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Judgment
Heard learned counsel for the petitioner and learned counsel for the State.
The petitioner deals in purchase and sale of Yamaha make motorcycles and spare parts within the State of Jharkhand, for which, the petitioner was
liable for payment of Jharkhand Value Added Tax, which came in force in the State on 01st April, 2006. Prior to coming into force of Jharkhand
Value Added Tax Act, (herein after referred to as the 'JVAT Act'), admittedly, the petitioner was subject to tax liability under the Bihar Finance Act,
1981. Upon coming into force of JVAT Act, Section 20 of the JVAT Act provided as follows :-
Input Tax Credit on the Closing Stock of Registered Dealers prior to Appointed date. - Full input tax credit shall be allowed in the manner
prescribed for goods purchased on and after 1.4.2005 and which have borne the incidence of tax under the provisions of adopted Bihar Finance Act,
1981 Part I, and held as closing stock on the Appointed Day and are sold or re-sold thereafter against the current VAT liability, or consume such
goods in the manufacture of taxable goods which are sold against the current VAT liability and or consume such goods for direct use in mining.
Rules were also framed by the State of Jharkhand, being Jharkhand Value Added Tax Rules, 2006, (herein after referred to as the 'JVAT Rules'),
Rule 26 (1) (b) & (f) which, reads as follows :-
Computation of Input Tax Credit.- (1) Input tax credit on the opening stock of the tax paid goods purchased between 1.4.2005 and Appointed
Day-
After the commencement of the Act, where any dealer registered as a VAT dealer or where the authority prescribed registers any dealer as a VAT
dealer under Rule 3, such dealer shall be eligible for Input Tax Credit as provided under Section 20 of the Act. The goods on which the input tax credit
is claimed and allowed shall be available as on the Appointed Day, on stock of tax paid goods excluding the goods mentioned in Part-E of Schedule-II
of the Act and shall be admissible within nine months from the appointed date on the following conditions-
(a) ----------------.
(b) The VAT dealer claiming input tax credit, shall make an inventory of all goods in hand, on the Appointed Day, which has suffered the incidence of
tax under the Repealed Act, and shall file his claim for Input Tax Credit in Form JVAT 401 along with the evidences, including the statement of
purchase or sale invoice(s) or copies of the Declaration(s) in form IX-C issued /received under the Repealed Act.
(c) ----------------.
(d) ----------------.
(e) ----------------.
(f) The claim for such input tax credit shall be filed before the prescribed authority, within a period of thirty days from the date of commencement of
the Act. The claim of such input tax credit shall be verified and allowed in Form JVAT 402, not later than a period of eight months, from the date of
receipt of Form JVAT 401.
*** *** ***.
The petitioner, herein, is aggrieved by the fact that even though in Section 20 of the JVAT Act, there was no provision for fixation of any limitation
period for filing the form JVAT-401, Rule 26(1) (f) of the JVAT Rules provided for the period of thirty days for filing the form JVAT-401 along-with
the evidences. Accordingly, the vires of Rule 26(1) (f) of the JVAT Rules, is challenged in the present writ application.
Admittedly, the petitioner had submitted the form JVAT-401 on 18.05.2006, i.e., after the delay of 17 days. In spite of the form JVAT-401
submitted after 17 days, the claim of the petitioner was considered by the Deputy Commissioner of Commercial Taxes, Jamshedpur Circle,
Jamshedpur, by his order dated 18th October, 2006, as contained in Annexure-5 to the writ application, and it was found that the claim of the petitioner
for adjustment as input tax credit, to the extent of Rs. 2,36,538/-was acceptable, and the petitioner was entitled for issuance of form JVAT-402. The
said form JVAT-402 was however, never issued to the petitioner and the Assessing Authority, i.e., the Deputy Commissioner, Commercial Taxes,
Jamshedpur Circle, Jamshedpur, who had earlier issued the order dated 18.10.2006, rejected the claim of the petitioner, only on the ground that form
JVAT-402 was not issued to the petitioner, and imposed the liability of interest as well as penalty upon the petitioner.
Upon appeal, the Appellate Authority also upheld the order, against which, the petitioner moved before the Commercial Taxes Tribunal, Ranchi,
which also upheld the order. A review was also filed on the ground that the same authority had earlier accepted the claim of the petitioner and had
found it entitled for issuance of form JVAT-402, but subsequently, the claim was rejected and interest and penalty were imposed, but the review
petition was also rejected by the Commercial Taxes Tribunal. Aggrieved thereby, the present writ application has been filed, in which the petitioner
has challenged the vires of Rule 26 (1) (f), claiming that either under Section 20, or under Section 94 of the JVAT Act, there was nothing to empower
the State to frame the Rules regarding the period of limitation.
Though the learned counsel for the petitioner has relied upon certain decisions of the Hon'ble Apex Court on the point, but in view of the admitted
position that after coming into force of GST regime, the JVAT Act and the Rules framed there under, have already been repealed and they are no
more in force, we are of the considered view that no useful purpose is going to be served by deciding the vires of the Rules, which is no more in force.
The fact, however, remains that upon verification of form JVAT-401 submitted by the petitioner, the competent authority had considered the same
on merits, and had found the claim of the petitioner to be genuine and acceptable to the tune of Rs.2,36,538/-, and had directed for issuance of form
JVAT-402. The claim of this petitioner was subsequently rejected only on the ground that form JVAT-401 was submitted belatedly.
In the peculiar facts of the case, since there appears to be delay of only 17 days, and we also find that there was no default on the part of the
petitioner in the payment of the tax and the claim of the petitioner was also found to be genuine, we set aside the order dated 14th February, 2009,
passed by the Deputy Commissioner, Commercial Taxes, Jamshedpur Circle, Jamshedpur, as contained in Annexure-6 to the writ application, as also
the subsequent Appellate and the Revisional orders passed by the Appellate Authority and the Commercial Taxes Tribunal, Ranchi, as contained in
Annexures-8, 10 and 13 to the writ application. We also set aside the demand notice issued on 17.02.2009, as contained in Annexure-7 to the writ
application.
The matter is remanded back to the Deputy Commissioner, Commercial Taxes, Jamshedpur Circle, Jamshedpur, for re-examining the claim of the
petitioner, treating the form JVAT-401 submitted by the petitioner, to be within time. We also direct that the exercise shall be completed by the
Deputy Commissioner, Commercial Taxes, Jamshedpur Circle, Jamshedpur, within a period of three months from the date of communication of this
order.
This writ application is accordingly, allowed with the directions as above.