Excise And Taxation Commissioner, Haryana vs. M/S Krishna Auto Industries

Held

The Court held that no substantial question of law arose from the Tribunal's order. The Tribunal had correctly relied on the precedent set in M/s Sonex Auto Industries Private Limited, which held that when a unit opts for paying half of the deferred tax upfront, the deferred tax should be calculated without deducting the input tax paid on goods used in manufacturing. Furthermore, the amount of input tax paid by the assessee is to be counted towards the payment of 50 per cent of the deferred tax upfront. The Tribunal's finding that no reasons were assigned by the lower authorities for denying the benefit of 50 per cent tax deferment was also upheld. Consequently, the cases were remanded to the Assessing Authority for fresh decisions, allowing the benefit of tax deferment within permissible limits, calculated on the gross amount of tax before deducting input tax credit. The appeals filed by the appellant-revenue were dismissed.

Facts

The Excise and Taxation Commissioner, Haryana (appellant-revenue) filed an appeal against an order passed by the Haryana Tax Tribunal. The respondent-assessee, M/s Krishna Auto Industries, was granted an exemption certificate for tax deferment under the Haryana Value Added Tax Act, 2003 (HVAT Act). The assessee was entitled to defer tax payment, with one-half of the deferred tax to be paid upfront along with quarterly returns. For the assessment year 2009-10, the Assessing Authority created an additional demand of `90,409/- under the Central Sales Tax Act, 1956 (CST Act). The assessee's appeal to the Joint Excise and Taxation Commissioner (Appeals) was dismissed. The Tribunal, however, allowed the assessee's appeal, setting aside the orders of the authorities below and remanding the case for fresh decision, relying on a previous High Court ruling.

Key Issues

1. What is the amount of deferred tax within the meaning of Section 61(2)(d)(iii) of the HVAT Act, 2003, read with Rule 69 of the Haryana Value Added Tax Rules, 2003? 2. Whether the amount of input tax paid by the assessee can be counted towards the payment of 50 per cent of deferred tax upfront under Section 61(2)(d)(iii) of the HVAT Act, 2003? 3. Whether interest under Section 14(6) of the HVAT Act, 2003 is automatically leviable? The appellant-revenue argued that the learned Tribunal failed to appreciate that the input tax paid by the assessee cannot be counted towards the payment of 50 per cent of deferred tax upfront. The revenue also questioned the automatic leviability of interest. The respondent-assessee contended that the benefit of deferment should be allowed on the gross amount of tax before deducting input tax credit, as held in the case of M/s Sonex Auto Industries Private Limited. The judgment does not record specific arguments from the revenue on the first issue, nor does it explicitly detail the assessee's arguments on the third issue, beyond the Tribunal's findings.