M/S.Jmc Projects (INDIA) LTD vs. Joint Commissioner Of State Tax
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M/s. JMC Projects (India) Ltd. (Petitioner) filed a writ petition seeking a mandamus directing the respondent authorities to issue Form 'C' declarations. The Petitioner, a registered dealer under the Central Sales Tax Act, 1956, and migrated to GST, had executed projects in Telangana during the financial years 2016-17 and 2017-18 (April 1, 2017, to June 30, 2017). For goods procured from outside Telangana, the Petitioner was entitled to a concessional tax rate of 2% upon furnishing Form 'C'. The Petitioner alleged that despite regular tax payments and no arrears, the respondents failed to issue the forms. The respondents, through a counter-affidavit, cited a circular dated August 17, 2020, which mandated applications to jurisdictional officers due to the disabling of online access for obtaining 'C' forms. They also contended that the Petitioner did not file lorry receipts to establish inter-state movement of goods.
Held
The Court held that the explanation provided by the respondent authorities was inadequate to deny the 'C' forms to the petitioner. There was no allegation of short deposit of taxes or suppression/misstatement of goods by the petitioner. The Court referred to a Division Bench judgment of the same High Court in A.P. Gas Power Corporation Ltd. v. Assistant Commercial Tax Officer, which held that at the stage of issuing a 'C' declaration form, the notified authority is not required to conduct an inquiry into the nature of the transaction. The authorities are only required to examine if the applicant is a registered dealer, if the goods are included in the certificate of registration, and if the payment for the form has been made. The Court also noted that the Jharkhand High Court in Tata Steel Limited v. State of Jharkhand had held that once a dealer satisfies the conditions of being a registered dealer authorized to purchase goods and has paid the charges for 'C' forms, the authorities are bound to issue them. Consequently, the Court directed the respondents to issue the 'C' forms to the petitioner for the specified periods within fifteen days.
Key Issues
1. Whether the respondent authorities are obligated to issue Form 'C' declarations to the petitioner for the period 2016-17 and 2017-18 (April 1, 2017, to June 30, 2017), considering the Petitioner's entitlement to a concessional tax rate under Section 8(3) of the Central Sales Tax Act, 1956, subject to furnishing Form 'C' as per Section 8(4) and Rule 12(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957? Petitioner's Arguments: The Petitioner argued that they are entitled to the 'C' forms as they are a registered dealer, have paid taxes regularly, and have no arrears. They contended that the respondents' refusal to issue the forms, despite proof of inter-state sales and goods transport, is unjustified. They relied on the principle that the authorities should not conduct detailed inquiries into the nature of transactions at the stage of issuing 'C' forms. Respondents' Arguments: The respondents argued that the online facility for obtaining 'C' forms was disabled by a circular dated August 17, 2020, requiring manual applications. They also claimed the Petitioner failed to provide lorry receipts to establish inter-state movement of goods.
Sections Cited
Section 8, Section 8(3), Section 8(4), Rule 12(1)
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
The Court made the following: ORDER i I I I
TH 1 HON'BLE THE CHIEF JUSTICE T]JJAI IIHUYAN AND THi' HON'BLE SRI JUSTICE N. TUKAR4.]1,IJI WRIT PETITION No.3895O of 20'.22 ORDER: lt zr t)'Le Itotl'bta rtle ('tLrcl .tusut,. Lijtat Bhrltan) Hea'cl Mr. S. R. R.Visu.anath, Iearned c:r-rnsel for the petitroner and Mr. I(.Raji Reddy, learnt:d S< n ior Standing Counsel f, rr Commercial Ta-x lor the responderLis.
By "iling this petition under Article 22o of th.e Constitllti )n of lndia, petitioner has priryed for the follor.r,ing r eliel's il A r.r'rit, order or dircction one morc in tire nature of mandamus directing tht: responclent atrthoritics to issue to the petitioners l7 'C' declaration forms prescribed by sub-se,:r,rons (3) & (a) of section 8 of the Central Sales 'lr:x i\ct, 1956 ard sub-rules (1) & (6) of }iule r 1) of the Central Sa-les'l'ax (R&1') Rulcs, 1957 and Rule 9 of the Central Sales Tax (Teiangana) Rules, 1!)57 forthwith within certain specified tirne: at tl direct the respondent authorities t() pay hc costs of this petition; and pass such other order or orders as are dt r:rned ht and proper in the facts and circumstanc,:s o[ rhe case and do justice. 1i) iii) I ) I I I I I
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Thus, sum ancl substance of petitioner,s praver is issuarrce of lZ ,C, forms in terms of sub-sections (3) and (a) of Section 8 of the Central Sales Tax Act, 1956, and sub_ rules (1) and (6) ol Rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957. 4. Petitioner is a limited company registered under the provisions of the Companies Act, 1956. It carries on the business of infrastructure development including construction of highways, expressways, bridges, flyovers etc. It is a registered dealer under the Telangana Value Added Tax Act, 2005, as well as under the Central Sales Tax Act, 1956. Foliowing enactment of the Central Goods and Services Tax Act, 2OlZ, with effect from O|.OZ.2O!Z, ushering in the Goods and Services Tax (GST) regime, petitioner has migrated to GST.
For the financial years 2016_12 and 2OIZ_1g (from 01.O4.2O17 to 3O.06.2017) petitioner had executed several projects in the State of Teiangana. For such execution, it had procured goods both from within the State of Telangana as well as from outside the State of fetanganaj
For the tloods procured fronr other states, pelitioner is entitled tr concessional rate of tax at 2,'/o in tcrnrs of sub- section (3 of Section B ol the Central Sales.-ax l.ct, 1956, subject tc furnishing of ,C, declaration lorrr s in terms of sub-section (4) of Section g of the Central liales Tax Act, 1956, read with Rule l2(1) of the Centrat Sales Tax (Registrati, rn and Turnover) Rules, 1957. 5. i. Grier ance of the petitioner is that rlespii e payment of laxes on r,:gular basis and there being r)o arrear tax due, respondent s clid not issue the ,C, declaration forms. Petitioner had furnished proof of inter_state sale and transport < f goods. Aggrieved, present writ petition has been filed s:eking the reliefs as indicated abovt..
On 2).1O.2O22, this Court had directt:d learned Senior Star ding Counsel to obtain instructior.: s as to why 'C' lorms w:re not being issued to the petitioner though according tr the petitioner there are no arreari anrr it has been filing r :gular returns under the statute.
Respor dent No.l ( ( has filed counter affida r.it t:rrough Mr. V.Srin.vasa Reddy, Joint Comrnissi rner (ST), I I
-j Hyderabad Rural Division. It is submitted that till issuance of circular b1' the Commissioner of Commercial Taxes dated 17.08.2020, facility to obtain the 'C' forms from the portal was open and it w'as accessible to every dealer. Writ petition:r did not choose to issue the 'C'forms to their inter-state sellers. By the circular dated |7.OB.2O2O, it is stated that suflicient caution has to be exercised in allowing the dealer to obtain the 'C'forms from the portal. All logins to access'C'forms by the dealer have been disabled. If any dealer requires 'C' forms, he has to apply to the juri ictional officer and the same shall be forwarded to the Commissioner of Commercial Taxes by following the instructions issued therein. 7 .
The online facility was withdrawn after a lapse of more than three years, vt'hereafter petitioner approached the juri ictional authority for issuance of 'C' forms when COVID-19 pandemic was at its peak. Answering respondent has stated that the above circular dated 17.O8.2O2O is binding on him. Writ petitioner did not file the lorry receipts (LR) issued by the transporter to establish inter-state movement of goods. )
B. On clue consideration, we are of t rr: r,icr,r, that explanatior gtven by respondent No.1 is no: adr:quate to cleny 'C' fc rms to the petitioner. There is n() lllegation of short deposit of any taxes by the l)€.titioner or suppressic n/ misstatement of goods wt ile availing concession al rilte of tax.
That apart, issue raised in the u,rit pe.litic,n is no longer res integra. A Division Bench of tis Oourt in A.P.Gas Power Corporation Ltd. v. Assistant Commercirl Tax Oflicerr has held that at the stage of issuance o1 'C' declaration form, the notifiecl luthority is not require,l to conduct an enquiry into the r ature oI- the transaction as to whether the petitioner neec s the forms for use in tl e course of inter_state trade or for ;r,oicance of payment of tax which he would be liable tc pal.. The authorities ,vill, however, be at liberty to makt, such an enquiry as ir is necessary to see whether the .c fornrs have been proper y issued and if not what is the riability of the parties und€r the erstwhile Andhra pradesh Gtneral Sales .,Tax Act, 191 7, or the Central Sales Tax Act, I )1t6, as the I I \ J '1toos1 too s'IC 62s (Ap)
6 case may be. Such an enquiry need not be made at the stage of issuance of 'C' form. Al1 that is required to be examined at that stage as contemplated under Rule 9 of the Central Sa-les Tax (Registration and Turnover) Rules, 1957, is whether the person rvho had applied for 'C'form is a registered dealer; whether the goods in respect of which 'C' form is used are included in the certificate of registration; and whether such a person has paid the amount for the 'C'form and produced necessary challan in proof of the payment. Even such a requirement, it is submitted, has since been dispensed with.
The aforesaid decision of this Court has been followed by various High Courts. Recently, the High Court of Jharkhand in Tata Steel Limited v. State of Jharkhandz has held that once a dealer satisfies the conditions that he is a registered dealer authorised to purchase goods mentioned in the certificate of registration and charges for obtaining 'C' forms have been paid, the authorities are bound to issue him the 'C'forms. ) ) '?2018 SCC Online Jhar 1741
1 To, 1 1. Con ;eqrrentlv and in the light of t|re al,o,,e, r,.,e direct 'rhe respot rcients to issue the 17 ,C, forrrrs to :ltc petitioner Ior tlre pe riod 2016-17 and 2017-la (f:orn J I"0.1.2017 to 110.06.201 7) u'ithin a period of fifteen days frorrr r11e dare of reccipt of r copy oI this order.
This dlsposes of the writ petition. Misc:llaneous applications pendrng, il anv, shall stand clos :d. However, there shall be no ordr r. as to costs . L. SIVA PARVATHI ASSISTAhIT REGIS/RAR ,/I ; SEC;TION OFFICER The Joint Cor rmissioner of State Tax, Hyderabad Rural Divisirtn, 4th Floor, East Wing, G lgan Vihar Complex, Opp. Gandhi Bhavan, I,Jan,pally, Hyderabad. The Deputy C ommissioner (ST) STU 1, Hyderabad RunLl Divt:;ron, 4th Floor, East Wing, G rgan Vihar Complex, Opp. Gandhi Bhavan, l.lampally, Hyderabad- The Assistanl commissioner (ST), (Earlier known as co,rner,:ial rax officer) Madhapur-1 c ircle, Manoranjbn Complex, M4 Block, Bhe q,,,s Nlagar Society Colony, Naml ally, Hyderabad, Telangana 500001 The Commiss oner of Commercial Taxes, Sth Floor, Conl-rrercial Taxes Complex, Op1 . Gandhi Bhavan, Nampally, Hyderabad. The Principal iecretary, Revenue, (CT) State of Telangz rr;,r, S,:cretariat, Saifabad, Hyc erabad. One CC to SF I S.R.R. VISWANATH, Advocate tOpUCl One CC to K. RAJI REDDY (SC FOR COTVMERCTAL TAX) [OtrUC] Two CCs to G P FOR COMMERCTAL TAX, High Court fo" |re {jtate of Telangana at lyderabad [OUT] Two CD Copir s 1 2 4 5 6 7 B t 1 3
BB GJP I I
HIGH COURT DATED: 0211t112023 ORDER W.P.No.389li0 of 2022 DISPOSING OF THE WRIT PETITION WITHOUT CI)STS e$ Co I -/,., 4r 9,E STATE $ \ ttB ?$8 fi :.:. S Pi\T @t"? ? \ \ iI I a l fu-< -n\ov'
Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.