Case Law Details

Case Name : M/s. J. K. Lakshmi Cement Limited Vs State of Rajasthan (Rajasthan High Court at Jodhpur)
Appeal Number : S.B. Civil Writ Petition No. 6501/2020
Date of Judgement/Order : 11/08/2020
Related Assessment Year :

J. K. Lakshmi Cement Limited Vs State of Rajasthan (Rajasthan High Court at Jodhpur)

Rajasthan High Court Grants Interim Relief to J.K. Lakshmi Cement Ltd. From Being Exposed To High Tax Demand Under Rajasthan VAT Act And Central Sales Tax Act.

Anti Evasion Commercial Tax Department of State of Rajasthan issued Notices for assessing and reassessing for 6 Financial Years to the cement manufacturing company, JK Lakshmi Cement Ltd. for reopening of the assessment for Financial Years 2014-15, 2015-16, 2016-17, 2017-18, 2018-19,2019-20 under Rajasthan Value Added Tax,2003 and Central Sales Tax Act, 1956. The Commercial Tax Department issued Notices to the Company on 05.03.2020 and 06.06.2020 for different financial years while considering the issuance of Diesel to its work agencies to be sale under the Act and on that pretext, the Company be imposed with huge and humongous tax, interest and penalty, thereupon, for alleged the sale consideration received by company.

Being aggreived, the Company preferred writ petitions before the Rajasthan High Court at Jodhpur while assailing the validity of Notices issued by the Tax Department which are in due ignorance of law and with legal mala fide and ignoring the earlier concluded assessment for same financial  years.

Senior Advocate Mr. Ravi Bhansali assisted by Mr. Ramit Mehta and Mr. Saurabh Maheshwari appeared for the petitioners and advanced arguments that the Notices under challenge are without jurisdiction and on misconceptions of the Department. The petitioner company provides Diesel to the work agencies under arrangement and does not charge any single amount for the same.The Department has wrongly and without any material evidence concluded in Notice that the petitioner company makes sale to other business entities while collecting consideration. It was specifically argued that the petitioner company does not charge and collect even a single penny and thus, it is grossly wrong on part of the Department to assume such arrangement to be Sale and reopen the settled assessment while imposing tax, interest and penalty.

The Hon’ble Court heard arguments on behalf of petitioner of bunch of the writ petitions at length and vide order dated 11.08.2020, the Hon’ble Court duly stayed the effect and operations of the impugned notices while issuing notices to the Respondent arrayed in the writ petitions and matter be kept after 6 weeks.

The Hon’ble Court vide order dated 24.07.2020 in the matter of JK Cement Ltd. granted similar interim orders.


Learned counsel for the petitioner has submitted that in writ petition involving identical controversy being SBCWP No.5699/2020, a Co-ordinate Bench of this Court while issuing notices to the respondents has stayed the effect and operation of the impugned notices whereby, the Department has proposed to reopen the already assessed cases of the petitioner-company for the years 2015-16.

Issue notice. Issue notice of the stay application as well.

Notices are made returnable within six weeks.

Meanwhile, the effect and operation of the notices dated

5.3.2020 (Annex.9) and 6.6.2020 (Annex.10) shall remain stayed.

Connect with SBCWP No.5699/2020.

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October 2021