M/S. Aruna Alloy Steel Private Limited vs The Assistant Commissioner (Ct)
2024 Latest Caselaw 7554 Mad

Citation : 2024 Latest Caselaw 7554 Mad
Judgement Date : 8 April, 2024

Madras High Court

M/S. Aruna Alloy Steel Private Limited vs The Assistant Commissioner (Ct) on 8 April, 2024

Author: C.Saravanan

Bench: C.Saravanan

                                                                W.P.(MD) Nos.2133 to 2138 of 2017

                          BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT

                                               DATED : 08.04.2024

                                                     CORAM

                                  THE HON'BLE MR.JUSTICE C.SARAVANAN

                                     W.P.(MD)Nos.2133 to 2138 of 2017
                                                     &
                           W.M.P.(MD).Nos.1769,1770,1771,1772,1773 and 1774 of 2017

                    W.P.No.2133 of 2017

                    M/s. Aruna Alloy Steel Private Limited
                    represented by its Director SV.Arunachalam
                    Survey No.3/1, Olaganeri Village
                    Uthanguid (PO), Madurai                                    ... Petitioner


                                                        Vs.

                    The Assistant Commissioner (CT)
                    Tallakulam Assessment Circle
                    Madurai                                                   ... Respondent


                    Prayer: Writ Petition filed under Article 226 of Constitution of India for

                    issuance of a Writ of Certiorarified Mandamus calling for the records in

                    TIN33384882329/2010-11 dated 28.11.2016 and quash the same as

                    illegal, arbitrary, and against the dictum laid down in the judgment of this

                    Hon'ble Court in the case of Interfit Techno Products Ltd Vs. Principal

                    Secretary/Commissioner of Commercial Taxes reported in (2015) 81 VST


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https://www.mhc.tn.gov.in/judis
                    Page No. 1 of 5
                                                                 W.P.(MD) Nos.2133 to 2138 of 2017

                    389 and direct the respondent to pass order afresh by following the

                    directions given by this Court in the above case, after affording

                    opportunity of being heard.

                                   For Petitioner    : Mr.S.Karunakar

                                   For Respondent    : Mr.J.K.Jeyaseelan, Govt.Advocate

                                                        *****

                                              COMMONORDER

By this common order, all these Writ Petitions are being disposed

of.

2. In these Writ Petitions the petitioner has challenged the

impugned assessment order dated 28.11.2016 for the assessment year

2008-09 till 2013-2014. The dispute pertains to denial of input tax credit

on input lost in the course of manufacture as invisible loss. The

department had earlier issued a circular dated 20.10.2011. The circular

was subject matter of a challenge before the Hon'ble Division Bench in a

batch of Writ Petition lead case being Eastman Exports Global Clothing

(P) Ltd. The Hon'ble Division Bench has considered the circular issued by

the Commercial Tax Department and has passed the final order on

28.02.2023. Operative portion of the order of the Hon'ble Division Bench

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W.P.(MD) Nos.2133 to 2138 of 2017

reads as under:

“......

On analysis of the scope and interplay between Sections 19(2)(ii) and 19(9) of the TNVAT Act, precedents dealing with manufacturing/invisible loss and the rules of construction referred above we find that Section 19(9) of the TNVAT Act would not get attracted to manufacturing/invisible loss which is inevitable and inherent part of manufacture and thus covered by Section 19(2)(ii) of the TNVAT Act. However, this would not preclude the assessing authority from enquiring if the claim of use of input in manufacture is genuine or otherwise.”

3. Already, this Court has also taken a favorable view under a

similar circumstances in the case of M/s. GBR Metals Pvt Ltd Vs. The

Assistant Commissioner (CT) in W.P.Nos.22304 to 22309 of 2016 dated

28.02.2020.

4. Considering the same, the impugned orders are set aside and the

cases are remitted back to the respondent to pass denovo order within a

period of 60 days duly considering the decision rendered by the Hon'ble

Division Bench in Eastman Exports Global Clothing (P) Ltd dated

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W.P.(MD) Nos.2133 to 2138 of 2017

28.02.2023 and the decision of this Court in M/s.GBR Metals Pvt Ltd Vs.

The Assistant Commissioner (CT) in W.P.Nos.22304 to 22309 of 2016

dated 28.02.2020. While passing the denovo order, the respondent may

also consider the statement gathered by the Commercial Tax Department

pursuant to the interim order passed by this Court on 03.04.2017.