Tripura High Court
Tripura Electricals vs The State Of Tripura on 19 April, 2021
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HIGH COURT OF TRIPURA
AGARTALA
WP(C) No.1745/2017
Tripura Electricals.
Situated at Mantribari Road, P.O. - Agartala, PS - West Agartala,
District - West Tripura, PIN - 799 001.
.............. Petitioner(s).
Vs.
1. The State of Tripura,
represented by Secretary, Department of Finance, New Secretariat
Complex, P.O. - Kunjaban, Agartala, District - West Tripura.
2. The Commissioner of Taxes,
Central Sales Tax Authority, P.N. Complex, P.O. - Kunjaban, Agartala,
District - West Tripura.
3. The Superintendent of Taxes
Charge IV, Palace Compound, P.O. - Agartala, West Tripura.
.............. Respondent(s).
_B_E_ F_O_R_E_
HON'BLE THE CHIEF JUSTICE MR. AKIL KURESHI
HON'BLE JUSTICE MR. S G CHATTOPADHYAY
For Petitioner(s) : Mr. B N Majumder, Sr. Advocate,
Mr. Rajib Saha, Advocate.
For Respondent(s) : Mr. K Dey, Addl. Gov. Advocate,
Mr. A Nandi, Advocate.
Date of hearing & Judgment : 19th April, 2021.
Whether fit for reporting : No.
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J U D G M E N T ( O R A L)
( Akil Kureshi, CJ ).
Petitioner has prayed for a direction to the respondents for issuing
C-Forms as required under Central Sales Tax Act, 1956 ("CST Act" for
short) in favour of the petitioner firm.
[2] Brief facts are as under :
The petitioner is a proprietary concern and originally one Sri
Kalyan Prasad Saha was the proprietor of the concerned. The proprietary
concern was engaged in buying and selling goods within the State of
Tripura and for which it was registered as a dealer under the Tripura Value
Added Tax Act, 2004 ("T-VAT Act" for short) and CST Act. The
proprietor Sri Kalyan Prasad Saha was expired on 13th March, 2014.
According to the legal heirs of the deceased, he had left behind a will
executed on 24th January, 2014 under which he had given his proprietary
business by way of testamentary succession to his elder daughter Smt.
Madhu Chanda Saha alias Misthu Saha after the death of his wife Smt.
Mamata Saha. According to the petitioner, Mamata Saha the wife of the
deceased is still alive. However, for convenience, the elder daughter of the
deceased i.e Madhu Chanda Saha is continuing the same business and
entered into detailed correspondence and has been granted permissions by
the department in the name of the proprietary concern.
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[3] On 27th April 2016, on behalf of the proprietary concern an
application was made to the State Value Added Tax authorities for issuance
of C-Forms for the years 2015-16 in connection with the inter-State
purchases made by the petitioner firm. This would invite tax at reduced
rates. However, the respondents have not issued such C-Forms presumably
on the ground that the petitioner firm is not a registered concern.
[4] Appearing for the petitioner learned Advocate Mr. Rajib Saha
submitted that the respondent authorities were well aware about the death
of the original proprietor of the concern and that his wife and daughter had
inherited the business. It was on this basis that necessary permits for inter-
State purchase of goods were granted and assessments made which were
also challenged before appellate authorities and appeals were entertained. It
would, therefore, be too late in the day for the authorities now to contend
that since the registration of the firm was not amended after the death of the
proprietor, C-Forms cannot be issued.
[5] On the other hand, learned counsel Mr. A Nandi appeared for the
respondents as a special counsel and opposed the petition. Referring to an
affidavit-in-reply dated 29th September 2018 filed by the respondents, he
submitted that it was the duty of the petitioner to have the registration of
the firm duly amended upon the sole proprietor dyeing. The petitioner
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failed to do so. Merely because at one stage certain C-Forms may have
been issued would not give a vested right to the petitioner to claim such
certificates for subsequent transactions. Even an unregistered dealer is
liable to pay taxes.
[6] Having heard learned counsel for the parties and having perused
documents on record, we notice that Section 6 of the CST Act creates a
liability on every dealer to pay tax as per the prescribed rates. Sub-section
(1) of Section 6 provides that subject to the other provisions of the Act,
every dealer shall, with effect from such date as the Central Government
may notify, be liable to pay tax under the Act on all sales of goods other
than electrical energy effected by him in course of inter-State trade or
commerce. Section 7 of the Act pertains to registration of dealers. Under
sub-section (1) of Section 7, every dealer liable to pay tax under the Act
has to get himself registered within such time, as may be prescribed, by
making an application for such purpose. Sub-section (1) of Section 8 of the
Act provides that every dealer who in 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 which shall be three per cent of
his turnover or at the rate applicable under laws of the State where the sale
takes place, whichever is lower. It is in this context, the requirement for the
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petitioner to obtain C-Form arises. However, one thing may be noted that
the liability to pay tax under Section 6 of the CST Act is not connected to
the requirement of registration under Section 7. Registration, of course, is
necessary for claiming concessional rate of tax on inter-State sale.
[7] With this background in mind, we may refer to the provisions of
T-VAT Act. Section 19 of the T-VAT Act pertains to compulsory
registration of dealers. Sub-section (1) of Section 19 provides that no dealer
while being liable to pay tax under the Act shall carry on the business
unless he has been registered and possesses a certificate of registration.
Every such dealer would make an application for registration as provided in
sub-section (2) of Section 19. Such registration shall be granted if the
Commissioner is satisfied about its requirements, as provided in sub-
sections (3) and (4) of Section 19. Sub-section (5) of Section 19 provides
that the Commissioner may, from time to time, amend any certificate of
registration in accordance with information furnished or otherwise received
and such amendment may be made with retrospective effect in such
circumstances and subject to such restrictions and conditions as may be
prescribed. Sub-section (6) of Section 19 pertains to situations where a
registration shall be cancelled by the Commissioner. Clause (e) of sub-
section (6) provides that when the owner of an ownership business dies
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leaving no successor to carry on the business the same shall be cancelled by
the Commissioner.
[8] Under Rule 16 of the Tripura Value Added Tax Rules, 2005 ("T-
VAT Rules" for short) a dealer can apply for amendment of certificate of
registration. Sub-rule (1) of Rule 16 provides that when any registered
dealer furnishes any information in accordance with sub-section (5) of
Section 19 to the Superintendent of Taxes within 14 days of occurrence of
the event along with the certificate of registration for amendment or
cancellation thereof, the concerned Superintendent of Taxes shall amend
the certificate accordingly after making such inquiry as he deems fit.
[9] In the present case, we find that though the petitioner never
applied for amendment of the registration after the death of the sole
proprietor of the concern, the information in this respect was available with
the department and in any case, even after the death of the proprietor the
business was continued by the wife of the deceased with the help of the
elder daughter who were to inherit the business in succession.
[10] We have noticed that a valid registration is necessary for a dealer
to claim concessional rate of tax on inter-Sate sale of goods under Section 8
of CST Act. The demand of the petitioner, therefore, for the authorities to
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issue C-Form without amending the registration, therefore cannot be
accepted. However, as noted, since the department has also virtually
accepted the succession of the business upon death of the sole proprietor,
let the petitioner even now apply for amendment of the registration
certificate. If such applications are filed within a period of two weeks from
today with supporting documents, the superintendent shall after following
the procedure laid down in Section 19(5) T-VAT Act and Rule 16 of the T-
VAT Rules shall dispose of such application as expeditiously as possible. If
he does accept the application, the same would have effect from the date of
death of the sole proprietor. If such amendment in the registration is
granted it would be open for the petitioner to re-activate the request for
grant of C-Form on inter-State transactions which shall be decided on
merits.
With these observations and directions the petition is disposed of.
Pending application(s), if any, also stands disposed of.
( S G CHATTOPADHYAY, J ) ( AKIL KURESHI, CJ )
Sukehendu
