JCT LIMITED Vs. STATE OF GUJARAT

JUDGEMENT

(1.) Rule. Ms. Maithili Mehta, learned Assistant Government Pleader, waives service of rule on behalf of the respondents. Having regard to the controversy involved in the present case, which lies in a very narrow compass, the matter is taken up for final hearing today.

(2.) The petitioner is a dealer engaged in the business of manufacture and sale/ purchase of various types of textile products. The petitioner made an application dated July 7, 2006 under section 80(1)(e) of the Gujarat Value Added Tax Act, 2003 (the Act) to the Joint Commissioner of Commercial Tax (Legal), Gujarat for determination of availability of credit of value added tax paid at the rate of four per cent on purchase of raw material within the State of Gujarat. The said application came to be decided vide order dated November 30, 2006 holding that as per the provisions of section 11(3)(b)(i), four per cent would be deducted from the tax credit available to the petitioner and the remaining amount would be admissible as tax credit. No finding was given in relation to inapplicability of section 11(3)(a)(i) of the Act. Being aggrieved, the petitioner preferred an appeal before the Tribunal under section 73 of the Act which came to be dismissed vide order dated May 1, 2007. Against the said order, the petitioner preferred an appeal before the High Court which came to be admitted and is still pending.

(3.) During the pendency of the aforesaid appeal before the High Court, the Assistant Commissioner of Commercial Tax served the petitioner with notices for amount assessed along with assessment orders for the period April 1, 2006 to March 31, 2007 and April 1, 2007 to July 31, 2007 raising demands of Rs. 2,60,50,957 and Rs. 61,42,150, respectively. Aggrieved by the aforesaid orders, the petitioner filed two separate appeals under section 73 of the Act along with stay applications before the first appellate authority, that is, the Deputy Commissioner. Vide order dated July 9, 2010, the Deputy Commissioner of Commercial Tax (Appeals) rejected the stay applications and dismissed both the appeals. Being aggrieved, the petitioner preferred appeals before the Gujarat Value Added Tax Tribunal (the Tribunal) being Appeals Nos. 565 and 566 of 2010 on July 26, 2010 along with stay applications for setting aside the order passed by the Deputy Commissioner of Commercial Tax (Appeals). The Tribunal, after hearing the appeals for admission as well as the stay applications, vide order dated September 6, 2010 directed the petitioner to pay 50 per cent of the total tax dues within a period of three months from the date of the order, that is, an amount of Rs. 1,17,70,107 for assessment year 2006-07 and April 1, 2007 to July 31, 2007. Being aggrieved by the order passed by the Tribunal directing pre-deposit of an amount of Rs. 1,17,70,107, the petitioner has moved the present petition under articles 226 and 227 of the Constitution of India.