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Gujarat High Court · body

2017 DIGILAW 953 (GUJ)

State of Gujarat v. Shyam Industries

2017-05-03

B.N.KARIA, M.R.SHAH

body2017
JUDGMENT : M.R. Shah, J. 1. As common question of law and facts arise in these appeals and Special Civil Application No. 7278 of 2017 has been preferred by the dealer for appropriate writ, direction and order directing the respondent State Authority to implement the common judgment and order passed by the learned Tribunal impugned in the Tax Appeal No. 288 of 2017 and 289 of 2017, all these appeals and Special Civil Application are heard, decided and disposed of by this common judgment and order. 2. Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the learned Gujarat Value Added Tax Tribunal, Ahmedabad dated 5.11.2015 passed in Second Appeal Nos. 707 & 708 of 2015, by which, the learned Tribunal has allowed the said appeals preferred by the respondent dealer and has quashed and set aside the orders passed by the authority below cancelling the registration and/or confirming such order and has directed to restore the registrations to the dealer both under the Gujarat VAT Act as well as CST Act, the State has preferred present Tax Appeal Nos. 288 of 2017 and 289 of 2017 with the following proposed question of law. "Whether under the facts and circumstance, the learned Tribunal erred in deciding the registration certificate of the respondent were to be restored ? 3. As despite more than one year had passed, the judgment and order passed by the learned Tribunal passed in Second Appeal Nos. 707 and 708 of 2015, were not complied with by the State and the registrations under the VAT Act and CST Act of the dealer were not restored, the dealer has preferred Special Civil Application No. 7278 of 2017. 4. The facts leading to the present appeals in nutshell are as under: 4.1. That the respondent in the appeals - original appellant (hereinafter referred to as the dealer) was registered under the Gujarat Value Added Tax Act, 2003 as well as under the Central Sales Tax Act, 1956. That the dealer was engaged in the business of trading in chemicals, dyes, fertilizers etc. That the registered premises of the dealer was situated at 149, Mithi Rohar, GIDC, Gandhidham, That the dealer change his business premises and additional place of business situated at plot Nos. 2 and 3 Survey No. 350-A, Mithi Rohar, Gandhidham, Kutch. That the dealer was engaged in the business of trading in chemicals, dyes, fertilizers etc. That the registered premises of the dealer was situated at 149, Mithi Rohar, GIDC, Gandhidham, That the dealer change his business premises and additional place of business situated at plot Nos. 2 and 3 Survey No. 350-A, Mithi Rohar, Gandhidham, Kutch. According to the dealer, the dealer filed on-line application for amendment of Registration Certificate on 22.2.2014 whereby the additional place of business was incorporated. That the dealer failed to file the returns for the period from April 2014 to March 2015 at Gandhidham. That the AO called upon the Dealer to show cause as to why the registration may not cancelled in exercise of powers conferred under Section 27(5)(g) of the VAT Act. It appears that the notice was sent at the original address which was found to be closed and therefore, the notice was affixed at the original address. That the Commercial Tax Officers (5), Gandhidham vide order dated 08.04.2015 canceled the registration certificate of the dealer both under the VAT Act as well as Central Sales Tax Act solely on the ground that the dealer has not filed returns for three consecutive period i.e. April 2014 to March 2015. 4.2. Feeling aggrieved and dissatisfied with the order passed by the Commercial Tax Officer (5), Gandhidham dated 08.04.2015, the dealer preferred appeal before the Deputy Commissioner (First Appellate Authority). That the First Appellate Authority dismissed the said appeal on altogether other grounds. At this stage, it is required to be noted that in the meantime, the dealer paid unpaid tax of Rs. 21.930/- and interest of Rs. 2812/- for the period from April 2014 to March 2015 and also paid penalty of Rs. 8000/- towards non filing of the returns for the April 2014 to March 2015. Despite the above, on other extraneous grounds the First Appellate Authority dismissed the appeals and did not restore the registrations. 4.3. Feeling aggrieved and dissatisfied with the orders passed by the First Appellate Authority dismissing the appeal, the dealer preferred Second Appeal Nos. 8000/- towards non filing of the returns for the April 2014 to March 2015. Despite the above, on other extraneous grounds the First Appellate Authority dismissed the appeals and did not restore the registrations. 4.3. Feeling aggrieved and dissatisfied with the orders passed by the First Appellate Authority dismissing the appeal, the dealer preferred Second Appeal Nos. 707 of 2015 and 708 of 2015 before the learned Tribunal and by impugned judgment and order, learned Tribunal has allowed the said appeals and has quashed and set aside the orders canceling the registration certificate and has directed to restore the registrations certificate both under the Gujarat VAT Act as well as CST Act. 4.4. Feeling aggrieved and dissatisfied with the order passed by the learned Tribunal, the State has preferred present Tax Appeals with aforesaid proposed question of law. 5. Shri Chintan Dave, learned Assistant Government Pleader has vehemently submitted that in the facts and circumstances of the case, the learned Tribunal has materially erred in allowing the appeals and directing to restore the registrations of the dealer under the VAT Act as well as CST Act. It is vehemently submitted by Shri Dave, learned Assistant Government Pleader appearing on behalf of the State that the learned Tribunal has materially erred in not properly appreciating the fact that as such the registrations were cancelled under Section 27(5)(g) of the VAT Act as the dealer did not file the returns for three consecutive period i.e. April 2014 to March 2015. 5.1. It is vehemently submitted by Shri Dave, learned AGP that solely because subsequently the assessee filed the returns on payment of penalty, the learned Tribunal was not justified in quashing and setting aside the orders passed by the adjudicating authority cancelling the registrations. 5.2. It is vehemently submitted that as such even the assessee closed the business from the premises which was registered and therefore, the dealer was required to be served with the notice and the order by affixing the notice/order. Therefore, it is requested to admit/allow the present Appeals. 6. Both these appeals are vehemently opposed by Shri Dhaval D Vyas, learned advocate for the dealer. 6.1. It is vehemently submitted by Shri Vyas, learned advocate for the dealer that admittedly the registrations were cancelled by the adjudicating authority solely on the ground that the dealer did not file the returns for three consecutive period. 6. Both these appeals are vehemently opposed by Shri Dhaval D Vyas, learned advocate for the dealer. 6.1. It is vehemently submitted by Shri Vyas, learned advocate for the dealer that admittedly the registrations were cancelled by the adjudicating authority solely on the ground that the dealer did not file the returns for three consecutive period. It is submitted that as such dealer already intimating the department about change of premises. However, the department tried to serve notice at the old address. It is submitted that even thereafter the dealer file returns for the period between April 2014 to March 2015 on payment of penalty of Rs. 8000/- and also paid the tax with interest. 6.2. It is submitted that however the First Appellate Authority on altogether extraneous ground did not restore the registrations. It is submitted that the First Appellate Authority dismissed the appeals and did not restore the registrations on the ground, which were not even raised and/or considered by the original adjudicating authority. 6.3. It is submitted that therefore, in the facts and circumstances of the case, the learned Tribunal has not committed any error in allowing the appeals preferred by the dealer and directing to restore the registrations. 7. Heard the learned advocates for the respective parties at length. At the outset, it is required to be noted and it is not in dispute that the adjudicating authority cancelled the registrations under the Gujarat VAT Act as well as CST Act under Section 27(5) (g) of the VAT Act on the ground that dealer did not file returns for three consecutive period i.e. April 2014 to March 2015. It appears that thereafter subsequently and having been served with the order cancelling the registrations, the dealer filed the returns along with penalty of Rs. 8000/- and also paid the tax with interest. It appears that there was some criminal case pending against the dealer and their consultant and therefore, he could not consult with the consultant/practitioner and therefore, dealer could not file the return. However, the facts remain that the dealer filed returns and also paid the penalty. The dealer also paid the tax with interest. Nothing adverse to the dealer was found except non filing of the returns for the period between April 2014 to March 2015. There are no allegation against with respect to either evasion of duty and/or other allegations. However, the facts remain that the dealer filed returns and also paid the penalty. The dealer also paid the tax with interest. Nothing adverse to the dealer was found except non filing of the returns for the period between April 2014 to March 2015. There are no allegation against with respect to either evasion of duty and/or other allegations. Despite the above, the First Appellate Authority dismissed the appeals and did not restore the registration on other extraneous grounds which were not even considered by the adjudicating authority. Considering the aforesaid facts and circumstances and making observations in para 14, the learned Tribunal has allowed the appeals and has directed to restore the registrations. Para 14 reads as under: "(14) We have considered the rival submissions and the facts of the case. We have also gone through the orders passed by the authorities below and the documents produced before this Tribunal. We have further taken into consideration the relevant statutory provisions and the decided case law on the subject. The facts pleaded before this Tribunal clearly revealed that no notice was issued and or served to the appellant prior to the cancellation of registration. The order of cancellation of registration also does not seem to have been served on the appellant. An attempt was made by the Department to serve the order by affixation. However, it was no affixed at the additional place of business of the appellant, in spite of the fact that such additional place of business was duly informed to the Department way back in February, 2014 and the order of cancellation of registration was passed on 8/4/2015. The registration was cancelled admittedly on the ground of non-filing of three consecutive returns. The appellant has made good the said default and paid tax, interest and penalty. Thus, there was no reason for the learned Deputy Commissioner to deny the restoration of registration to the appellant. However, only with a view to deny the restoration of registration and confirm the order of cancellation of registration, the learned Deputy Commissioner has relied on certain extraneous circumstances and since certain criminal cases were filed against the appellant, he has refused to restore the registration to the appellant. Thus, the main default on which the registration was cancelled, was kept aside by the learned Deputy Commissioner, as the said default was already cured by the Department. Thus, the main default on which the registration was cancelled, was kept aside by the learned Deputy Commissioner, as the said default was already cured by the Department. He has however, pressed into service certain new issues, while deciding the First Appeals, which are beyond the scope of this registration and in any case it was no the subject matter of appeals." 7.1. Considering the aforesaid facts and circumstances of the case, it cannot be said that the learned Tribunal has committed any error which calls for the interference of this Court. No substantial question of law arise as sought to be contended on behalf of the State. 8. In view of the above and for the reasons stated above, both the appeals deserve to be dismissed and are accordingly dismissed. In view of dismissal of appeals, Civil Applications also stand dismissed. 9. Now, so far as Special Civil Application No. 7278 of 2017 is concerned, it is filed by the dealer for appropriate writ, direction and order directing the department to comply with the judgment and order passed by the learned Tribunal passed in Second Appeal Nos. 707 & 708 of 2015 and to restore the registrations. As the common judgment and order passed by the learned Tribunal passed in Second Appeal Nos. 707 & 708 of 2015 is now confirmed, the State is required to comply with the same and restore the registrations both under the VAT as well as CST Act. Under the circumstances, while disposing of the Special Civil Application No. 7278 of 2017 respondents are hereby directed now to comply with the judgment and order passed by the learned Tribunal passed in Second Appeal Nos. 707 & 708 of 2015 and restore the registrations of the appellant both under the VAT as well as CST Act within a period of three weeks from today. With this, present Special Civil Application also stands disposed of.