Paradeep Phosphates Ltd. Vs Odisha Sales Tax Tribunal (Orissa High Court)
The Orissa High Court disposed of a writ petition challenging two interlocutory orders of the Odisha Sales Tax Tribunal (OSTT). The petitioner questioned the Tribunal’s refusal to adjudicate the jurisdictional challenge to an assessment framed under Section 10 of the Odisha Entry Tax Act, 1999 (OET Act) during the pendency of proceedings concerning exemption under a scheme approved by the erstwhile Board for Industrial and Financial Reconstruction (BIFR). The petitioner also challenged the Tribunal’s subsequent refusal to recall the interlocutory order on the ground that it lacked the power of review.
The petitioner had been assessed to entry tax under Section 10 of the OET Act. Although the first appellate authority set aside the assessment and directed a fresh assessment, the petitioner filed a second appeal before the OSTT. During the hearing, the petitioner raised an additional ground challenging the jurisdiction of the assessing authority to invoke Section 10. The Tribunal, however, deferred consideration of that issue until the proceedings before the NCLAT concerning the petitioner’s entitlement to entry tax exemption under the BIFR-approved scheme were decided.
The petitioner submitted that the BIFR had sanctioned a scheme granting exemption from entry tax for a specified period and that the subsequent denial of the benefit by the State authorities led to further proceedings before the BIFR, which were later transferred to the NCLT following repeal of the Sick Industrial Companies (Special Provisions) Act, 1985. After the NCLT declined relief, the matter was carried in appeal before the NCLAT. According to the petitioner, the issue of exemption related to the merits of the tax demand, whereas the jurisdiction of the assessing authority under Section 10 constituted a preliminary issue that ought to have been independently decided by the OSTT. The petitioner relied on earlier judicial precedents to contend that the Tribunal should have adjudicated the jurisdictional challenge instead of postponing it pending the NCLAT proceedings.
