Madras High Court
Tvl.Srei Equipment Finance Pvt. ... vs The Assistant Commissioner on 17 June, 2021
W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 17.06.2021
CORAM:
THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM
W.P.Nos.40116 of 2015, 28526, 37784, 38518 to 38520
& 43963 of 2016 and 2521 of 2017
and M.P.No.1 of 2015
and W.M.P.Nos.24631, 32378, 32379, 32999
& 33000 to 33004, 37788 of 2016
and W.M.P.No.2490 of 2017
W.P.No.40116 of 2015
Tvl.SREI Equipment Finance Pvt. Ltd.,
Represented by the Authorized
signatory/Associate Vice-President,
Rajesh Kumar Dhawan,
290, Peters Road,
Chennai 600 014. .. Petitioner
Vs.
The Assistant Commissioner,
Royapettah Assessment Circle,
Station: 46, Greenways Road,
Chennai 600 028. .. Respondent
Prayer in W.P.No.40116/2015: Writ Petition filed under Article 226 of the
Consitution of India, to issue a Writ of Certiorari, calling for the records
comprised in impugned order in TIN No.33060721690/2013-14 dated
15.10.2015 on the file of the respondent herein and quash the same.
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
(In W.P.Nos.40116 of 2015, 28526, 37784,
38518 to 38520 and 2521 of 2017)
For Petitioner : Mr.AR.L.Sundaresan
(Senior Counsel)
for M/s.Mohammed Shaffiq
For Respondent : Mr.V.Veluchamy
(Government Advocate)
(In W.P.No.43963 of 2016)
For Petitioner : Mr.N.Viswanathan
For Respondent : Mr.V.Veluchamy
(Government Advocate)
COMMON ORDER
The two Writ Petitions in W.P.No.28526 of 2016 and 2521 of 2017 are
filed challenging the notices dated 27.07.2016 and 14.12.2016 respectively.
The other Writ Petitions are filed challenging the assessment orders.
2.The core issue raised in all these Writ Petitions are whether the
benefit of input tax credit is to be extended in respect of the transactions
occurred prior to the issue of amendment in the Tamil Nadu Act 5 of 2015.
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
3.The learned Senior Counsel appearing on behalf of the petitioners
mainly contended that the amendment was effected by way of rectification of
an anomaly and therefore, cannot be construed as a new policy. Thus, the
benefit of Input Tax Credit granted pursuant to the amendment is to be
extended so as to cover the transactions took place prior to the insertion of the
amendment.
4.The learned Senior Counsel contended that the issue involved in these
Writ Petitions were already dealt with elaborately by the Madurai Bench of
the Madras High Court in a batch of Writ Petitions led by
W.P.(MD).No.15103 of 2015 and the said judgment was pronounced on
30.08.2019. Further, the respondent department has also not preferred any
further appeal challenging the said judgment and therefore, the judgment
became final and the said benefit is to be extended to all these petitioners.
5.The learned counsel for the respondent could not be able to object the
said contentions raised on behalf of the writ petitioners. Thus, this Court is
inclined to follow the decision in the case cited supra. The relevant paragraphs
of the said judgment are extracted hereunder:
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
" 7. The claim of the assessee/petitioner
was that with the substitution of sub clause
(v) of Section 19(2), the benefit of ITC was
available in respect of inter-State
transactions whether covered by C-Form or not,
in terms of both Section 8(1) and (2) of the
CST Act. In short, the lis for consideration
before me is 'whether the provisions of
Section 19(2)(v) of the Tamil Nadu Value Added
Tax Act, 2006 as amended by the Tamil Nadu
Value Added Tax Act (Amendment Act, 2015) are
retrospective and would apply to earlier
periods of assessment or prospective, applying
to the period commencing 01.04.2015 only'.
..............
18. An understanding of the provisions of
Section 8 of the CST Act, both sub-sections
(1) and (2), is required, to examine the
purpose of the substitution and to determine
whether such substitution was intended to take
effect from the date of inception of the
enactment or the date of amending Act and the
provision is thus extracted below: 8. Rates of
tax on sales in the course of inter-State
trade or commerce.— (1) Every dealer, who in
the course of inter-State trade or commerce,
sells to a registered dealer goods of the
description referred to in sub-section (3),
shall be liable to pay tax under this Act,
which shall be three percent, of his turnover
or at the rate applicable to the sale or
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
purchase of such goods inside the appropriate
State under the sales tax law of that State,
whichever is lower: Provided that the Central
Government may, by notification in the
Official Gazette, reduce the rate of tax under
this sub-section. (2) The tax payable by any
dealer on his turnover in so far as the
turnover or any part thereof relates to the
sale of goods in the course of inter-State
trade or commerce not falling within
subsection (1), shall be at the rate
applicable to the sale or purchase of such
goods inside the appropriate State under the
sales tax law of that State.
19. Section 8(1) of the CST Act provides
the benefit of concessional rate of tax, upon
production of a statutory Declaration form, to
an interstate transaction with a registered
dealer, and relating to specified goods.
Section 8(2) stipulates that an interstate
transaction with an unregistered dealer shall
be visited with the same rate of tax as
applicable to a domestic transaction involving
identical goods. While Section 19(2)(v)
extended input tax credit in respect of the
transaction under Section 8(1), the same
benefit was unavailable to the identical
transaction with an unregistered dealer,
taxable in terms of Section 8(2) of the CST
Act. Though the benefit of ITC was initially
restricted as an inducement to dealers to
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
transact with registered dealers alone,
Legislature has broadened, in its wisdom, the
grant of benefit of ITC to transactions with
unregistered dealers as well, albeit in 2015.
Having taken such a decision in principle,
there is no rhyme or reason to restrict the
benefit only from the date of substitution.
Such restriction would discriminate against
transactions under Section 8(2) for the prior
period, apart from leading to a dichotomy in
the manner in which transactions in terms of
Section 8(2) pre and post 01.04.2015 are
assessed to tax.
20. It is also not the case of the
revenue that the amendment has been propelled
in 2015 for a specific reason or logic and the
inevitable conclusion I am led to is that
legislature corrected an anamoly in 2015 by
way of the amendment in question, bringing
transactions under Section 8(2) also within
the beneficial sweep of 19(2)(v).
21. Since the substitution in the present
case only seeks to set right an anomaly it
necessarily has to be effective from the date
of inception of the Act itself,
retrospectively.
22. These Writ Petitions are allowed and
the issue framed for resolution is answered in
favour of the petitioners. No costs. Connected
Miscellaneous Petitions are closed."
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W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
6.In view of the ratio laid down in the judgment cited supra, the
impugned orders in all these Writ Petitions are quashed and the Writ Petitions
are allowed. No costs. Consequently, connected Miscellaneous Petitions are
closed.
17.06.2021
gsa
Index : Yes
Speaking Order
To
The Assistant Commissioner,
Royapettah Assessment Circle,
Station: 46, Greenways Road,
Chennai 600 028.
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http://www.judis.nic.in
W.P.Nos.40116 of 2015, 28526, 37784, 38518 to
38520 & 43963 of 2016 and 2521 of 2017
S.M.SUBRAMANIAM, J.
gsa
W.P.Nos.40116 of 2015, 28526, 37784,
38518 to 38520 & 43963 of 2016 and 2521 of 2017
17.06.2021
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