SAINT GOBAIN GLASS INDIA LTD Vs. PRINCIPAL SECRETARY/COMMISSIONER OF COMMERCIAL TAXES; DEPUTY COMMISSIONER (CT) LTU IV

JUDGEMENT

(1.) Heard Mr.R.L.Ramani, learned Senior counsel assisted by Mr.B.Raveendran, learned counsel appearing for the petitioner and Mr.Manokaran Sundaram, learned Additional Government Pleader appearing for the respondent and with consent on either side, the Writ Petitions are taken up for final disposal.

(2.) The petitioner is a registered dealer on the file of the second respondent under the provisions of the Tamil Nadu Value Added Tax, 2008, (TNVAT Act) and the Central Sales Tax Act, 1956, (CST Act). The petitioner is engaged in the manufacture of glass and have been filing their monthly returns claiming Input Tax Credit (ITC), in respect of the tax paid on goods purchased within the State of Tamil Nadu. The petitioner were assessed on self assessment basis on the total and taxable turnover and the assessment was completed by the Assistant Commissioner, Sriperumbathur Circle, after which the place of business of the petitioner was audited by the enforcement wing officials on 18.01.2012, from 20.02.2012 to 25.02.2012, 03.05.2012 to 05.05.2012 and 14.05.2012 to 16.05.2012. Based on the report submitted, the second respondent issued notices to the petitioner pointing out several aspects such as dis-allowance of ITC claim of ineligible commodities, dis-allowance of ITC claim on capital goods, reversal of ITC for inter-state sale at higher rate under Section 19(5)(c) of the TNVAT Act, reversal of ITC for interstate sale to SEZ unit against form-I under Section 19 of TNVAT Act, reversal of ITC on breakages under 19(9) of TNVAT Act, reversal of ITC claim on furnace oil used in gen-set, tax on sale of assets tax on fright, which forms part of sale. Apart from the above, the second respondent also proposed to levy penalty under the provisions of the TNVAT Act. The petitioner submitted their objections on 20.02.2015, stating that individual details like name of commodity, invoice number and quantum of ITC had not been given and only some abstract and consolidated figures had been furnished and the petitioner sought for individual details. Further, with regard to the claim for ITC on tube lights and bulbs, batteries etc., the petitioner contended that they are entitled to avail the same, as the manufacturing process cannot be carried on without those commodities. Further, the petitioner's case is that they have not availed ITC on item-wise like ink-toner, paper-hand towel etc., unless, they were furnished those details, they would not be in a position to contest the same. The second respondent after considering the objections given by the petitioner for each of the aspects pointed out in the pre-revision notice, has passed the impugned orders of assessments enhancing the taxable turnover and demanding tax as well as penalty. The orders of assessments are impugned in these Writ Petitions.

(3.) The learned Senior counsel appearing for the petitioner submitted that the revision of assessment was solely based upon the VAT Audit report submitted by the Enforcement Wing officials without conducting any enquiry. Further, the learned counsel elaborately referred to the factual details pointed out by the petitioner in their objections to the pre-revision notice and submitted that the second respondent failed to take note of the definition of input as defined under Section 2(3) of the TNVAT Act, which means any goods including capital goods purchased by a dealer in the course of his business and Section 19(2) of the TNVAT Act, contemplates use of goods as inputs in the manufacture or processing of goods and the electrical goods as well as personal safety equipment have been purchased by the petitioner in the course of business and are absolutely necessary in the factory and therefore, are inputs used in the manufacture of goods. It is further submitted that furnace oil is an important input used in the manufacture of glass and this input has to be kept at a tempature of 1600 :C all throughout the year and this is an input that is used in the manufacture of goods.