M/S. BATEMAN ENGINEERING (INDIA) PVT. LTD., AT/P.O./P.S. JODA, DIST: KEONJHAR, REPRESENTED THROUGH ITS MANAGING DIRECTOR MR. MATTHYS DANIEL JOHANNES GREEFF Vs. STATE OF ORISSA AND OTHERS

JUDGEMENT

(1.) In the present writ petition though several reliefs have been prayed for, Mr. S.C. Lal, learned Senior Advocate appearing on behalf of the petitioner has confined his argument to the following three reliefs:

(2.) The petitioner's case in a nutshell is that the petitioner company is a registered dealer under the OVAT Act carrying on the business of works contract at Joda. It has entered into an agreement with M/s. TATA Steel Ltd., (for short, 'TATA') for carrying out the works contract of material handling system for handling iron ore dispatch for 6.8 and 10 MTPA expansion at Joda Iron Ore Mines. The petitioner company as per agreement in certification of TATA had procured plants and machinery by way of purchase in course of interstate trade and commerce from outside States on payment of Central Sales Tax. While the said goods were in course of transit, the petitioner sold the said goods to TATA on the basis of transfer of documents under Section 6(2) of the Central Sales Tax Act, 1956 (for short, 'CST Act'). As per the requirement of Section 6(2) of the CST Act, the purchasing dealer i.e. TATA is obliged to furnish the declaration forms 'C' to the petitioner so that the petitioner can avail the tax exemption for the said subsequent sale effected by it to TATA. As per Rule 7 of the CST (O) Rules, the petitioner is mandatorily required to submit its quarterly return in Form-I showing the tax payable for the sales effected in course of inter-state trade and commerce and transactions done under Sections 3, 5, 6A and 8 of the CST Act during such quarter. As per Rule 7A, the petitioner is supposed to enclose the declaration forms along with the return. The petitioner had submitted its quarterly returns for the Quarters March, June and September 2010 on 16.11.2010 before opposite party No.3, but while submitting the returns, the petitioner could not submit the declaration form 'C' as the purchaser i.e. TATA had not handed over the said declarations form to the petitioner. On receiving the returns, opposite party No.3 sent three notices in Form II-B dated 11.03.2011 for the aforesaid three quarters calling upon the petitioner to furnish the wanting declaration forms/certificates by 11.04.2011. On 11.04.2011, the petitioner sought for an adjournment for submitting the wanting declaration forms. The case was fixed to 17.04.2011 by opposite party No.3. Subsequently, time was granted till 20.04.2011. On 20.04.2011, the representative of the petitioner submitted a reply to the show cause notice stating therein that 'C' forms had not been collected and the same would be produced before the audit assessment is taken up. Opposite party No.3 had rejected the petition dated 20.04.2011 and passed provisional assessment orders on the same day, i.e., 20.04.2011 under Rule 12(1)(b) of the said Rules under Annexure-3 series raising a tax demand of Rs.1,29,59,491/- for the quarters of the year 2010-2011. Subsequent to the demand raised on the basis of the provisional assessment orders, opposite party No.3 has issued notice (Annexure-5) under Section 51 of the OVAT Act for realization of the tax demanded under Annexure-3 series. Hence, the present writ petition.

(3.) Mr. S.C. Lal, learned Senior Advocate appearing on behalf of the petitioner submits that due to non-supply of 'C' declaration forms by opposite party No.3 to TATA, who in turn was to give the same to the petitioner, the petitioner could not furnish the 'C' Forms. Thus, opposite party no.3 was fully aware of the fact that he had not supplied 'C' forms to TATA, as a result of which TATA was not able to supply the said forms to the petitioner. It is submitted that without giving sufficient opportunity to the petitioner in terms of language and spirit of proviso to Rule 12(1)(b) of CST (O) Rules opposite party no.3 has rejected the petitioner's application dated 20.04.2011 filed before him seeking time till taking up the audit assessment for production of 'C' forms. The aforesaid conduct of opposite party No.3 smacks of mala fides. The Assessing Authority arbitrarily completed the provisional assessment and raised huge tax demand hurriedly even though no time limit is provided in the Statute for passing provisional order of assessment. After completion of the provisional assessment, opposite party No.3 had issued 'C' declaration forms to TATA on 02.07.2011 and in turn TATA had handed over the 'C' forms covering the transactions of subsequent sale under Section 6(2) to the petitioner. The petitioner, thereafter, submitted the said 'C' forms before opposite party No.3 on 16.07.2011. Thus, the petitioner has submitted all the 'C' forms as pointed out by opposite party No.3 in the Notice in Form II-B under Annexure-1 series. Thus, there was sufficient cause which prevented the petitioner from producing the 'C' forms along with the return. Opposite party No.3 has acted in a most arbitrary manner and in haste. The action of the Assessing Officer is against the rules of fair play and principles of natural justice. In the meantime, the required 'C' forms having been filed for the quarters March, June and September, 2010 before the Assessing Authority, there would not be any liability to pay central sales tax and therefore, the provisional orders of assessment passed under Annexure-3 series are liable to be quashed.