HINDUSTAN UNILEVER LIMITED Vs. STATE OF UTTARAKHAND

JUDGEMENT

(1.) The Special Appeals, three in number, being inter-connected, we are disposing of the same by this common judgment.

(2.) Special Appeal No. 159 of 2015 arises from the judgment passed in Writ Petition (MS) No. 532 of 2013. It relates to Assessment Year 2008- 2009. Special Appeal No. 160 of 2015 arises from the judgment passed in Writ Petition (MS) No. 1526 of 2014. It relates to Assessment Year 2009-2010. Special Appeal No. 161 of 2015 arises from the judgment passed in Writ Petition (MS) No. 2282 of 2014. It pertains to Assessment Year 2010-2011. The appellant is the writ petitioner in all the three writ petitions. We are treating Writ Petition (MS) No. 532 of 2013 as the leading case.

(3.) The appellant Company, which has manufacturing unit in the State of Uttarakhand, purchases raw material and packing material for manufacture of soaps, detergents, creams and tooth-pastes. Towards the manufacture of the aforesaid products, it purchases raw material and packing material in the State of Uttarakhand. The Uttarakhand Value Added Tax Act, 2005 (hereinafter referred to as the "Act") provides for Input Tax Credit (hereinafter referred to as "ITC"). The complaint in the writ petitions relate, essentially, to refusal to grant ITC in respect of packing materials purchased from within the State of Uttarakhand used in the manufacture of the products of the appellant, which products are, thereafter, transferred by way of stock transfer to outside the State of Uttarakhand. It is the case of the appellant that, after the Act came into force in 2005, assessments were completed for the years 2005-2006, 2006-2007 and 2007-2008, wherein returns were finalized, which countenanced grant of ITC in respect of packing materials of products, which were sent outside the State by way of stock transfer. A Circular was issued on 28.06.2008, which, according to the appellant, is issued under Rule 4 of the Uttarakhand Value Added Tax Rules, 2005 (hereinafter referred to as the "Rules"). The appellant understood from the Circular that ITC is available in respect of packing materials used for finished products, which are stock transferred and, accordingly, it arranged its affairs. It is, while so, that in relation to Assessment Year 2008-2009, which assessment proceedings took place in the year 2012, the officer purported to disallow the claim for ITC on packing materials.