Vijay Nirman Co. Pvt. Ltd Vs State of Assam And 3 Ors. (Gauhati High Court)
In a case brought before the Gauhati High Court, the court quashed a Central Sales Tax (CST) demand against Vijay Nirman Co. Pvt. Ltd., ruling that the demand was based on a previously invalidated circular. The petition, Vijay Nirman Co. Pvt. Ltd. vs. State of Assam, challenged a demand from Indian Oil Corporation Ltd. (IOCL), which denied the company the concessional tax rate on the sale of certain goods by refusing to issue a statutory ‘C’ Form. This denial was a direct consequence of Circular No. 7/2017, issued by the Commissioner of State Tax, Assam.
Vijay Nirman Co. Pvt. Ltd., a registered dealer under the Central Sales Tax Act, argued that the circular was contrary to law. The company contended that because the circular was the basis for the denial of the ‘C’ Form and the subsequent demand for differential tax by IOCL, both actions were invalid.
During the proceedings, it was brought to the court’s attention that the very circular in question (Circular No. 7/2017) had already been set aside by a co-ordinate bench of the same court. The judicial precedent cited was the case of Star Cement Meghalaya Vs. State of Assam & Ors., where the court’s order dated September 4, 2018, invalidated the circular. Following this ruling, the Commissioner of State Tax, Assam, had issued a new circular (Circular No. 12/2018-GST) on August 9, 2018. The new circular provided guidance on the issuance of ‘C’ Forms for the concessional tax rate, linking it to the use of six specific commodities in sectors such as telecommunication, mining, and power generation.
