Impugned order quashed for want of proper notice

Sunil Kumar Agrawal Vs State of Chhattisgarh Through Joint Commissioner (Chhattisgarh High Court)

Chhattisgarh High Court held that impugned order is not sustainable as Show Cause Notice under Section 49 (3) is not stated to be issued nor placed on record by learned counsel for the State.

Facts-

After issuance of work order by SECL, petitioners, who are registered dealer under the provisions of the Chhattisgarh Value Added Tax, 2005 (the Act of 2005) and the Central Sales Tax Act, 1956 (the Act of 1956), submitted amendment application seeking incorporation of ‘High Speed Diesel HSD’ in their registration certificate for mining activities and granting permission to petitioners for inter-state purchase of HSD at concessional tax rates against C-Forms.

On making such application, registration certificates of petitioners were amended, ‘HSD for mining machineries’ was added with effect from respective dates mentioned in C-Forms of respective petitioners. After lapse of some time, respondent authority concerned issued letter/notice under Section 49 (1) of the Act of 2005 calling upon each petitioner individually to explain as to why entry ‘HSD for mining machineries’ made in their registration certificate be not deleted.

Respondent authorities passed order impugned deleting entry made in registration certificate of petitioners regarding purchase of HSD at concessional rate of tax. Consequent to passing of order of deletion of entry in registration certificate, respondent authorities have initiated proceeding under Section 10 (b) of the Act of 1956 against the petitioners in WPT Nos.111/2020, 112/2020 & 2/2021 and passed order under Section 10 (a) of the Act of 1956 of recovery of tax with penalty on them. Petitioners in aforementioned writ petitions have challenged both the orders of respondent authority.

Conclusion-

Amended Notice is of same dispatch number of State and provision of Section 49 (1) is also corrected by hand as Section 49 (3). Respondent State has not filed any other copy of show-cause notice under Section 49 (3). Hence, the impugned order is not sustainable for want of proper notice as held in other connected writ petitions and is liable to be quashed. Hence, the order impugned is hereby quashed.

Held that Show Cause Notice under Section 49 (3) is not stated to be issued nor placed on record by learned counsel for the State. Hence, the order impugned is liable to be and hereby quashed.

FULL TEXT OF THE ORDER OF ITAT CHHATTISGARH

1. South Eastern Coalfields Limited (SECL) floated different tenders for the work of Hiring of Heavy Earth Moving Machines (HEMM) for excavating overburden (all kinds of strata/ overburden in situ), loading into tippers, transportation and unloading of excavated materials and sprinkling & spreading of material at the site shown and other related works. Pursuant to notice inviting tender, petitioners participated in tender proceedings and on being successful in tender, work order was issued in their favour on different dates. After issuance of work order by SECL, petitioners, who are registered dealer under the provisions of the Chhattisgarh Value Added Tax, 2005 (henceforth ‘the Act of 2005’) and the Central Sales Tax Act, 1956 (for short ‘the Act of 1956’), submitted amendment application seeking incorporation of ‘High Speed Diesel HSD)’ in their registration certificate for mining activities and granting permission to petitioners for inter-state purchase of HSD at concessional tax rates against C-Forms. On making such application, registration certificates of petitioners were amended, ‘HSD for mining machineries’ was added with effect from respective dates mentioned in C-Forms of respective petitioners. After lapse of some time, respondent authority concerned issued letter/notice under Section 49 (1) of the Act of 2005 calling upon each petitioner individually to explain as to why entry ‘HSD for mining machineries’ made in their registration certificate be not deleted. Petitioners submitted reply to notice issued under Section 49 (1) of the Act of 2005. Respondent authorities passed order impugned deleting entry made in registration certificate of petitioners regarding purchase of HSD at concessional rate of tax. Consequent to passing of order of deletion of entry in registration certificate, respondent authorities have initiated proceeding under Section 10 (b) of the Act of 1956 against the petitioners in WPT Nos.111/2020, 112/2020 & 2/2021 and passed order under Section 10 (a) of the Act of 1956 of recovery of tax with penalty on them. Petitioners in aforementioned writ petitions have challenged both the orders of respondent authority i.e. order of deletion of entry included in registration certificate of petitioners by way of amendment and order imposing penalty under Section 10 (a) of the Act of 1956. Whereas, petitioners in other writ petitions bearing WPT Nos. 103/2020, 106/2020, 110/2020 & 1/2021, order deleting entry made in registration certificate is under challenge. Petitioner in WPT No.99/2020 has challenged the order deleting entry in registration certificates as also order of penalty.

2. As the facts and issue involved in above writ petitions are identical, therefore, this Court finds it appropriate to decide the same by this common order.

3. Substantial relief claimed by respective petitioners in these writ petitions are as follows:-

WPT No.99/2020;-

“10.1 Allow the present writ petition with costs.

10.2 Quash and set aside the impugned Notice dated 01.10.2020 issued by respondent No.1.

10.3 Quash and set aside the impugned order dated 14.10.2020 passed by respondent No.2.

10.4 Call for the record….”

WPT No.103/2020;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 12.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 12.10.2020 (Annexure P-1)

10.3 This Hon’ble Court may kindly be pleased to issue an appropriate writ directing the respondent  epartment to restore the registration certificate of the petitioner with insertion of words High Speed Diesel’ and ‘mining’ under the Chhattisgarh Value Added Sales Tax Act and Central Sales Tax Act as it stood vide order dated 15.05.2020 and dated 15.05.2020 respectively.

10.4 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.5 Cost of petition.”

WPT No.106/2020;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 12.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 12.10.2020 (Annexure P-1)

10.3 This Hon’ble Court may kindly be pleased to issue an appropriate writ directing the respondent department to restore the registration certificate of the petitioner with insertion of words ‘High Speed Diesel’ and ‘mining’ under the Chhattisgarh Value Added Sales Tax Act and Central Sales Tax Act as it stood vide order dated 03.07.2019 and dated 15.07.2019 respectively.

10.4 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.5 Cost of petition.”

WPT No.110/2020;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 12.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 12.10.2020 (Annexure P-1)

10.3 This Hon’ble Court may kindly be pleased to issue an appropriate writ directing the respondent department to restore the registration certificate of the petitioner with insertion of words ‘High Speed Diesel’ and ‘mining’ under the Chhattisgarh Value Added Sales Tax Act and Central Sales Tax Act as it stood vide order dated 12.05.2019 and dated 24.07.2019 respectively.

10.4 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.5 Cost of petition.”

WPT No.111/2020;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 29.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 29.10.2020 (Annexure P-1)

10.3 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.4 Cost of petition.”

WPT No.112/2020;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 14.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 14.10.2020 (Annexure P-1)

10.3 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.4 Cost of petition.”

WPT No.1/2021;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 14.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 14.10.2020 (Annexure P-1)

10.3 This Hon’ble Court may kindly be pleased to issue an appropriate writ directing the respondent department to restore the registration certificate of the petitioner with insertion of words ‘High Speed Diesel’ and ‘mining’ under the Chhattisgarh Value Added Sales Tax Act and Central Sales Tax Act as it originally stood.

10.4 Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.5 Cost of petition.”

WPT No.2/2021;-

“10.1 This Hon’ble Court may kindly be pleased to call for the entire record from the respondents pertaining to issuance of the order dated 15.10.2020 (Annexure P-1).

10.2 This Hon’ble Court may kindly be pleased to issue an appropriate writ quashing and setting aside the order dated 15.10.2020 (Annexure P-1) issued by respondent and declaring the same as arbitrary, illegal and against the provisions of the CST Act. (Annexure P-1)

10.3  Any other relief (s)/ order (s)/direction (s) in favour of petitioner, which this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.

10.4 Cost of petition.”

4. Mr. Ramit Mehta, learned counsel for petitioner in WPT No.99/2020 would submit that petitioner M/s Sunil Kumar Agrawal is a proprietorship firm duly registered under the Act of 1956 and the Act of 2005, having registration certificates dated 28.05.2004 & 1.4.2000. Petitioner deals in the business of undertaking works contract/order for deploying Heavy Earth Movers Machinery (HEMM) for execution of tasks/activities like overburden extraction and removal in mining, constructions of roads, bridges, canals, river channels etc. SECL invited tenders from eligible contractors for execution of aforementioned work. In response to notice inviting tender, petitioner submitted bid and was declared successful. After becoming successful in tender process, petitioner submitted an application before the respondent No.4-Commercial Tax Officer, Circle-II, Ragiarh for amending C-Forms issued to petitioner under the Act of 1956 & the Act of 2005. Based on application, petitioner was issued amended C-Forms adding and entering ‘HSD for mining machineries’. Based on entry made in registration certificate, petitioner started purchasing inter-state HSD at concessional rate of tax. Suddenly respondent Department issued notice under Section 49 (1) of the Act of 2005 to the petitioner calling upon to explain as why entry made in registration certificate of petitioner be not deleted. Petitioner submitted reply to said notice, but respondent No.2-Deputy Divisional Commissioner, Commercial Tax, Bilaspur Division No.2 overlooking contents of reply and provisions of law, passed impugned order 14.10.2020 and deleted entry in registration certificate of petitioner regarding ‘mining and HSD’ w.e.f. 5.2.2020. Consequent thereto, respondent No.4 passed amended order dated 29.10.2020 (Annexure P-19) for recovery of tax with penalty of Rs.1,96,08,045/- under Section 10(a) of the Act of 1956 and directing petitioner to deposit the same in government treasury within 30 days from receipt of order.

He submits that after issuing notice under Section 49 (1) of the Act of 2005 to petitioner, the order dated 14.10.2020 has been passed. As per provisions of Section 49 (1), no order prejudicial to the interest of the dealer or person can be passed. If for any reason any order prejudicial to the interest of a dealer or person is to be passed, it can only be after issuance of notice under Section 49 (3) of the Act of 2005, after conducting enquiry and giving reasonable opportunity of hearing to registered dealer/ person concerned. In case at hand, no notice under Section 49 (3) of the Act of 2005 was issued to petitioner before passing impugned order which is prejudicial to interest of petitioner. Notice, which is placed on record as Annexure P-13, only mentions ‘notice under Section 49 (1) of the Act of 2005’. Hence, the impugned order deleting the words ‘mining’ and ‘HSD’ from registration certificates of petitioners is in violation of the principles of natural justice, hence per se illegal. Notice (Annexure R-3) submitted along with reply to writ petition is an interpolated document. In this notice, sub-section typed within bracket i.e. ‘1’, is changed to ‘3’ by handwriting. Proceedings against petitioner based on issuance of notice under Section 49 (1) of the Act of 2005 cannot be termed to be proceedings initiated under Section 49 (3) of the Act of 2005. Under Rule 61 of the CG Value Added Rules, 2006 (for short ‘the Rules of 2006’) notice is required to be issued in Form-55, appended to the Rules of 2006. No notice in Form-55 was ever issued to petitioner. If Statute provides for issuance of notice under a particular Format / Form, then authority, if at all decided to take any action against petitioner, is required to issue notice to petitioner in prescribed Format under Rule 61 of the Rules of 2006. He contended that even if for the sake of argument, admitting issuance of notice under Section 49 (3) of the Act of 2005, then also notice under Section 49 (3) could have been issued only in Form-55 as prescribed under the Rules of 2006. The Assistant Commissioner, Raigarh Circle-1, Raigarh in letter dated 4.9.2020 (Annexure P-12) has also mentioned that HSD is being used in mining, which clearly shows that petitioner was using HSD for mining work. Respondent Department misunderstood the nature of work mentioned in the Work Order issued to petitioner by SECL. Removing of strata and overburden are integral part of mining.

It is further contended that Section 8 of the Act of 1956 deals with rates of tax on sales in the course of inter-State trade or commerce. Sub-section (1) prescribes rate of tax payable if the goods of description referred to in sub-section (3) of Section 8 is in the course of inter-state trade or commerce. Petitioner is engaged in mining activities. The words ‘in mining’ are used under clause (b) of sub-section (3) of Section 8 of the Act of 1956. Goods specified for the purpose of work, as mentioned in sub-section (3), entitle the petitioner for concessional rate of tax and therefore, petitioner was charged with concessional rate of tax on inter-state purchase/trade of ‘high speed diesel’ to carry out mining activities. Respondent authorities have mentioned in document/letter issued in the course of correspondences that high-speed diesel (HSD) purchased by petitioner is being used for mining activities. SECL – employer had also issued certificate to the effect that nature of work awarded to petitioner comes within the category of ‘mining activity’, even then respondent Department had illegally and arbitrarily passed impugned orders. Nature of work awarded to the petitioner is one of the main process of mining in winning of coal. He referred to definition of words ‘mining’ & ‘extract’ given in the Black’s Law Dictionary. Extraction and removal of overburden is preliminary mandatory operation, it is also a process of winning of mineral. In support of his contention, he relied upon decision of Hon’ble Supreme Court in case of Bhagwan Dass vs. State of UP & ors, reported in (1976) 3 SCC 784.

He also referred to definition of ‘mining operations’ given in Section (3) (d) of the Mines and Minerals (Regulation and Development) Act, 1967 and contended that definitions of ‘mine’ and ‘mining operations’ are very wide and sufficient to comprehend every activity by which a mineral is extracted or obtained. In support of his contention he placed his reliance on the judgment of Hon’ble Supreme Court in case of Bharat Cooking Coal Ltd. vs. State of Bihar & ors, reported in (1990) 4 SCC 557. He further submits that respondent authorities have erroneously interpreted provisions of Section 8 (3) (b) of the Act of 1956, which is an attempt to rewrite a piece of legislation. Demand made while passing impugned order by respondent authority classifying the word ‘mining’ as ‘in mining’ and ‘for mining’ is misinterpretation of words. Unless and until there is extraction of overburden and its removal, there cannot be winning/extraction of coal, therefore, nature of work awarded to petitioner is one of the process of mining. Petitioner made request to respondent Department for amending registration certificates by adding high-speed diesel (HSD) in list of specified goods for mining activities. He also relied upon judgment of Hon’ble Supreme Court in case of Indra Singh & Sons v. S.T.O., reported in (1966) 17 STC 510 (SC). Respondent authorities have mentioned that petitioner had misused C-Forms, which is wrong and per se illegal. Respondent authorities could not able to point out any mens rea, hence penalty ought not to have been imposed.

Reliance is also placed on judgment rendered in case of Answar Hussain Khan vs. Mohd. Shafi & ors, reported in (2001) 8 SCC 540; order dated 25.7.2019 passed by Division Bench of this High Court in WPC No.1120/2019 and order dated 13.4.2017 passed by Co-ordinate Bench of this Court in WPT No.55/2017.

5. Mr. Sumeet Gadodiya, learned counsel for petitioners in WPT Nos.1/2021 & 2/2021 while adopting submissions of learned counsel for petitioner in WPT No.99/2020, submitted that notice under Section 49 (1) of the Act of 2005 is signed and issued by respondent No.2-Joint Commissioner, State Tax Bilaspur, Division No.2, Bilaspur, as appearing from notice (Annexure P-13). From the heading of notice filed along with reply as Annexure R-2, it is apparent that it is an ‘amended notice’. Further, in this notice it is typed as ’43 (1)’, whereas correction is made by handwriting to figure ‘1’ as ‘3’ [49(3)] by overwriting, which is clearly reflecting from copy of notice annexed as Annexure R-2. The Prescribed Authority for issuance of notice under Section 49 (1) or (3) of the Act of 2005 is the ‘Deputy Commissioner’, whereas initial notice was issued by the Joint Commissioner and subsequently the words ‘Deputy Commissioner, Commercial Tax’ were added by handwriting and putting slash (/). As per Rule 55 of the Rules of 2006, the Commissioner may delegate powers conferred upon him to other officer for the purpose of taking any action under the provisions of the Act of 2005, described in table given in Rule 55. It is mentioned in Sr. No.13 of the column specified in Rule 55 that the Commissioner may delegate ‘power of revision’ conferred under Section 49 of the Act of 2005 upon the Deputy Commissioner. Judgment relied upon by respondent Department for deleting entries regarding ‘HSD’ and ‘mining’ from C-Forms of petitioner is based on the judgment of Hon’ble Supreme Court in case of Indra Singh (supra), which is not applicable to the facts of present case. Penalty under Section 10 of the Act of 1956 could not be imposed mentioning provisions of Section 10 (b) & (d) of the Act of 1956. Petitioner has not made false representation at the time of purchasing goods covered under certificates of registration and it is not the case / allegation of using goods for any other purpose. Pursuant to application submitted by petitioner for adding entries by amending registration certificates, respondent authorities entered words ‘mining work’ and ‘HSD’ and therefore, penalty cannot be imposed only on the ground of deletion of those additional entries made in registration certificate. He also contended that deletion could not be given effect to retrospectively. Penalty from back date is also not permissible. In support of his contention, he places reliance upon judgment in the case of Commercial of Sales Tax, Uttar Pradesh vs. Sanjiv Fabrics, reported in (2010) 9 SCC 630. For imposing penalty under Section 10 (a) of the Act of 1956, mens rea is a condition precedent, which is not the allegation against petitioner by respondents. Case law relied upon by respondents for deleting entries ‘in mining’ and ‘HSD’ from registration certificates is entirely on different facts. Referring to Paragraph -4 of judgment in Indra Singh’s case (supra) he submits that question for consideration before Hon’ble Supreme Court was that motor trucks, furniture, sanitary fittings, medicines, insecticides to be goods intended for use in mining and that has been answered in negative in Paragraph 18 of the judgment. The Goods and Service Tax Act came into force in the year 2017, but petrol, diesel etc. have not been included under GST and for the purpose of imposition of tax, HSD, petrol is governed by old Central Sales Tax Act and Value Added Tax Act. In support of his contention, he referred to decision of this High Court dated 18.5.2018 in WPT No.83/2018, parties being Shree Raipur Cement Plant vs. State of CG & ors. Under the Finance Act, 2021, which came into force w.e.f. 1.4.2021, HSD cannot be purchased under concessional rate of tax.

Work awarded to petitioner is primary and initial work of mining activities. For the purpose of winning of mineral like ‘coal’ in case at hand, removal of overburden is integral part of mining.

On the issue of scope of mining activity, learned counsel places his reliance on the judgment rendered in Bhagwan Dass v. State of UP & ors reported in (1976) 3 SCC 784; Bharat Cooking Coal Ltd. vs. State of Bihar & ors reported in (1990) 4 SCC 557; State of Meghalaya vs. All Dimsa Student Union & ors reported in (2019) 8 SCC 177; Chougle & Co. Pvt. Ltd. vs. UOI reported in (1971) 3 SCC 162; Sadbhav Engineering Ltd. vs. State of UP (2014) SCC Online All 13564; Assessing Authority-cum-Excise and Taxation Officer, Gurgaon and another vs. East India Cotton Mfg. Co. Ltd., Faridabad reported in (1981) 3 SCC 531.

On the issue of rule of interpretation of statutes, learned counsel relied upon judgment in case of Anwar Hasan Khan Mohd. Shafi and other reported in (2001) 8 SCC 540.

On the issue of levy of penalty under Section 10A of the Act of 1956, he relied upon judgment in case of Commissioner, Trade Tax UP Lucknow vs. Project Technologist Pvt. Ltd. reported in (2012) 48 VST 406 (All); KNI Eqbal v. State of Tamil Nadu reported in (1996) 101 STC 354; Commissioner of Sales Tax UP Lucknow vs. Kashi Prasad Ram Chandra Lal reported in (2001) 122 STC 567; State of Tamil Nadu v. Gemini Studios reported in (1975) 36 STC 357 (Mad); Commissioner of Sales Tax Madhya Pradesh, Indore vs. Bombay Garage reported in (1984) 57 STC 67; Commercial Taxes Officer vs. Foreign Import & Export Association reported in 1979 SCC Online Raj 235 & CTO vs. Foreign Import and Export Association reported in (1994) 95 STC 101.

6. Mr. Anand Dadariya, learned counsel for petitioners in WPT Nos.103, 106, 110, 111 & 112 of 2020 while adopting submissions made by Mr. Ramit Mehta & Mr. Sumeet Gadodia, Advocate for petitioners in respective writ petitions, contended that petitioners being successful in tender process initiated by SECL, submitted application before the respondent Department seeking amendment in their registration certificates issued under the State Sales Tax Act and Central Sales Tax Act. In the application they have specifically mentioned the nature of work which was awarded by SECL. After verification, respondent Department amended registration certificates by entering the words ‘mining’ and ‘high-speed diesel (HSD)’ in registration certificate. Issue involved in these writ petitions is whether proper notice was issued to petitioners for Sales Tax (Central) or not? The authority who had issued notice under Section 49 (1) of the Act of 2005 is not competent to issue such notice. Section 3 of the Act of 2005 prescribes ‘Taxing Authorities and other officers’. Joint Commissioner is not prescribed under Section 3 to be a taxing authority/officer. Notice issued to petitioners is under the signature of Joint Commissioner, as such, it is without jurisdiction. Section 3 (d) of the Mines and Minerals (Regulation and Development) Act, 1957 defines ‘mining operations’. Section 2 (i) (j) of the Mines Act, 1952 defines ‘mines’ which means any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on. ‘Mining Operations’ means any operation undertaken for the purpose of winning any mineral. The work awarded to petitioners is primary and initial work of mining activities. For the purpose of winning of mineral like ‘coal’ in case at hand, removal of overburden is integral part of mining. Mining activities do not mean extraction of coal only, but all activities of extraction. Amendment/ addition in registration certificate of petitioners is made on 12.5.2019. It was deleted on 12.10.2020 from back date, which is not permissible under law. Amendment/ modification or correction in registration certificate can be by the Commercial Tax Officer only. It is argued that registration of dealer is regulated under Sections 16 to 18 of the Act of Section 16 deals with application for registration. Rule 2 (1) (j) of the Rules of 2006 defines ‘registering authority’ which means appropriate Commercial Tax Officer or any officer appointed under section 3 to whom the Commissioner has delegated his power. Amendment or deletion or removal of any goods specified in registration certificate can be done only by registering authority. Notice as alleged was not issued by registering authority. Employer who awarded work to the petitioner i.e. SECL, issued certificate mentioning that work of removal of overburden and strata for extraction of coal falls under mining activities. Impugned action on the part of respondents is arbitrary and discriminatory. C-Forms are also issued to Sindhu Traders, who is engaged in similar work with same organization i.e. SECL, mentioning ‘in mining’ and ‘HSD’.

He next contended that penalty cannot be imposed upon petitioners. Adopting submissions of learned counsel for petitioners in other connected petitions, he submits that for imposing penalty mens rea is pre-condition which is lacking in case of present petitioners. Apart from the decisions relied upon by learned counsel for petitioners in other connected writ petition, he places his reliance on the decisions of Hon’ble Supreme Court in (1996) 17 STC 510 Anwar Hassan Khan vs. Mohd. Shafi & ors reported in (2001) 8 SCC 540; Civil Appeal No.2217/2011, Commercial Tax Officer v. M/s Bombay Machinery Store; State of UP vs. Vam Organic Chemicals reported in (2010) 6 SCC 222; Pepsico India Holdings Pvt. Ltd. vs State of Kerala & ors reported in (2009) 15 STJ 245 (SC).

7. Mr. Sandeep Dubey, learned Deputy Advocate General and Mrs. Richa Shukla, Deputy Government Advocate for respondents raised objection with regard to maintainability of all these writ petitions on the ground of availability of efficacious alternative remedy of filing appeal under Section 49 (4) of the Act of 2005. It is contended that Joint Commissioner initially issued notices under Section 49 (1) of the Act of 2005, however, on the same date amended notices under Section 49 (3) of the Act of 2005 were issued to petitioners. In amended notices there is mention of ‘Deputy Commissioner’ along with Joint Commissioner’, who is Prescribed Authority under law for correcting or amending registration certificate. Referring to Notification issued by the State Government dated 14.7.2017, it is contended that one authority can act in dual capacity. When an authority exercises powers under the Act of 2005, it invokes jurisdiction of Joint Commissioner and while exercising powers under the Act of 1956, he acts as Deputy Commissioner. Amended notice has been sent mentioning provision under Section 49 (3) of the Act of 2005 and authority to be ‘Deputy Commissioner’ on the registered email address of petitioners. Hence, submission of learned counsel for respective petitioners that they were not served with notice under Section 49 (3) of the Act of 2005 is not sustainable. Detailed reply to notice under Section 49 (1) of the Act of 2005 was submitted by respective petitioners raising all grounds as are available to them. Notice issued to petitioners is not for enhancing assessment and penalty thereupon or both, it is for amendment in registration certificate, hence Rule 6 of the Rules of 2006 will not apply to facts of present cases and as such, there was no requirement of issuing notice in Form-55 appended to Rule 6 of the Rules of 2006. Rule 2 (1) (j) of the Rules of 2006 is not having any application as the order was passed by Deputy Commissioner. SECL is not having any authority to issue any certificate because SECL itself is a lessee of land over which permission for mining operations was granted. Petitioners are not having any mining license or they have not taken any land on lease for mining and extraction of minerals. Referring to Page No.80 of writ petition, it is argued that in base price of diesel, GST is included in value of work awarded. Diesel price mentioned in documents placed on record includes 35% VAT. Petitioners have not produced any entry register showing consumption of diesel purchased for mining activities. Notice has been issued to the petitioners in accordance with law, therefore, petitioners could have very well approached the Appellate Authority. Removal of overburden will not fall within the purview of mining activity. Proceedings initiated by respondents are in accordance with law which do not call for any interference.

8. In reply to submissions of learned counsel for the State, Mr. Anand Dadariya, learned counsel for petitioners in respective writ petitions submits that amended notices were received with correction but there was no new despatch number to the alleged amended notices, the same were also not in prescribed format. If amended notice is issued subsequently by authority mentioning any of portion of earlier notice, then it will be deemed to be a fresh notice, requiring fresh despatch by authority. Under Section 18 of the Act of 2005 it is only the Commercial Tax Officer who can pass orders. In application seeking amendment in registration certificate, nature of work is specifically mentioned. Application was recommended vide Annexure P-8. It is contended that even if for the sake of argument, it is admitted that notice is issued under Section 49 (3) of the Act of 2005, the respondent authorities have not provided any opportunity of hearing to the petitioners, who are registered dealer. Reasonable opportunity of hearing, as provided under Section 49 (3) of the Act of 2005, means personal hearing to the registered dealer (here the petitioners) which is absent in cases at hand. Notice issued under Section 49 (1) is under both Sales Tax i.e. State and Central. Referring to Annexure P-13, he submits that desptach number mentioned is ‘1096’ in notice issued under Section 49 (1) dated 1.10.2020 bears Revision Case No.145/KC-I/2020 (State). Another notice issued on the same date bears despatch No.1097 for Revision Case No.146/KC-I/2020 (Central). Respondent authorities have issued two separate notices under both Sales Tax statutes i.e. State & Central under Section 49 (1). Amended notice filed by respondent State along with reply as Annexure R-2, if at all issued in accordance with law, bears same desptach number i.e. ‘1096’. Respondents have not placed on record amended notice if issued for the revision/amendment of registration certificate under the Act of 1956. Petitioners are having two separate registrations, one under the Act of 2005 and another under the Act of 1956. Question involved of getting HSD under concessional rate of tax is of inter-state purchase, therefore, its registration certificate under the Act of 1956 is subject matter. Respondents have not considered the grounds of pleadings in reply to notice under Desptach No.1097, which is under Section 49 (1) of the Act of 2005 and passed the impugned orders. Non-consideration of reply amounts to violation of principles of natural justice. In support of his contention he places his reliance on the judgment of Hon’ble Supreme Court in Assistant Commissioner, Commercial Tax Department Works Contract and Leasing, Kota v. Shukla & Brothers reported in (2010) 4 SCC 785.

It is contended that petitioners appeared in the proceedings initiated for imposition of penalty on the date fixed and sought time which was granted by respondents. However, thereafter no notice was issued intimating next date for appearance. Specific ground in this regard has been taken in writ petition. Respondents have in fact mentioned in the order that after submission of reply, petitioner chose not to appear in the proceedings, which is incorrect. With regard to objection raised by learned counsel for the State regarding maintainability of writ petitions, he places reliance upon the judgment of Hon’ble Supreme Court in case of Commissioner of Central Excise vs. Singhai Sushil Kumar reported in (2016) 13 SCC 223.

Under the scheme of tax it is for the selling dealer to charge tax. Initially, petitioner in WPT No.1/2021 filed an application seeking amendment in registration certificate which was not considered. Petitioner filed writ petition before this Hon’ble Court and only thereafter amendment in registration certificate was done. Online portal was not opened for getting benefit of purchase of goods mentioned in registration certificate, therefore, petitioner again filed writ petition bearing number WPT 37/2020.

9. I have heard learned counsel for parties and perused the documents brought on record by respective parties.

10. So far as submission of learned counsel for respondents that these writ petitions are not maintainable in view of availability of efficacious alternative statutory remedy of filing of appeal under Section 49 (4) of the Act of 2005 is concerned, normally writ petitions filed by-passing alternate statutory remedy available under the law are not to be entertained, but there is no absolute bar. The bar created by Courts is self-restrained. Writ petition filed directly before the High Court under Article 226 of the Constitution of India can be entertained in cases where petitioner / petitioners can able to show that, (i) writ petition has been filed for enforcement of any of fundamental rights; (ii) where there has been violation of principles of natural justice; (iii) where order or proceeding is absolute without jurisdiction; or vires of an Act is challenged. Hon’ble Supreme Court in case of Harbanslal Sahnia v. Indian Oil Corpn. Ltd. reported in (2003) 2 SCC 107 held thus:-

“7. So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the appellants was liable to be dismissed, suffice it to observe that the rule of exclusion  of writ jurisdiction by availability of an  alternative remedy is a rule of discretion and  not one of compulsion. In an appropriate  case in spite of availability of the alternative  remedy, the High Court may still exercise its  writ jurisdiction in at least three  contingencies: (i) where the writ petition seeks enforcement of any of the Fundamental Rights; (ii) where there is failure of principles of natural justice or, (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act and is challenged [ See Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. (1998) 8 SCC 11]. The present case attracts applicability of first two contingencies. Moreover, as noted, the petitioners’ dealership, which is their bread and butter came to be terminated for an irrelevant and non-existent cause. In such circumstances, we feel that the appellants should have been allowed relief by the High Court itself instead of driving them to the need of initiating arbitration proceedings.

Recently, in case of Assistant Commissioner of Sales Tax & others vs. Commercial Steel Limited reported in 2021 SCC Online SC 884, Hon’ble Supreme Court while dealing with question of maintainability of writ petition has held that the High Court having regard to the facts of the case, can exercise discretion to entertain or not to entertain writ petition. An alternative remedy is not an absolute bar for invoking writ jurisdiction of the High Court under Article 226 of the Constitution of India and in cases where the authority against whom writ is filed is shown to have had no jurisdiction or had usurped jurisdiction without any legal foundation, writ petition can be entertained.

11. From the aforementioned rulings of Hon’ble Supreme Court, it is apparent that only because of availability of alternative efficacious remedy of appeal under the law, writ petition under Article 226 of the Constitution of India may not be dismissed and the Courts while exercising jurisdiction under Article 226 of the Constitution of India can entertain writ petition if one of the grounds, as discussed in above rulings, is made out.

12. In the case at hand, petitioners, who are registered dealers under the Act of 2005 as also the Act of 1956, have been awarded contract by South Eastern Coalfields Ltd. for execution of work of excavating overburden (all kinds of strata/ overburden in situ), loading into tippers, transportation and unloading of excavated materials; sprinkling & spreading of material at the site shown and other related works, awarded to them by South Eastern Coalfields Ltd. under contract. After award of contract, petitioners submitted application seeking inclusion of ‘high-speed diesel (HSD) and ‘mining’ in their registration certificates under the Act of 2005 and in certificate under the Act of 1956. Accordingly, their registration certificates were amended. Thereafter, petitioners made interstate purchase of ‘high speed diesel’ for execution of contract work within territorial jurisdiction of State of Chhattisgarh. Subsequently, entries ‘mining’ and ‘high-speed diesel’ were deleted by respondent Department and the same has been challenged by petitioners by filing these writ petitions. The petitioners have raised the ground that respondent Department had not issued proper notice under Section 49 (3) of the Act of 2005 for deleting entries ‘mining’ and ‘high-speed diesel (HSD)’ from their registration certificates and deleted entries ‘mining’ and ‘high-speed diesel (HSD)’ from the registration certificates of petitioners issued under the Act of 1956. In some case, after deletion of entries from registration certificate, consequential order of recovery of tax with penalty has been passed against petitioners concerned. Question for consideration is whether in the above facts of the case, petitions can be entertained in view of the exception set out by Hon’ble Supreme Court in Harbans Lal Sinha’s case (supra). and Commercial Steel Ltd. (supra)

13. The Act of 2005 is with respect to levy of tax on sale and purchase of goods in the State of Chhattisgarh. In case at hand, issue of levy of tax is on goods purchased by registered dealer from outside the State (inter-state purchase) and it will be governed by the Act of 1956. Section 2 (f) of the Act of 1956 defines ‘registered dealer’, which means a dealer registered under section 7. Section 6 deals with liability to tax on inter-State sales. Section 7 deals with ‘registration of dealer’ and sub-section (1) of Section 7 is extracted below for ready reference:-

“(1) Every dealer liable to pay tax under this Act shall, within such time as may be prescribed for the purpose, make an application for registration under this Act to such authority in the appropriate State as the Central Government may, by general or special order, specify, and every such application shall contain such particulars as may be prescribed.”

Section 8 of the Act of 1956 provides ‘rates of tax on sales in the course of Inter-State trade or commerce and relevant portion of Section 8 is reproduced below for ready reference;-

“8. Rates of tax on sales in the course of Inter-State trade or commerce.-

(1) Every dealer, who in the course of inter-State trade or commerce,

(a) sells to be Government any goods or

(b) sells to a registered dealer other than the Government, goods of the description referred to in sub-section (3), shall be liable to pay tax under this Act, which shall be⁶ [four per cent] of his turnover.

(2) The tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale of goods in the course of inter-state trade or commerce not falling within sub-section (1)-

(a) in the case of declared goods, shall be calculated at twice the rate applicable to the sale or purchase of such goods inside the appropriate State; and

(b) in the case of goods other than declared goods, shall be calculated at the rate of ten percent or at the rate applicable to the sale or purchase of such goods inside the appropriate State, whichever is higher.

an for the purpose of making any such calcJxempt from tax generally or subject to tax generally at a rate which is lower than four percent (whether called a tax or fee or by any other name), shall be nil, or as the case may be, shall be calculated at the lower rate.

(3) The goods referred to in clause (b) of sub section (1)-

(a) [Omitted]

(b) are goods of the classes specified in the certificate of registration of the registered dealer purchasing the goods as being intended for resale by him or subject to any rules made by the Central Government in this behalf, for use by him in the manufacture or processing of goods for sale or in mining or in the generation or distribution of electricity or any other form of power….”

14. Under sub-section (3) (b) of Section 8 of the Act of 1956, there is mention of goods of classes specified in the certificate of registration of a registered dealer purchasing goods for use by him in the manufacture or processing of goods for sale or in mining or in the generation or distribution of electricity or any other form of power. Petitioners being registered dealers under the Act of 1956 made inter-state purchase of High-Speed Diesel (HSD) for its use in the work of excavating overburden (all kinds of strata/ overburden in situ), loading into tippers, transportation and unloading of excavated materials.

15. Section 9 of the Act of 1956 talks about levy and collection of tax and penalties and relevant portion of which is quoted below:-

“(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter-State trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provision of sub-section (2), in the State from which the movement of the goods commenced.

Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods and being also a sale which does not fall within sub-section (2) of section 6, the tax shall be levied and collected-

(a) where such subsequent sale has been effected by a registered dealer, in the State from which the registered dealer obtained or, as the case may be, could have obtained, the form prescribed for the purposes of clause (a) of sub­section (4) of section 8 in connection with the purchase of such goods; and

(b) where such subsequent sale has been effected by an unregistered dealer, in the State from which such subsequent sale has been effected.

(2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess re-assess, collect and enforce payment of tax, including any 4[interest or penalty,] payable by a dealer under this Act as if the tax or 4[interest or penalty] payable by such a dealer under this Act is a tax or 4[interest or penalty] payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of, or successor to, such business, transfer of liability of any firm or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, 5[refunds, rebates, penalties,] 6[charging or payment of interest,] compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly: Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, be rules made in this behalf make necessary provision for all or any of the matter specified in this sub-section.

[(2A) All the provisions relating to offences, interest and penalties (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment for an offence but excluding the provisions relating to matters provided for in section 10 and 10A) of the general sales tax law of each State shall, with necessary modifications, apply in relation to the assessment, re-assessment, collection and the enforcement of payment of any tax required to be collected under this Act in such State or in relation to any process connected with such assessment, re­assessment, collection or enforcement of payment as if the tax under this Act were a tax under such sales tax law.]

[(2B) If the tax payable by any dealer under this Act is not paid in time, the dealer shall be liable to pay interest for delayed payment of such tax and all the provisions for delayed payment of such tax and all the provisions relating to due date for payment of tax, rate of interest for delayed payment of tax, of the general sales tax law of each State, shall apply in relation to due date for payment of tax, rate of interest for delayed payment of tax, and assessment and collection of interest for delayed payment of tax under this Act in such States as if the tax and the interest payable under this Act were a tax and an interest under such sales tax law.”

16. Under sub-section (2) of Section 9 of the Act of 1956, it is prescribed that the authority for the time being empowered to assess, collect and enforce payment of any tax under the General Sales Tax Law of the appropriate State shall, on behalf of the Government of India, assess, reassess, collect and enforce payment of tax. The petitioners had issued C-Forms under Rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957 (for short ‘the Rules of 1957’). Rule 2 (aa) of the Rules of 1957 defines ‘authorized officer’ which means an officer authorized by the Central Government under clause (b) of sub-section (4) of section 8. Rule 2 (cc) defines ‘prescribed authority’ which means the authority empowered by the Central Government under sub-section (2) of section 9 or the authority prescribed by a State Government under clause (e) of sub-section (4) of section 13, as the case may be.

17. The State Government in exercise of powers under Section 13 of the Act of 1956 framed the Rules known as ‘Chhattisgarh Sales Tax (Central) Rules, 1957 (for short ‘Rules of 1957’). Rule 2 (a) says that the Act means the Central Sales Tax Act 1956 and Rule 2 (h) says that ‘section’ means a Section of the Act. Rule 2 (e) defines ‘notified authority’ which means any authority specified by the Central Government as such under sub-section (1) of Section 7 read with Rule 2 (d) of the Rules of 1957. Rule 8 prescribes the authority from which
declaration forms may be obtained, use, custody and maintenance of records of such Forms and matters incidental thereto. Rule 8 (1) (a) is relevant and the same is quoted below:-

“(a) A registered dealer, who wishes to purchase goods from another such dealer on payment of tax at the rate applicable under the Act to sales of goods by one registered dealer to another, for the purpose specified in the purchasing dealer’s certificate of registration, shall obtain from the ‘appropriate 21 [Commercial Tax Officer] or any other officer as may be authorised by the Commissioner in this behalf 22[blank declaration in Form ‘C’ as prescribed under sub-rule (1) of rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957] for furnishing it to 1he selling dealer. Before furnishing the declaration to the selling dealer. the purchasing dealer, or any responsible person authorised by him in this behalf shall fill in all required particulars in the Form. and shall also affix his usual signature in the space provided in the Form for this purpose. Thereafter, the counterfoil of the Form shall be retained by the purchasing dealer and the other two portions marked “Original’. and “duplicate” shall be made over by him to the selling dealer.”

18. Section 7 (1) of the Act of 1956 envisages that for registration of dealer an application for registration under this Act is to be made before such authority in the appropriate stage as the Central Government may, by general or special order, specify. The taxing authorities and other officers are prescribed under Section 3 of the Act of 2005, which reads as under:-

“3. Taxing Authorities and other Officers. – (1) There may be appointed a person to be the Commissioner of [Commercial Tax] and the following category of officers to assist him, namely :-

(a) Additional Commissioner of [Commercial Tax];

(b) Appellate Deputy Commissioner or Additional Appellate Deputy Commissioner of [Commercial Tax];

(c) Deputy Commissioner or Additional Deputy Commissioner of [Commercial Tax];

(d) Assistant Commissioner or Additional Assistant Commissioner of [Commercial Tax];

(e) [Commercial Tax] Officer or Additional [Commercial Tax] Officer;

(f) Assistant [Commercial Tax] Officer; and

(g) Inspector of [Commercial Tax].

(2) The Commissioner of [Commercial Tax] and the Additional Commissioner of [Commercial Tax] shall be appointed by the State Government and the other officers referred to in sub-section (1) shall be appointed by the State Government or such other authority as it may direct.

(3) The Commissioner of [Commercial Tax] and the Additional Commissioner of [Commercial Tax] shall exercise all the powers and perform all the duties conferred or imposed on the Commissioner by or under this Act throughout the State and for this purpose any reference to the Commissioner in this Act, shall be construed as a reference to the Additional Commissioner of [Commercial Tax].

(4) Other officers referred to in sub-section (2) shall, within such areas as the Appointing Authority may, by general or special order specify, exercise such powers as may be conferred and perform such duties as may be imposed by or under this Act.

[3A. Tribunal. – (1) Subject to such rules as may be made in this behalf, the State Government may, by notification, with effect from a date specified therein, constitute Tribunal to exercise the powers and perform the functions conferred on the Tribunal by or under the Act.

(2) fill the date specified in the notification under sub­section (1), the Board of Revenue, Chhattisgarh shall act as Tribunal for the purpose of this Act and on the date aforementioned all proceedings pending before the Board of Revenue, Chhattisgarh, acting as Tribunal shall stand transferred to the Tribunal constituted under sub-section (1).

(3) Subject to the previous approval of the State Government, the Tribunal may, from time to time, make regulations not inconsistent with the provisions of this Act regulating the procedure and disposal of its business.”

19. Vide order dated 14.10.2020 (Annexure P-1 to WPT No.1/2021) the entries ‘mining’ and ‘high-speed diesel (HSD)’ are deleted from registration certificates issued under the Act of 2005 and the Act of 1956. The order, Annexure P-1, bears Revision No.145 K.C.-1/20 (State) and Revision No.146 K.C.- 1/20 (Central). Revision petition was considered against the order of amendment in exercise of powers under Section 49 (3) of the Act of 2005.  erual of Annexure P-13 & P-14 to WPT No.1/2021, would show that these are show-cause notices to the petitioner. Notice Annexure P-13 issued bear despatch No. and  issued to the petitioner in respect of Revision Case No.145 K.C.-1/2020 (State). This notice is under Section 49 (1) of the Act of 2005 for initiating suo motu revision proceeding for deletion of entry of ‘mining activities’ and ‘high- peed diesel’ from registration certificate and its amendment because of misuse of C-Forms. Similarly, notice of  nnexure P-14 was issued to petitioner under Section 49 (1) of the Act of 2005 on the same date with desptach No.  in respect of Revision Case No.146/KC-1/2020 (Central). Thesenotices were issued by respondent No.- Joint Commissioner, State Tax, Division No.2, Bilaspur (CG).

20. Section 49 (1) of the Act of 2005 talks abut power of revision by Commissioner and clause (ii) of sub-section (1) of Section 49 envisages that the Commissioner may pass such order thereon not being an order prejudicial to the dealer or person as he thinks fit. In other words, while exercising revisional powers under sub-section (1) of Section 49 of the Act of 2005, the Commissioner cannot pass any order prejudicial to the dealer. Sub-section (3) of Section 49 of the Act of 2005 grants suo motu powers to the Commissioner to examine record of any proceeding under this Act, if he considers that any order passed therein by any person appointed under Section 3 to assist him is erroneous and prejudicial to the interest of revenue, then he may after giving dealer or a person reasonable opportunity of being heard, and after making or causing to be made such enquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment. Sub-section (3) of Section 49 of the Act of 2005 is extracted below for ready reference:-

“(3) The Commissioner may on his own motion or on information received call for and examine the record of any proceeding under this Act, if he considers that any order that any order passed therein by any person appointed under Section 3 to assist him including any officer to whom he has delegated his powers under sub-section (1) is erroneous and prejudicial to the interest of revenue, and he may after giving the dealer or a person reasonable opportunity of being heard, and after making or causing to be made such enquiry as he deems necessary, pass within one calendar year from the date of initiation of proceeding such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment.”

21. Plea taken by the petitioner in WPT No.1/2021 is non-issuance of proper notice for amending registration certificate of petitioner issued under Rule 5 (1) of the Rules of 1957. Respondent Department along with its reply have submitted document as Annexure R-2, stated to be issued to the petitioner under Section 49 (3) of the Act of 2005. Perusal of this notice Annexure R-2 would show that at the top it is mentioned as ‘amended notice’. This notice bears number ”, which means there is no fresh despatch number of notice purported to have been issued under Section 49 (3) of the Act of 2005. Further, this notice is with respect to Revision No.145 K.C.-1/20 (State). It further revealed that some handwritten correction is made in it. Notice, if any as stated by learned counsel for respondent Department, is issued under Section 49 (3) of the Act of 2005, then it is only with regard to deletion of entries in registration certificate issued under the Act of 2005. Except notice of Annexure R-2, respondent Department has not placed on record any other show-cause notice under Section 49 (3) of the Act of 2005 having separate despatch number or for Revision Case No. 146 K.C.-1/20 (Central).

22. Registration of petitioner under the Act of 1956 is under Rule 5 of the Rules of 1957. Rule 9 of the Rules of 1957 provides for amendment or cancellation of certificate of registration. Rule 9 of the Rules of 1957 reads thus:-

“9. Amendment or cancellation of certificate of registration.- (l) A notified authority shall, before amending or cancelling, as the case may be, the certificate of registration of a dealer under sub-section

(4) of section 7 give him an opportunity of being heard in the matter.

(2) If the certificate of registration is proposed to be amended, the dealer shall forthwith produce to the notified authority the certificate of registration and the copies thereof, if any, granted to him, for haying them amended.

(3) If the certificate of registration is cancelled, the dealer shall forthwith surrender to the notified authority the certificate of registration and the copies thereof, if any granted to him.”

23. Sub-rule (1) of Rule 9 of the Rules of 1957 specifically provides for giving of an opportunity of being heard to a dealer in the matter by the notified authority before amending or cancelling certificate of registration under sub-section (4) of section 7 of the Act of 1956. Sub-section (4) of Section 7 of the Act of 1956 also says that where no such application has been made, after due notice to the dealer, the certificate of registration may be amended by the authority granting it if he is satisfied by reason to be recorded and satisfying that certificate of registration requires to be amended.

24. Provision under Section 49 (3) of the Act of 2005 also provides that Commissioner may on his own motion or on information received, considers that any order passed therein by person appointed under Section 3 is erroneous or prejudicial to interest of revenue, he may after giving opportunity of being heard and after causing such enquiry as he deems necessary, pass order.

25. From the facts and circumstances of present cases, as projected in WPT No.1/2021 and identical petitions, and also from the pleadings of respective parties, it is apparent that the petitioner had disputed issuance of proper notice under Section 49 (3) of the Act of 2005 to show cause as to why registration certificates of petitioner be not amended by deleting entries ‘mining activities’ and ‘high-speed diesel (HSD)’. Respondent State though pleaded that proper notice was issued and served through email, but copy of notice placed before this Court along with reply as Annexure R-2 is only with respect to Revision No.145 K.C.-1/20 (State). Meaning thereby, even if notice issued under Section 49 (3) of the Act of 2005 is with regard to amendment in registration certificate for deleting some entries i.e. mining activities and high speed diesel, from the registration certificate (Annexure P-7) issued in Form-11 under Rule 12 (1) of the Rules of 2006, which is registered under the Act of 2005, then there is no notice with respect to registration certificate issued in Form ‘B’ issued under Rule 5 (1) of the Rules of 1957, which is registered under the Act of 1956. Whereas, order impugned dated 14.10.2020 (Annexure P-1) decides two revision petitions bearings Nos.145 K.C.-1/20 (State) and 146 K.C.-1/20 (Central).

26. From the above facts and discussions, it is apparent that respondent Department had suo motu decided revision No.146 K.C. – 1/20 (Central) without issuing notice and without giving opportunity of being heard to registered dealer i.e. petitioner herien, which is mandatory under the provisions of Section 49 (3) the Act of 2005 and Rule 9 of the Rules of 1957.

27. If provision under Section 49 (3) of the Act of 2055 is read conjointly with Rule 9 of the Rules of 1957, the intent of Statute is to give opportunity of being heard is made mandatory. Hon’ble Supreme Court in case of Sahara India (Firm) Lucknow, reported in (2008) 14 SCC 151 has held as under:-

“32. The upshot of the entire discussion is that the exercise of power under Section 142 (2-A) of the Act leads to serious civil consequences and, therefore, even in the absence of express provision for affording an opportunity of pre-decisional hearing to an assessee and in the absence of any express provision in Section 142 (2-A) barring the giving of reasonable opportunity to an assessee, the requirement of observance of principles of natural justice is to be read into the said provision. Accordingly, we reiterate the view expressed in Rajesh Kumar case².

28. In view of discussions made in preceding paragraphs, this Court is of the view that the order impugned with respect to suo motu revision No.146 K.C.-1/20 (Central) is passed in violation of provisions of the Act of 2005 as also the Rules of 1957 as no notice under Section 49 (3) of the Act of 2005 was issued giving opportunity of hearing to registered dealer before amending registration certificate issued in Form-B under Rule 5 of the Rules of 1957 by deleting entries made thereunder. Hence, in the opinion of this Court there was violation of principles of natural justice. This being the position, the impugned order is liable to be and is hereby quashed.

29. Similar pleas, as raised in WPT No.1/2020, have been raised by petitioner in WPT No.99/2020. In this case also respondent State has filed copies of two notices along with its reply, which are at Page No.22 & 23 of reply. Notice at Page No.22 of reply bears Despatch No in Revision Case No.153/ which is under Section 49 (1) of the Act of 2005. Notice  vailable at Page No.23 of reply of the State bears same despatch as mentioned in notice at page no.22, and at the top of this notice the words ‘ is mentioned and provision is manually corrected from “49 (1)” to “49 (3)”. No other show-cause notice is filed by respondent State. Hence, the order dated 14.10.2020 (Annexure P-1)passed in Revision Case No.153/ and Revision Case No.154/ is liable to be and is hereby quashed.

30. Petitioner in WPT No.106/2020 has also raised identical grounds as raised in WPT No.1/2021. In this case also respondent State has filed Annexure R-2 along with return, which are copies of notices, purported to be under  ection 49 (3) of the Act of 2005, mentioning at the top as amended notice. Desptach number of the said notice is the same as is mentioned in notice under Section 49 (1) of the Act of 2005 in Revision Case No.and the amended notice is also for the same revision case. Respondent State has not placed any notice issued under Section 49 (3) of the Act of 2005 for Revision Case No. Hence, the rder impugned dated 12.10.2020 (Annexure P-1) is hereby quashed.

31. WPT No.111/2020 is an offshoot of WPT No.106/2020 as after amending registration certificate under the Act of 1956, respondent Department had issued notice dated 29.10.2020 for recovery of tax with penalty on petitioner vide order dated 29.10.2020 passed in Case No.1/2020 Central, under Section10A of the Act of 1956. As WPT No.106/2021 filed by this petition challenging the order dated 12.10.2020 (Annexure P-11 to writ petition) amending registration certificate of petitioner by deleting entries ‘mining’ and ‘HSD’ has been allowed by this Court and order dated 12.10.2020 has been quashed, therefore, consequential order of demand of tax including penalty (Annexure P-1) are also liable to be quashed and the same are hereby quashed.

32. The challenge in WPT No.2/2021 is to the order dated 15.10.2020 passed under Section 10A of the Act of 1956 of recovery of tax with penalty consequent to amendment in registration certificate under the Act of 1956. Subject matter of WPT No.1/2021 is the basis for initiating proceedings under Section 10A of the Act of 1956. As WPT No.1/2021 has already been allowed, quashing the order dated 14.10.2020 (Annexure P-16 to this petition), therefore, consequential order of demand of tax including penalty is also liable to be quashed and the same are hereby quashed.

33. Challenge in WPT No.103/2020 is to the order dated 12.10.2021 (Annexure P-1) by which respondent Department deleted entry ‘mining’ and ‘HSD’ from registration certificate (State) and registration certificate (Central). Petitioner in this petition has also raised similar grounds as raised in WPT No.1/2021. Respondent Department along with its reply filed amended notice as Annexure R-2. Amended Notice is of same despatch number of State and provision of Section 49 (1) is also corrected by hand as Section 49 (3). Case number mentioned in show-cause notice is Respondent State has not filed any other copy of show-cause notice under Section 49 (3) for Revision Case No.As both the revisions have been decided jointly by impugned order dated 12.10.20250 (Annexure P-1), therefore, it is not sustainable for want of proper notice as held in other connected writ petitions and is liable to be quashed. Hence, the order impugned is hereby quashed.

34. Petitioner in WPT No.110/2020 has challenged the order dated 12.10.2020 (Annexure P-1) challenging deletion of entries from registration certificate (State) and registration certificate (Central). Petitioner in this petition has also raised similar grounds as raised in WPT No.1/2021. Respondent Department along with its reply filed only one notice as Annexure R-2 with the title ‘amended notice’ written by hand and correcting provision from Section 49 (1) to Section 49 (3). This notice is issued in respect of Revision Case No. Whereas, order impugned is passed in respect of two revisions i.e. Revision Case No. and Revision Case No. Show cause notice under Section 49 (3) with respect to Revision Case No. is not stated to be issued nor placed on record by learned counsel for the State. Hence, the order impugned dated 12.10.2021 is liable to be and is hereby quashed.

35. The order under challenge in WPT No.112/2020 is passed consequent to amendment in registration certificate of the petitioner. Subject matter of WPT No.110/2021 is the basis for initiating proceedings under Section 10A of the Act of 1956. As WPT No.110/2021 has already been allowed, quashing the order dated 14.10.2020 (Annexure P-16 to this petition), therefore, consequential order of demand of tax including penalty is also liable to be quashed and the same are hereby quashed.

36. In the result, all writ petitions stand allowed.