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M/S SUBHLAXMI RICE MILLS PVT.LTD. THRU' DIRECTOR versus THE COMMISSIONER OF TRADE TAX, U.P. LUCKNOW

High Court of Judicature at Allahabad

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M/S Subhlaxmi Rice Mills Pvt.Ltd. Thru' Director v. The Commissioner Of Trade Tax, U.P. Lucknow - SALES/TRADE TAX REVISION No. 1153 of 2006 [2006] RD-AH 20704 (7 December 2006)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

Court no.22

TRADE TAX REVISION NO.1153 of 2006.

M/S Subhlaxmi Rice Mills Pvt. Ltd., Mainpuri.    Applicant

Versus

The Commissioner, Trade Tax, U.P. Lucknow.                                  Opp.Party.

Hon'ble Rajes Kumar, J.

Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 31st December, 2005 relating to the assessment year, 1998-99.

The applicant was engaged in the manufacture and sales of rice. Paddy is the raw material. Paddy was liable to tax at the point of first purchase under section 3-D of the Act. Applicant purchased the paddy and paid the tax being first purchaser and out of the paddy manufactured rice. During the year under consideration, applicant has sold rice to RFC for Rs. 1,17,42,042/- during the period 1.4.1998 to 22.12.1998 and for Rs.76,79, 298.70 during the period 23.12.1998 to 31.3.1999. For the aforesaid period, rice was admittedly liable to tax at the rate of 2.8 percent and 3.2 percent respectively in the hand of the applicant. The total liability of tax on the aforesaid sales to RFC was Rs.5,74, 514.71. Under section 15 (c) of the Central Sales Tax Act, applicant was entitled for the adjustment of the amount of tax paid on paddy with the amount of tax payable on the sales of rice. Assessing authority has calculated a sum of Rs. 3,50,070/- the amount of tax paid on paddy used in the manufacturing of rice sold to RFC and accordingly, allowed the adjustment of Rs.3,50,070/- with the amount of tax of Rs.5,74,514.72 payable on the sale of RFC. The total amount of tax payable on the sale of RFC was held at Rs. 2,24,444.72. Applicant realized the tax from the RFC to the extent of Rs.4,44,844.40 and accordingly claimed refund of Rs.2,20,399.68. Refund was refused by the assessing authority and the amount has been forfeited under section 29 (2) of the Act. Applicant filed appeal before the Joint Commissioner (Appeals). Joint Commissioner (Appeals) allowed the appeal and has allowed the refund of Rs.2,20,400/-. In the appeal filed by the Commissioner of Trade Tax, the order of the Joint Commissioner (Appeals) has been reversed and the order of the assessing authority refusing to refund the amount of Rs.2,20,339.68 forfeiting the aforesaid amount has been upheld.

Heard learned counsel for the parties.

Learned counsel for the applicant submitted that the applicant has paid the tax on the amount of paddy from its own account. He submitted that in fact, the applicant was entitled to recover the amount from RFC to the extent of Rs. 5,74,514.72, the amount of tax payable on the sale turnover of rice to RFC. In this way the applicant has realized lesser tax from the RFC and not the excess tax. He further submitted that the amount of Rs.2,20,339.68 has become excess amount because the applicant has paid the tax on the purchases of paddy, therefore, the excess amount should be returned to the applicant as the tax has been paid on the paddy, it cannot be treated as excess realization of tax from RFC.

Learned Standing Counsel submitted that there is no provision for giving the refund of the amount of tax paid on the paddy. Under section 15 (c) of the Central Sales Tax Act, dealer is entitled for the adjustment of the amount of tax paid on the paddy with the amount of tax payable on the sale of the rice and after giving adjustment of the tax paid on the paddy at Rs. 3,50,070/-, the amount of tax payable on the rice comes to Rs.2,44,444.72 paise, while it was found that the applicant had realized the tax from RFC to the extent of Rs.4,44,844.50, which was also deposited. Since the amount of Rs.2,20,399.68 realized from RFC, same was rightly forfeited under section 29 (2) of the Act and has been rightly upheld by the Tribunal.

Having heard the learned counsel for the parties, I have perused the order of the Tribunal and the authorities below.

I do not find any substance in the argument of the learned counsel for the applicant. Under section 15 (c) of the Central Sales Tax Act, dealer was entitled for the adjustment of the amount of tax paid on the paddy with the amount of tax payable on the rice. Liability of tax on the paddy was on the dealer being the first purchaser of the paddy. There is no provision for the refund of the amount of tax paid on the paddy. The provisions of Section 15 (c) of the Central Sales Tax Act provides adjustment of the amount of tax paid on the paddy with the amount of tax payable on the turnover of rice. After the adjustment of the amount of tax paid on the paddy at Rs. 3,50,070/-, the amount of tax payable on the sale of rice to RFC comes to Rs.2,44,444.72 paise. Since the applicant has realized a sum of Rs. 4,44,844.40 from RFC, the balance amount of Rs.2,20,399.68 was not refundable to the applicant in view of Section 29 (2) of the Act. It is only refundable to RFC under section 29 (3) of the Act. Thus, the Tribunal has rightly upheld the order of the assessing authority refusing to allow the refund of Rs.2, 20,399.68 to the applicant.

In the result, revision fails and is, accordingly, dismissed.

Dated.07.12.2006.

VS.


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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