Madras High Court
M/S.V.V.V. & Sons Edible Oils Ltd vs The State Tax Officer I on 29 April, 2021
W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 29.04.2021
CORAM:
THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM
AND
THE HONOURABLE MRS. JUSTICE S.ANANTHI
W.A.(MD)Nos.915 to 917 of 2021
and CMP(MD) Nos.4177 to 4179 of 2021
M/s.V.V.V. & Sons Edible Oils Ltd.,
rep. by its Director,
No.443 Main Bazaar
Virudhunagar :Appellant in
all appeals
Vs.
The State Tax Officer I
Virudhunagar-I Assessment Circle,
Virudhunagar : Respondent in
all appeals
PRAYER: Appeals filed under Clause 15 of the Letters Patent against the
orders of this Court in W.P.(MD) Nos.3540, 3545 and 3546 / 2021 dated
30.03.2021.
For Appellant :Mr.K.L.Ramani
Senior Counsel for
Mr.S.Raja Jeya Chandra Paul
https://www.mhc.tn.gov.in/judis/
W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
For Respondents : Ms.J.Padmavathi Devi
Special Government pleader
COMMON JUDGMENT
(Judgment of the Court was delivered by T.S.SIVAGNANAM, J.)
These appeals have been filed by a dealer, who is registered on the
file of the respondent under the provisions of the Tamil Nadu Value
Added Tax and earlier under the provisions of the Tamil Nadu General
Sales Tax Act.
2. In all these appeals, the appellant and the respondent are one
and the same and for easy reference, the appellant is referred to as 'the
assessee' and the respondent is referred to as 'the assessing officer'.
3. The issue involved in these appeals is with regard to the levy of
entry tax under the provisions of the Tamil Nadu Tax on Entry of Goods
into Local Areas Act 2001 (Act No.20 of 2001). The present litigation is
a third round of litigation. Initially, the assessee had challenged the
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W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
validity of the Act and was successful before the High Court. But,
ultimately, the Hon'ble Supreme Court, in the case of State of Tamil Nadu
and others v. ITC Limited and another (Civil Appeal No(s).11086-89 of
2017 dated 23.08.2017, filed by the State, held that the Tamil Nadu Entry
Tax Act is a valid enactment. Pursuant to which, the respondent
Assessing Officer issued notice to the assessee dated 19.08.2019
directing them to file objections to the pre-assessment notice dated
25.08.2004. The assessee filed writ petitions before this Court in W.P.
(MD) Nos.20138, 12130 and 12131 of 2019 challenging the said notices
directing the petitioner to give their objections dated 19.08.2019.
4. The said writ petitions were disposed of following the decision
of this Court in CA Motors v. The Commercial Tax Officer, Thiruvarur
[2019 VIL 448 (Mad)] and directed the assessee to file returns under the
Entry Tax Act in terms of Section 7 of the Entry Tax Act for the
assessment years 2002-03, 2003-04, 2004-05 within the stipulated time
and on returns being filed, the assessing officer was directed to pass
orders.
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W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
5. In terms of the directions issued, though not within the time
permitted, the assessee had filed the returns. The assessing officer, by
order dated 22.12.2020, referring to under what circumstances the pre-
assessment notice was issued, the writ petition filed by the assessee that
direction issued therein and the contents of the returns filed by the
assessee, held that the assessee has not opted for adjustment of entry tax
payment to the regular tax due for the corresponding months and
accordingly proceeded to accept the returns filed under the Entry Tax Act
and determined the tax payable and also levied penalty. Challenging
these orders, the assessee once again approached this Court and filed the
writ petitions. The writ petitions were allowed quashing the assessment
orders and directed the assessing officer to give the benefit of such
converse adjustment. The assessment officer had committed an error
probably due to the fact that he had perused the operative portion of the
order passed in the earlier writ petitions filed by the assessee, which were
disposed of by order dated 19.09.2019, following the judgment in CA
Motors. However, the assessing officer was required to read the
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W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
judgment of CA Motors in its entirety, more particularly, Paragraph 28 of
the order, which gives the benefit of converse credit to the assessee.
Therefore, the learned Writ Court was right in allowing the writ petitions
and directing the assessing officer to allow the benefit of converse
adjustment. However, while doing so in Paragraph 5 of the impugned
order, the writ Court referring to an earlier decision in Sri Karpaga
Moorthy Agencies v. Secretary, Department of Commercial Taxes,
Chennai and another in W.P.(MD) No.19727 of 2015 dated 05.12.2018,
held that the department will be put to loss on account of non payment of
entry tax at the correct point of time. Therefore, in the said case, it was
held that the dealer was bound to pay interest at 2% per month on the
entry tax amount from the date when it is payable till the date under the
tax under other statute is paid.
6. In our considered view, the observations/finding rendered in
Paragraph 5 has to be treated as a finding, which was not required to be
given in the case, especially when the Court has allowed the writ petition
and directed the assessing officer to give the benefit of converse
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W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
adjustment by remanding the matter. Therefore, the Court ought to have
left the issues open for the assessing officer to take an independent
decision.
7. The learned Special Government Pleader appearing for the
respondents had referred to Paragraph 10 of the judgment in the case of
ARAS Motors Private Ltd., v. Assistant Commissioner, (CT), West Veli
Street Circle, Madurai, [2020] 81 GSTR 168 (Mad), wherein the Court
had referred to the decision in the case of S.Girinathan v. Deputy
Commercial Tax Officer, Thirupathur [2015] 77 VST 45 (Mad) and it
was observed the provisions of the Tamil Nadu Additional Sales Tax Act
drew from the Tamil Nadu General Sales Tax only in relation to the levy
of tax and interest and this could not be extended to support the levy of
penalty. Therefore, it is the submission of the learned Special
Government Pleader that this finding is in support of the revenue.
8. In our considered view, it is too early for the writ Court to
render any such finding as to whether the interest is payable or not, as the
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W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
matter is now writ large on the file of the assessing officer to re-do the
entire assessment and with a specific direction to give the benefit of
converse adjustment. Therefore, we are of the view that the observations
made in Paragraph 5 in the impugned order are premature and
accordingly the same is required to be set aside and the issue to be left
open.
9. In the result, the writ appeals are allowed and the finding
rendered in Paragraph 5 of the impugned order is set aside and the issues
are left open and the other directions issued by the learned writ Court be
complied with by the respondent Assessing Officer. No costs.
Consequently connected Miscellaneous Petitions are closed.
[T.S.S., J.] & [S.A.I, J.]
29.04.2021
Index : Yes/No
Internet : Yes
RR
https://www.mhc.tn.gov.in/judis/
W.A.(MD)Nos.915 to 1917 of 2021
VVV and Sons v. The State Tax Officer
T.S.SIVAGNANAM, J
AND
S.ANANTHI, J
RR
Order made in
W.A.(MD)Nos.915 to 917 of 2021
29.04.2021
https://www.mhc.tn.gov.in/judis/
