDGMENT
1. The present writ application has been filed praying therein for
the following reliefs:-
(i) For issuance of an appropriate writ/order/direction, for
quashing/setting aside the order contained in Memo No. 416 dated
24.07.2023 (Annexure-11) passed by Respondent No.2-Additional
Commissioner of State Tax (Appeal), Jamshedpur Division, Jamshedpur in
Appeal Case No. JR/JKSYA-05/2023-24 for the period 2005-06, wherein the
appeal filed by the Petitioner in terms of 'Jharkhand Karadhan Adhiniyamon
Ki Bakaya Rashi Ka Samadhan Act, 2022' (hereinafter referred to as
'Settlement Scheme of 2022' for short), has been dismissed.
(ii) For issuance of further appropriate writ/order/direction, including
Writ of Certiorari, for quashing/setting aside the order of settlement dated 3rd
May, 2023 (Anneuxre-9) passed by Respondent No.3 under Settlement
Scheme of 2022 pertaining to the period 2005-06 to the extent the amount of
pre-deposit of Rs. 10,99,86,196/-, being the amount of disputed tax paid by
Petitioner has not been allowed to be adjusted against the final settlement
amount while issuing settlement order, due to which, Petitioner was
compelled to deposit excess payment of Rs. 6,59,91,717/-, or alternatively Rs.
6,48,53,542/- as per revised computation filed before the Appellate Authority
(Annexure-15) is also neither sustainable in law nor in facts and the same is
liable to be quashed / set aside.
(iii) For issuance of further appropriate writ/order/ direction, including
Writ of Mandamus, directing the Respondents to refund an amount of Rs.
6,59,91,717/- or alternatively, Rs. 6,48,53,542/-as per revised computation
filed before the Appellate Authority (Annexure-15) being the excess amount
realized by them in terms of Settlement Scheme of 2022 by adopting the
mechanism of deducting the amount of pre-deposit made by Petitioner against
the disputed tax and, thereafter, conferring the benefit of waiver of tax to the
Petitioner in a most illegal and arbitrary manner.
(iv) For issuance of further appropriate writ/order/ direction directing
the Respondents to make payment of interest @ 18% per annum on the
amount of Rs.6,59,91,717/- or alternatively, Rs. 6,48,53,542/- as per revised
computation filed before the Appellate Authority (Annexure-15) from the
date of deposit i.e. 28.04.2023, till the date of refund of the said amount.
(v) For issuance of any other appropriate writ(s)/ order(s)/direction(s),
as Your Lordships may deem fit and proper in the facts and circumstances of
the case.
2. Brief facts of the case as evident from the records is that
petitioner is engaged in manufacturing and selling of heavy and
medium commercial vehicles and its spare and accessories and is also
having its unit at Jamshedpur in the District of East Singhbhum, State
of Jharkhand.
3. The present writ petition relates to dispute of financial year
2005-06 under Bihar Finance Act, 1981. For the period in dispute, an
assessment order dated 31.12.2008was passed by assessing officer,
wherein as against the admitted tax liability of Rs. 71,81,88,492/-
assessment of tax was made for an amount of Rs. 1,69,29,74,179/- and
an amount of Rs. 49,996/- was paid as admitted tax pursuant to
assessment and, thus, disputed tax remained as Rs. 97,47,35,691/-.
Against the said order, petitioner after exhausting the remedy of appeal
and revision filed writ petition before this Hon'ble Court vide W.P.(T)
No.4152 of 2015. It is an admitted fact that as against the disputed tax
liability of Rs. 97,47,35,691/- petitioner deposited on various dates an
amount of Rs. 10,99,86,196/- which was primarily deposited by it
either towards pre-deposit and/or amounts towards condition of stay
passed by various forms.
4. In the meanwhile, State of Jharkhand formulated an Amnesty
Scheme namely, ''Jharkhand Karadhan Adhiniyamon Ki Bakaya Rashi
Ka Samadhan Act, 2022' [hereinafter referred to as 'Amnesty
Scheme'] and even Rules for giving effect to the said scheme was also
formulated namely, 'Jharkhand Karadhan Adhiniyamon Ki Bakaya
Rashi Ka Samadhan Rules, 2023' [hereinafter referred to as 'Rules of
2023'].
5. Petitioner being desirous of availing benefit under the Scheme
filed online application in prescribed format in terms of Rule 3(1) of
Rules of 2023 but it is the case of the petitioner that while filing online
application formsuo-motu computation of the benefit under Amnesty
Scheme was determined, wherein the amount of pre-deposit of Rs.
10,99,86,196/- was first adjusted against the disputed amount and upon
remaining balance, waiver of 60% and 50% of tax respectively was
extended to petitioner. The same was illustrated as under:-
Amount admitted in Return 71,81,88,492/-
Amount of Tax assessed 1,69,29,74,179/-
Balance to be paid (after adjustment of Rs. 97,47,35,691/-
49,996/- paid in respect of assessed tax).
Less amount of pre-deposit 10,99,86,196/-
Remaining Balance 86,47,49,495/-
Waiver granted [60% of Rs. 97,24,59,340/- 51,86,22,062/-
after deduction of Rs. 10,99,86,196 & 50% of
Rs.22,76,351/-, i.e. waiver of Rs
51,74,83,886/- + 11,38,176/-]
Amount directed to be paid 34,61,27,433/-
6. It is the case of petitioner that under the Settlement Scheme,
60% waiver of disputed tax under Section 3 was applicable, where
disputed tax related to amount other than certificate/declaration forms
and in respect of declaration forms/certificates waiver of tax to the
extent of 50% was admissible. According to petitioner, waiver
pertaining to disputed tax should have been applied first before
adjusting pre-deposit/deposit amounts and had the said methodology
been adopted by respondents, total settlement amount would have been
Rs. 28,01,35,716/-.
7. However, since respondents first adjusted the amount of pre-
deposit from the amount of disputed tax and, thereafter, applied waiver
under the scheme, an amount of Rs. 34,61,27,433/-was determined to
be paid by petitioner while computing settlement amount on
18.04.2023 which the petitioner was compelled to pay under protest on
18.04.2023. As per petitioner due to aforesaid incorrect application of
scheme, petitioner was compelled to pay an extra amount of
Rs.6,59,91,717/-.
8. Thereafter, settlement order for Rs. 34,61,27,433/-was passed
on 03.05.2023 against which in terms of Amnesty Scheme, vide
Section 8 thereof, petitioner preferred an appeal before Additional
Commissioner of State Tax (Appeal), Jamshedpur Division,
Jamshedpur. However, appellate authority vide its order contained in
Memo No. 416 dated 24.07.2023, confirmed the order of settlement
andheld that amount of pre-deposit made by petitioner was to be first
deducted from disputed amount and only thereafter, benefit under the
Scheme was to be extended to petitioner.
9. However, from the records and statements made in the writ
petition and revised computation given vide Annexure-15, it would
transpire that petitioner during the appellate proceedings gave a revised
computation taking into consideration the amount of tax pertaining to
declaration forms and, as per the said revised computation as against an
original refund of Rs.6,59,91,717.50 claimed by petitioner refund of
Rs. 6,48,53,542/- was only claimed. In fact, from Annexure-15, it
would be evident that petitioner before appellate authority made prayer
for refund as per alternative computation.
10. Mr. Sumeet Kumar Gadodia, learned counsel appearing for
petitioner submitted that under Amnesty Scheme, provisions were
incorporated for giving waiver of disputed tax to the extent of 60% and
50% of the disputed amount and the term 'admitted tax' and 'disputed
amount' is defined under Amnesty Scheme itself vide Section 2(i) and
2(viii).
11. It was further submitted that Section 3 of Amnesty Scheme
clearly provided, inter alia, that amount of waiver was to be calculated
being the difference between the tax component of assessed tax and the
amount of tax already paid. It was submitted that the term amount of
tax already paid is the amount of admitted tax paid by an assessee and
would not include any amount pertaining to disputed tax which has
been paid either as pre-deposit or as condition of stay, etc.
12. It has been submitted that almost identical provisions of Central
Amnesty Scheme i.e. Sabka Vishwas (Legacy Dispute Resolution)
Scheme, 2019 came up for interpretation by this Hon'ble Court,
wherein exactly similar dispute was adjudicated by this Hon'ble Court
and it was held that intent of the Scheme was to give waiver of disputed
tax amount and, merely, because some amount towards pre-
deposit/deposit is made by an assessee, the same cannot be first
deducted from disputed tax amount for determining the measure for
extending benefit of waiver.
13. Per contra, Mr. Ashok Yadavcounsel for Respondent-State
while referring to the paragraphs of the Counter Affidavit submitted
that it is an admitted fact that petitioner deposited an amount of Rs.
10,99,86,196/- pursuant to demand notice under protest, but, the moot
question for adjudication would be as to whether the amount deposited
by petitioner under protest would remain a disputed amount of tax or a
tax realized against the demand raised by revised orders passed
pursuant to remand order passed by appellate authority.
14. It has been submitted that although amounts were deposited
under protest but once remand assessment orders were passed and the
amounts paid under protest were adjusted against disputed demand,
then the said amounts paid under protest would stand appropriated
against the disputed amount and disputed amount to that extent would
stand reduced.
15. It was further submitted that under the Scheme, definition of
disputed amount would mean the amount disputed by an assessee
minus the amount already paid by it at any interim stage of the
proceedings, may be either as pre-deposit/deposit/suo-motu deposit etc.
and, thus, while passing the settlement order, rightly the settlement
officer issued certificate after first adjusting the amount of pre-deposit
from disputed amount and, thereafter, extending the benefit of waiver
under the Scheme.
16. We have carefully considered the submissions of the parties at
bar and perused the provisions of 'Jharkhand Karadhan Adhiniyamon
Ki Bakaya Rashi Ka Samadhan Act, 2022' and the corresponding
Rules. For the sake of ready reference, certain relevant provisions of
the aforesaid Amnesty Scheme is quoted herein under:-
2 DEFINITIONS-
(i) "Admitted tax"- means the amount of tax admitted as being payable as per the
returns filed by the person under the relevant Act;
(ii) "Assessed tax"- means tax, interest and penalty determined as being payable
under an order of assessment or reassessment under the relevant Act;
(vii) "Dispute" means an Appeal, Revision, Review, Reference, Writ Petition, or
Special Leave Petition, arising out of any order passed under the relevant Act
and pending before, as the case may be, the following:-
(i) The Additional/Joint Commissioner of Commercial Taxes/State Tax
(Appeal);
(ii) The Additional/Joint Commissioner of Commercial Taxes/State tax
(Administration);
(iii) The Commissioner of Commercial Taxes;
(iv) The Commercial Taxes Tribunal;
(v) The Central Sales Tax Tribunal
(vi) The High Court;
(vii) The Supreme Court of India;
Explanation:- For the purposes of this clause a dispute includes:
(i) Any levy of tax, interest and penalty by an authority prescribed
and/or authorized under the relevant Acts, which has not been
paid into Government Treasury, or
(ii) A proceeding for recovery of any tax, interest, or penalty pending
for recovery under the Bihar and Orissa Public Demand
Recovery Act, 1914;
(viii) "Disputed Amount" , in relation to a dispute, means any tax or interest or
penalty which has been determined as being payable by the person pursuant to
an order of assessment, reassessment, scrutiny or any other order made or
passed under the Relevant Acts and which is not admitted and for such demand
a litigation has been filed before any Appellate Authority or Forum but shall
not include any demand in pursuant to an order of assessment, reassessment,
scrutiny or any other order made or passed under the Relevant Acts where the
Government has filed any case against such demand before any Appellate
Authority or higher Courts.
17. A perusal of Settlement Scheme would reveal that under
Settlement Scheme, term 'admitted tax' is defined to mean an amount
of tax admitted as being payable as per return filed by an assessee, and,
the term 'disputed amount' means the amount of tax, interest or penalty
which is determined as payable by an assessee pursuant to an order of
assessment/re-assessment/scrutiny or any other order and which is not
admitted, and, for such demand, a litigation has been filed by an
assessee.
18. Thus, under the Scheme, amount of 'admitted tax' clearly
represents an amount which is admitted by assessee, whereas 'disputed
amount' means amount of tax, interest or penalty which is in dispute
pursuant to a litigation filed by an assessee.
19. Under Section 3 of Settlement Scheme, waiver is provided to
the extent of 60% disputed amount being other taxes and waiver of
50% was provided where disputed tax related to declaration
forms/certificates in the following manner:-
20. other than disputed amounts pertaining to declaration form
wherein, waiver of 50% of disputed amount in the following manner:-
'3. Determination of Settlement amount.- Subject to other provisions of this Act,
old arrears of tax or tax in a dispute pending under the relevant Act may, on an
application made in this behalf by a person, be settled upon payment of the
settlement amount as specified in column 3 and 4 of the Table below:
No. Type of Cases Settlement amount
1 2 3 (Tax) 4 (Interest)
1 Arrear of 100% amount of 10% of unpaid
admitted tax, admitted tax amount of
interest and interest and
penalty penalty (90%
waiver).
2 Arrear amount of 40% of the difference 10% of the
assessed tax upto between the tax unpaid
Financial year component of assessed amount of
2017-18. tax and the amount of interest and
tax already paid (60% penalty in that
waiver) statutory
order (90%
waiver)
3 Arrear amount 50% of the unpaid 10% of the
related to amount of tax calculated unpaid
statutory after the deduction of amount of
declarations (50% waiver) interest and
/Forms/certificates (a) The amount of tax penalty as per
upto Financial involved in the value of statutory
Year 2017-18 acceptable Forms/ order (90%
Certificates/Declarations waiver)
submitted by the
applicant before the
prescribed authority
under this Act, and
(b) The amount already
paid towards the total
arrear of tax.
4 Any arrear in 40% of tax in dispute 10% of the
dispute other than provided the same has unpaid
mentioned in Sl. not been amount of
No. 1, 2 and 3 declared/considered in interest and
any order/ penalty as per
assessment/reassessment statutory
(60% waiver) order (90%
waiver)
Provided that, where the amount of tax involved in the value of acceptable
forms/ certificates/ declarations, alongwith the amount already paid, becomes
more than the arrear amount, no refund shall be made as a result of the
Settlement.
Provided further that, no application for settlement shall be entertained by the
authority, in which the State Government/Department has moved to higher
court.
Explanation-I Where settlement application is made only against interest and
penalty order, it shall be considered provided the relevant tax component in the
statutory order has been paid;
Explanation-II For the purpose of settlement of dispute, each statutory
order/Demand Note issued by the department/ authority shall be construed as
one dispute and person has to apply separately for settlement for each such
dispute.'
21. In our considered opinion, this calculation made by the
respondent is erroneous for the following reason:-
If an assessee is having a liability of Rs.1 crore and he does not
pay any amount, he will get benefit of 60% waiver as per the scheme
and he will have to pay Rs. 40 lakhs.
But if an assessee who is having a tax liability of Rs. 1 Crore,
pays as pre-deposit pending appeal Rs. 30 lakhs, his balance tax
liability is Rs. 70 lakhs; benefit which is to accrue to him cannot be
computed at 60% of Rs. 70 lakhs i.e., Rs.42 lakhs.
If this is done, then he would be worse off by paying Rs.30
lakhs ( as he would get a lesser benefit of only Rs. 42 lakhs under the
scheme) than an assessee who does not pay any amount pursuant to
demand and gets waiver of 60% of Rs.1 Crore i.e. Rs. 60 Lakhs.
This could never have been the intention of the scheme.
Similar view has been taken in Vassu Enterprises & analogous
cases v. Union of India &Ors.1 while interpreting the Central Amnesty
Scheme i.e. Sabka Vishwas (Legacy Dispute Resolution) Scheme,
2019, it was held:-
'28. Even from a plain reading of Section 124(2), it would be evident that the amount
of deposit made during enquiry, investigation or audit is required to be deducted after
extending relief under section 124(1) of the Scheme and at the time of issuing
statement indicating the amount payable by a declarant.
Even otherwise, the intent of legislature cannot be in such a way that an assesse who
pays some amount either suo motu prior to demand or after demand put in worse
condition than an assesse who does not pay any amount after demand and avail the
benefit of the scheme because admittedly; if the contention of the revenue is accepted
then if an assesse is having liability of 1 crore rupees and he does not pay any amount
then he will get benefit of 40% as per the scheme and he will have to pay 60 lacs.
However, if an assesse who is having a demand of 1 crore and during course of
investigation or otherwise he pays an amount of 30 lacs then if 40% will be deducted
from 70 lacs than he would be in worse position than anassesse who does not pay any
amount pursuant to demand. This can never be the intent of the scheme.'
22. In the present case, disputed tax of the petitioner also pertained
to non-furnishing of declaration forms and, thus, waiver of tax to the
extent of 60% and 50% respectively were applicable to petitioner. It is
not in dispute that disputed amount was Rs. 97,24,59,340/- and amount
of Rs. 10,99,86,196/- was deposited as pre-deposit and/or condition of
stay.
(2023) 11 GSTR 21
23. In our opinion, difference between disputed tax and admitted
tax was the amount in dispute and under the scheme, petitioner was
entitled for waiver of 60% and 50% respectively, but while computing
the tax liability, Settlement Officer first deducted the amount of pre-
deposit from the amount in dispute and, thereafter, extended the benefit
of waiver under the scheme which is clearly travelling beyond the
contours of the scheme itself.
24. The methodology adopted by the assessing officer can be
summarized in the following chart:-
Amount admitted in Return 71,81,88,492/-
Amount of Tax assessed 1,69,29,74,179/-
Balance to be paid (after adjustment of Rs. 97,47,35,691/-
49,996/- paid in respect of assessed tax).
Less amount of pre-deposit 10,99,86,196/-
Remaining Balance 86,47,49,495/-
Waiver granted [60% of Rs. 97,24,59,340/- 51,86,22,062/-
after deduction of Rs. 10,99,86,196 & 50% of
Rs.22,76,351/-, i.e. waiver of Rs
51,74,83,886/- + 11,38,176/-]
Amount directed to be paid 34,61,27,433/-
25. So, in our opinion, determination of tax liability under the
Scheme was to be undertaken in the following manner and not as done
by the assessing officer :-
Part-1
Admitted amount as per return of the Petitioner. Rs. 71,81,88,492/-
Amount paid as admitted tax Rs. 71,81,88,492/-
Balance to be paid as admitted tax Rs. 0/-
Tax assessed by the Assessing Officer (other Rs. 97,24,59,340/-
than rejection of claim arising out of non-
submission of declaration Forms)
Amount paid in respect of assessed tax Rs. 49,996/-
Remaining Balance to be paid Rs. 97,24,59,340/-
Settlement amount to be paid (40% of Rs. 38,89,83,736/-
Remaining Balance)
Part-2
Arrear amount arising out of the non- Rs. 22,76,351/-
submission of the declaration Forms.
Tax amount arising out of Value of declaration 0
Forms which are now available but not
considered
Balance of tax amount arising out of value of Rs. 22,76,351/-
forms which are not supported with declaration
Forms.
Settlement amount to be paid (50%) Rs.11,38,175/-
Total settlement amount Rs. 39,01,21,911.50
Amount of Pre-deposit Rs.10,99,86,186/-
Balance to be paid Rs. 28,01,35,716/-
Settlement Amount determined by Assessing Rs. 34,61,27,433/-
Officer
Excess amount determined Rs.6,59,91,717/-
26. Thus, we are of the opinion that petitioner is right in contending
that due to incorrect application of Settlement Scheme, petitioner is
denied its actual benefit which resulted into a loss of
Rs.6,59,91,717.50/- ( 34,61,27,433-28,01,35,7160. However, before the
appellate authority, petitioner filed its revised computation taking into
consideration the component of declaration form and claimed as per
revised computation an amount of Rs. 6,48,53,542/- as refund. Hence,
we are of the opinion that petitioner cannot take a different stand than
what it has taken in the appellate proceedings and it can only be entitled
for refund as per the revised computation submitted before the appellate
authority being an amount of Rs. 6,48,53,542/-.
27. Admittedly, Settlement Scheme is a beneficial scheme and
Hon'ble Supreme Court in its judgment rendered in the case of
Government of Kerala and Another v. Mother Superior Adoration
Convent reported in (2021) 5 SCC 602, has held that even in tax
statutes, exemption provisions should be liberally considered in
accordance with the object sought to be achieved. In a beneficial
legislation, literal formalistic interpretation should be eschewed to give
full effect to the provisions of the beneficial legislation.
28. In view of the facts stated hereinabove, impugned order passed
by the appellate authority contained in Memo No. 416 dated
24.07.2023 in Appeal Case No. JR/JKSYA-05/2023-24 for the period
2005-06 is set aside and, further, order of settlement to the extent,
amount of pre-deposit of Rs. 10,99,86,196/- was directed to be adjusted
from the amount in dispute before extending the benefit of settlement is
set aside.
29. Consequentially, a writ of mandamus is issued upon
respondents to refund an amount of Rs. 6,48,53,542/- to petitioner
realized in excess by them under the Scheme of 2022. Petitioner would
further be entitled for payment of interest on the aforesaid amount of
Rs. 6,48,53,542/- from the date of deposit i.e. 28.04.2023 till the date of
refund of the said amount @ 6% p.a. The aforesaid exercise shall be
completed by the respondent-authorities within a period of eight weeks
from today.
30. Pending, I.As., if any, stand disposed of. There shall be no
order as to costs.
(M.S. Ramachandra Rao, C.J.)
(Deepak Roshan, J.)
Amardeep/-
