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2009 Supreme(SC) 595
Supreme Court of India
THE HONOURABLE MR. JUSTICE S.H. KAPADIA & THE HONOURABLE MR. JUSTICE AFTAB ALAM
M/s. Ambica Steels Ltd.
Versus
State Of U.P. & Others
CIVIL APPEAL NO.4970 OF 2008
Decided on : 31-03-2009
A one-time waiver of penalty and interest may be granted during re-assessment if the assessee submits Form 'F', particularly when interpretations of Section 6A of the Central Sales Tax Act, 1956, vary. Assessments should be decided on merits if forms are unavailable due to state policies.
Headnote:(A) Central Sales Tax Act, 1956 - Section 6A - Re-assessment proceedings - Submission of Form "F" - Waiver of penalty and interest - Due to differences of opinion between various tax authorities on the scope and applicability of the section, one-time waiver of penalty and interest is granted subject to the furnishing of the required forms within the prescribed period.
(B) Refund of deposit - Sum deposited under protest is to be refunded within a specific timeframe after the completion of re-assessment proceedings, subject to adjustment against the duty assessed.
(C) Non-issuance of Form "F" by certain States - In cases where the transferee's state does not issue the required forms, the Assessing Officer shall complete re-assessment on merits, considering that the assessee is not at fault for the inability to obtain the form.
Facts of the case:
The assessee agreed to submit to re-assessment proceedings and file Form "F" within ten weeks. A sum of one crore rupees had been deposited under protest. The court was tasked with scheduling the re-assessment and determining the treatment of penalties and deposits.
Findings of Court:
The Assessing Officer is directed to complete the re-assessment within three months after the expiry of the ten-week period for filing forms. Penalty and interest are waived as a one-time measure, and the amount deposited under protest is to be refunded after adjustment of the assessed duty.
Issues: The primary issues were the timeline for re-assessment, the applicability of penalties despite conflicting interpretations of Section 6A, and the procedure for assessment when the required forms are not issued by the concerned state.
Ratio Decidendi: When there is a difference of opinion among tax authorities regarding the scope of a provision (Section 6A), a one-time waiver of penalty and interest can be provided if the assessee complies with the documentation requirements. Furthermore, if the required form is unavailable due to reasons beyond the assessee's control, the assessment must be based on the merits of the transaction.
Result: Civil appeal disposed of.
Legal Category Hierarchy
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tax law
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central sales tax
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re-assessment proceedings
- waiver of penalty and interest
- form f
- section 6a interpretation
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re-assessment proceedings
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central sales tax
Judgment :-
Shri Sorabjee, learned senior counsel appearing on behalf of the assessee, on instructions, states that the appellant - assessee will submit itself to the re-assessment proceedings initiated vide Show Cause Notice (see Annexure P-2). He further states that the assessee will file Form "F" with the Authority concerned within ten weeks from today.
On expiry of the period of ten weeks the Assessing Officer will take up re- assessment proceedings which will be completed within a period of three months, thereafter.
At this stage, it may be mentioned that on the scope and applicability of Section 6A of the Central Sales Tax Act, 1956, there exists difference of opinion between the various Sales Tax Collectors in the country and therefore since the Appellant is now ready to file Form "F", we are directing the Assessing Officer not to impose penalty/interest, in the re-assessment proceedings as one time waiver. Needless to add that waiver of penalty and interest shall be admissible only on Form "F" being furnished by the assessee within the prescribed period.
The appellant has deposited a sum of Rs.1,00,00,000/- (one crore) on 27th December, 2008, under protest vide letter of even date. It is made clear that the said amount shall be refunded to the assessee herein within a period of two weeks after the completion of re-assessment proceedings, subject to adjustment, if any, in the Duty assessed.
We are informed that certain State(s) within whose jurisdiction the transferee is located is/are not issuing "F" Forms. In such an eventuality it would be open to the Assessing Officer to complete re-assessment proceedings on its own merits after examining the transaction between the parties, keeping in mind the circumstance that the assessee is not in a position to obtain the "F" Form, for no fault of his.
Accordingly, this civil with no order as to costs.
