Case Law Details
Rockwell Industries Vs Commissioner of Trade & Taxes & Anr. (Delhi High Court)
HC held that it appears to us that in the present case the default assessment order has been generated only to defeat the refund claim of the petitioner, which, in any event, ought to have been paid well before the impugned orders were made. The impugned default assessment orders expressly state that there is no mismatch between the selling and purchasing dealers. Yet a demand is sought to be raised in respect of alleged mismatch.
Following the judgments of this Court, inter alia in M/s S.K. Engg. Works (supra) and Pradeep Enterprises (supra), we are of the view that the impugned default assessment orders dated 14.11.2018 and the refund adjustment order dated 15.11.2018 cannot be sustained, and the same are hereby set aside. Consequently, the petitioner is entitled to refund of the amount of ₹17,59,874/- claimed by it. The said amount, along with interest payable under Section 42 of the DVAT Act, shall be disbursed by the DVAT authorities within four weeks from today.
FULL TEXT OF THE HIGH COURT ORDER / JUDGEMENT
1. The challenge in this writ petition is to default assessment orders dated 14.11.2018 and consequent refund adjustment order dated 15.11.2018 passed by the authorities under the Delhi Value Added Tax Act, 2004, (“hereinafter referred to as the DVAT Act”).
Please become a Premium member. If you are already a Premium member, login here to access the full content.
RIDER (To Supplement) :
Reverting to the added comment therein; the attempt made to illustrate the essence of the Del. HC Decision in Bansal’s case through a simple equation appears to have not helped in driving home the point one had in mind. Hence this Rider:
Furnish below, from the Article @ https://taxguru.in/…/deeming-a-legal-fiction-service-tax-a-…
Extract (of relevance) :
Q
3. 2. Even so, the disputed levy of service tax has been disapproved and set aside by the HC but on a limited but different ground.
The ground of the HC’s verdict is that THE LEVY CANNOT BE UPHELD AS THERE HAS BEEN NO STANDARD OR ACCEPTABLE MEASURE / MECHANISM PRESCRIBED IN THE GOVERNING STATUTE FOR DETERMINING THE VALUE OF SERVICES (being one of the three components embedded in the ‘composite contract’); and for excluding the value of ‘land’ (being the other component, indisputably an ‘immovable property’)
UQ (FONT supplied)
It is the so highlighted portion that has been tried to be illustrated:
Take a simple equation, say – A + B = C. If A (a Value, as adopted for ST ) is, as ruled by the HC, faulty hence should have been something different , then , also B, the residual (balance) value will, as a corollary, need a corresponding /equalising correction, so as to make A+B equals C (!)
In other words, though the HC has not specifically ruled that also levy of VAT suffers from the same illegality (as ST), by necessary implication, and by the same token of logic, levy of VAT, likewise, has been rendered ultra vires.
Over to……
Seizing the opportunity, and looking Back, as differently provoked (: It is commonly known or widelty expected to be known , as per the Del. HC’s Order in Bansal’s case, in which the levy of VAT was ruled as ultra vires the constitution, all collections made, till then, should have been refunded; not only to the party in that case, but to all those from whom VAT was collected.
Personally aware, when the point was raised with a bolder, a reputed one at that, by a buyer in respect of an ‘ongoing project’- registered with RERA- the simplistic answer heard to have been given was to the effect that the cited favourable HC verdict had not been accepted by the Revenue but been taken up and pending with the SC. Further, as if to add insult to the injury – that is, in blatant violation of the HC’s Ruling, – which has to be regarded, rightly so, to be binding unless and until the SC has conclusively decided the issue – builders, as heard, have been continuing to collect VAT.
The outstanding tragedy is that most of the fellow beings, having ‘vested interests’ (not barring the advising professionals), have not but remained submissively mute for reasons unknown. No wonder, for obvious reason, the Revenue, on its part, has remained muted likewise, by continuing to accept the collections.
No UPDATE on the present status thereof, it seems, is not readily available, for free !
if so incited and care to, suggest to Cr, Refer the several related Pr. Posts on Taxguru and other social websites; also mind to spare and share in case any better-founded contrastive view is possible ?!
RESOURCES- Google Search ; on this werbsite as well !