RELIANCE RETAIL LTD. Vs. STATE OF PUNJAB

JUDGEMENT

(1.) The petitioner seeks a declaration that Rule 20 of the Punjab Value Added Tax Rules, 2005 (hereinafter referred to as 'the rules') is ultra vires Section 13(3) of the Punjab Value Added Tax Act, 2005 (hereinafter referred to as 'the Act') insofar as it prescribes the time limit of 90 days for claiming back the Input Tax Credit (ITC) reversed for the goods which have been sent on job work. The petitioner also seeks a writ of certiorari to quash the order dated 6-7-2015 passed by the Punjab Value Added Tax Tribunal dismissing its appeal for the assessment year 2008-09 upholding the levy of tax, interest and penalty.

(2.) The petitioner is a dealer duly registered under the provisions of the Act as well as under the provisions of the Central Sales Tax Act, 1956 at Mohali (Punjab). The petitioner was amalgamated with M/s. Reliance Fresh Ltd. with effect from 1-7-2013 and with effect from 30-7-2013 it changed its name to M/s. Reliance Retail Ltd. The petitioner carries on its business of the manufacturer and sale of jewellery. It is admittedly entitled to Input Tax Credit (ITC) of the tax paid on purchase of gold used in the manufacture of jewellery. The petitioner filed returns for the assessment year 2008-09 in which it claimed ITC in respect of the gold purchased during that year and adjusted the admissible tax credit against its output tax liability and carried forward the balance tax credit to the next year.

(3.) The respondents by a notice dated 29-8-2012 called upon the petitioner to show cause why penalty and interest be not imposed upon it under Sections 56 and 32 of the Act. The notice stated that ITC on purchases amounting to about Rs. 8.23 crores was liable to be rejected as it was not in accordance with Rule 20 read with Section 13(3) of the Act. The petitioner responded to this show cause notice in writing and at the personal hearing. By an assessment order dated 15-11-2012 the respondents imposed tax, penalty and interest aggregating to Rs. 25,80,541/- upon the petitioner. The First Appellate Authority-Deputy Excise and Taxation Commissioner (Appeals) dismissed the appeal by an order dated 14-6-201 The Value Added Tax Tribunal, Punjab dismissed the appeal by an order dated 6-7-2015. The Tribunal noted that during the assessment year 2008-09, the petitioner claimed ITC on purchase of bullion of the value amounting to Rs. 24,57,78,897/-. However, bullion worth Rs. 8,23,326.38 was not received back by the petitioner from the job workers after it was processed and reconditioned within the period of 90 days stipulated in Rule 20 of the said Rules.