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224 Goods & Services Tax Cases - Reports [Vol. 1 Kashmiri Lal Goyal and Sandeep Goyal for the Appellant. Piyush Kant Jain for the Respondent. JUDGMENT M.M. Kumar, J. - This appeal filed under section 68 of the Punjab Value Added Tax Act, 2005 (for brevity, ‘the VAT Act’) challenges order dated 17-11-2008 passed by the Value Added Tax Tribunal, Punjab, Chandigarh (for brevity, ‘the Tribunal’) in Appeal No. 511 of 2005-06, in respect of assessment year 1993-94. 2. Brief facts necessary for disposal of the controversy raised in the instant appeal are that the dealer-appellant is engaged in the manufacturing of bus bodies on the chassis as per design, specifications and seating capacity supplied by its customers. It has been claimed that the dealer-appellant neither making bodies for sale nor keeps the same in stock. It also undertook the repair work and resale of iron and steel. 3. On 16-9-1998, a surprise checking was conducted by the officers of the revenue on the premises of the dealer-appellant. A detailed show-cause notice, dated 8-10-1998, was issued by the Assessing Authority directing the dealer-appellant to produce requisite documents such as cash book, ledger, purchase vouchers, balance sheet with profit and loss account, bill books, trading account etc. and purchase orders for the years 1993-94 to 1997-98. These proceedings eventually culminated into passing of an assessment order dated 27-7-1999 (A-2) in respect of assessment year 1993-94. The Assessing Authority raised an additional demand of Rs. 25,13,809 under the provisions of the Punjab General Sales Tax Act, 1948 (for brevity, ‘PGST Act’). Against the order dated 27-7-1999, the dealer-appellant preferred an appeal under section 20(5) of the PGST Act. The Deputy Excise and Taxation Commissioner (Appeals), Jalandhar Division, Jalandhar (DETC), vide order dated 21-9-1999 directed the dealer-appellant to deposit Rs. 17 lakhs by 14-10-1999 and to produce the Treasury receipt on 15-10-1999 before him. Against the said order, the dealer-appellant filed an appeal before the Tribunal, which directed him to deposit Rs. 1 lakh by 15-5-2000 and to appear before the DETC. The dealer-appellant could not deposit the requisite amount and filed an application for extension of time for deposit of the amount. The Tribunal extended the time up to 1-1-2001 and directed the dealer-appellant to appear before the Appellate Authority on 8-10-2001. The amount was deposited and the Appellate Authority remanded the matter to the Assessing Authority to afford an opportunity to the dealer-appellant to produce evidence and to pass fresh assessment order, vide order dated 28-1-2002 (A-3). 4. On 18-9-2002, the Assessing Authority again passed an assessment order. This time no demand under the PGST Act was raised but a demand of Rs. 5,70,080 under the Central Sales Tax Act, 1956 (for brevity, ‘CST Act’) was raised (A-4). A sum of Rs. 4,68,458 as penalty and interest under sections 10(6) and 11D read with section 9 of the CST Act, was also GOODS & SERVICES TAX CASES ❑ JANUARY 20 - FEBRUARY 4, 2010 ◆ 100 A B C D E F G
2010] New Model Industries (P.) Ltd. v. State of Punjab (Punj. & Har.) 225 A B C D E F G imposed. The dealer-appellant filed two appeals one under section 20(10)(a) of the PGST and the other under section 9(2) of the CST Act read with section 20(1)(a) of the PGST Act. On 11-1-2005 (A-4/A), the Appellate Authority again remanded the matter back to the Assessing Authority for passing a speaking order after verifying the facts as per the directions given in the earlier remand order dated 28-1-2002. 5. On 28-3-2005, the Assessing Authority again passed fresh assessment orders under the PGST Act and determined the gross sales of the dealerappellant at Rs. 2,16,66,610. After placing reliance on ‘D’ Forms, the Assessing Authority came to the conclusion that there was sale of motor vehicle bodies and the transactions were not of work contract as claimed by the dealer-appellant. It was further held that the sales were completed within the State and, thus, liable to sales tax under PGST Act. Accordingly, demand of Rs. 6,92,988 towards tax was raised and penalty of Rs. 5 lakhs under section 10(7) of the Act was imposed (A-5). The appeal preferred by the dealer-appellant against order dated 28-3-2005, was dismissed by the Appellate Authority vide order dated 27-12-2005 (A-6). 6. Against the order dated 27-12-2005 (A-6), the dealer-appellant preferred further appeal before the Tribunal along with an application for entertaining the appeal without prior payment of demand. The Tribunal vide order dated 17-11-2008 disposed of the appeal holding the dealer-appellant liable to pay the tax due as shown in the order dated 28-3-2005 passed by the Assessing Authority. However, it has set aside the penalty of Rs. 5 lakhs under section 10(7) of the Act (A-9). 7. At the hearing, Mr. K.L. Goyal, learned senior counsel for the dealerappellant has raised the following two questions of law for determination of this Court :— 1. Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the erection of body on the chassis would amount to sale, contrary to the judgment of Hon’ble the Supreme Court in State of Gujarat v. Variety Body Builders [1976] 38 STC 176? 2. Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that there would be no effect with regard to tax liability of the dealer even if the transaction is held to be inter-State sale? 8. The first question of law does not survive as it has already been answered against the dealer-appellant by Hon’ble the Supreme Court in the case of CCT v. M.G. Bros. [1975] 35 STC 24. Confronted with the aforesaid situation, Mr. K.L. Goyal, learned senior counsel could not point out any distinguishing feature in the case in hand. Accordingly, the first question is answered against the dealer-appellant. 9. In respect of the second question, Mr. Goyal has argued that once it is certain that the goods were to move outside the State of Punjab then the GOODS & SERVICES TAX CASES ❑ JANUARY 20 - FEBRUARY 4, 2010 ◆ 101
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