Hindustan Equipment Pvt. Ltd Vs State of M.P (Madhya Pradesh High Court)
In a significant ruling for taxpayers, the Madhya Pradesh High Court has determined that companies with appeals pending before an appellate authority are eligible for a 50% relief under the Madhya Pradesh Karadhan Adhiniyamon Ki Puranee Bakaya Rashi Ka Samadhan Adhyadesh, 2020 (the Ordinance), even if the initial tax demand stemmed from issues related to statutory certificates. The judgment, delivered in the case of Hindustan Equipment Pvt. Ltd. v. State of M.P., clarifies the interpretation of the Ordinance’s settlement categories, providing relief to businesses facing long-standing tax disputes.
The case involved Hindustan Equipment Pvt. Ltd., an Indore-based manufacturer, whose assessment for the financial year 2012-2013 under the Central Sales Tax Act resulted in an additional demand of ₹20,88,443 due to the non-submission of C-Forms. The company challenged this demand, first by depositing ₹5,24,000 and appealing to the Deputy Commissioner, Commercial Tax, who reduced the demand to ₹10,60,081. Subsequently, Hindustan Equipment Pvt. Ltd. further appealed to the Madhya Pradesh Commercial Tax Appellate Board (MPCTAB), depositing an additional ₹2,12,021. During the pendency of this appeal, the State Government introduced the 2020 Samadhan Ordinance, aiming to settle old outstanding tax arrears.
