Ms Atibir Industries Company Limited Thr One Of Its Director Sri Sandeep Kumar Sarawgi vs. The State Of Jharkhand

Held

The High Court disposed of the writ application by directing the petitioner to appear before the Deputy Commissioner of Commercial Taxes (DCCT), Giridih Circle, with all relevant documents within one month from the date of the order. The Court further directed the DCCT to decide the petitioner's claim within two months thereafter, ensuring that the petitioner is granted a hearing as previously directed by the Commissioner of Commercial Taxes. The DCCT was also instructed to consider any precedents cited by the petitioner. The Court did not decide on the merits of the ITC claim itself but focused on facilitating the procedural progression of the case. The specific provision under which the ITC was disallowed or the grounds for its withdrawal were not explicitly discussed or decided upon by the High Court in this order.

Facts

The petitioner, M/s. Atibir Industries Company Limited, was initially allowed input tax credit (ITC) amounting to Rs. 1,80,15,166. However, the Assessing Authority subsequently withdrew this allowance, stating that the ITC was claimed on goods not directly involved in the manufacturing process. The petitioner filed a revision before the Commissioner of Commercial Taxes, who, by an order dated 23.12.2014, remanded the matter back to the Deputy Commissioner of Commercial Taxes (DCCT), Giridih Circle, for a decision on merits by 26.02.2015, after granting the petitioner an opportunity to be heard. The petitioner's grievance is that no final order has been passed since then, and the matter remains pending. The State contended that the petitioner has been evading appearance and production of relevant documents despite being asked by the DCCT.

Key Issues

1. Whether the withdrawal of input tax credit (ITC) by the Assessing Authority was justified, considering the petitioner's claim that the goods were directly involved in the manufacturing process? (Question of fact and law). Petitioner's contention: The petitioner argues that the ITC was legitimately claimed on goods used in the manufacturing process and that the subsequent withdrawal by the Assessing Authority was erroneous. The petitioner also highlights the inordinate delay in the final decision after the remand order by the Commissioner. Revenue's contention: The respondent State argues that the petitioner is evading the process by not appearing before the DCCT and not producing the required documents, which is why the matter is pending. The State implies that the petitioner's failure to cooperate is the reason for the delay in adjudication.