C.RAMACHANDRAN Vs. DEPUTY COMMERCIAL TAX OFFICER

JUDGEMENT

(1.) In these Writ Petitions, the Petitioner seeks to quash the order of the Respondent, dated 24.3.2006 made for the assessment years 1997 -1998, 2002 -2003, 1999 -2000, 2000 -2001, 1998 -1999, imposing purchase tax and penalty on the Petitioner.

(2.) The case of the Petitioner is that the Petitioner is running a canteen, on behalf of MFL, in the premises of MFL under the Memorandum of Agreements, dated 26.11.1999 and 12.03.2003. By Notification No.336, dated 17.09.1964, there is an exemption granted for sales in the canteen run under the statutory obligations. As per the agreement, MFL have provided all types of infrastructure facilities for running the canteen. The Petitioner only buys the provisions, cooks and supplies to the MFL employees on subsidise basis. The object of the said notification is not to tax canteens, which are subsidized as a welfare measure. On 22.03.2003, when the Enforcement Officers conducted an inspection, the books of accounts were not made available, though regularly maintained. On receipt of the proposals from the Enforcement Officers, the Respondent issued a notice dated 22.4.2004, proposing to levy purchase tax and penalty and subsequently, the taxes were paid for MFL coupon receipts. Thereafter, further notice dated 20.05.2004 was issued, proposing to levy penalty under Section 12(3)(a) of the TNGST Act, to which, the Petitioner filed their objections, dated 30.05.2004, stating that the purchases were only from the registered dealers and sales tax was not paid, because there was subsidised supply by MFL as a welfare measure and there was no sale to employees and that there was only a catering service. On 28.05.2004, a further reply was given. The Respondent, by another notice dated 07.06.2004, directed the Petitioner to produce the purchase details. The Petitioner appeared before the Respondent and produced all the documents. However, the Respondent, by letter by dated 18.01.2005, called upon MFL to give break -up data of coupon sales and subsidy. The Petitioner submitted an application dated 31.05.2005, requesting to give one more week time for MFL to furnish the break -up details. On 13.06.2005, a peremptory letter was received, in response to which, the Petitioner requested that free issue sales may be taken as coupon sales and the MFL data was adequate to complete a proper assessment. However, the impugned assessment order dated 24.03.2006, calling upon the Petitioner to pay the purchase tax and penalty for the said assessment years. Hence, these Writ Petitions have been filed for the reliefs as stated above.

(3.) This Court, by order dated 21.6.2006 in the above miscellaneous petitions, granted an order of interim of stay on condition that the Petitioner shall deposit a sum of Rs.30,00,000/ - (Rupees Thirty Lakhs Only). Thereafter, the Respondent filed the above miscellaneous petitions to vacate the said interim order and also filed a common counter affidavit, contending as follows: -