Case: ALD AUTOMOTIVE PVT LTD Vs. THE COMMERCIAL TAX OFFICER AND ORS NOW UPGRADED AS THE ASSISTANT COMMISSIONER (CT)


Decision reasoning: 1[ds]27. The ground on which Rule 6 was held as ultra vires has been clearly noticed by this Court in paragraph 6 as noticed above. It is relevant to notice that in the same paragraph this Court had noticed Section 13(4)(g) of the Act where the State was empowered to make rule with regard to the time. Thus, this Court noticed the contradiction in phraseology of Section 8 sub-Section (4) and Section 13 sub-section (4) and held that non-mention of time in Section 8(4) is for clearly denying the rule making power to make any rule pertaining to the time. Thus, the above case has no bearing in the present controversy, since, in the present case the time period is prescribed in Section 19(11) itself which is a part of the Act and has to be read with Section 3 sub-section (3).The above case also does not come to help the appellant in the present appeal. In the above case there was no case that manufacturer does not fulfill any essential eligibility to obtain MODVAT credit on the additional duty paid by the manufacturer. The amendment which was made effective w.e.f. 15.04.2017 providing availability of MODVAT credit on additional duty paid was held to be clarificatory, hence, did not affect the right of MODVAT credit. The above case was thus on its own facts.The Constitutional validity of Section 19(20) was upheld. The above decision is a clear authority with proposition that Input Tax Credit is admissible only as per conditions enumerated under Section 19 of the Tamil Nadu Value Added Tax Act, 2016. The interpretation put up by this Court on Section 3(2) and 3(3) and Section 19(2) is fully attracted while considering the same provisions of Section 3(2) and 3(3) and provision of Section 19(11) of the Act. The Statutory scheme delineated by Section 19(11) neither can be said to be arbitrary nor can be said to violate the right guaranteed to the dealer under Article 19(1) (g) of the Constitution. We thus do not find any infirmity in the judgment of the High Court upholding the validity of Section 19(11) of the Act. Both the issues are answered accordingly.Issue Number 3 and 4The alternative submission pressed by learned Counsel for the appellant was that Section 19(11) cannot be held to be mandatory and it is only a directory provision, non-compliance of which cannot be ground of denial of Input Tax Credit to the appellant. The conditions under which Input Tax Credit is to be given are all enumerated in Section 19 as noticed above. The condition under which the concession and benefit is given is always to be strictly construed. In event, it is accepted that there is no time period for claiming Input Tax Credit as contained in Section 19(11), the provision become too flexible and give rise to large number of difficulties including difficulty in verification of claim of Input Credit. Taxing Statutes contains self-contained scheme of levy, computation and collection of tax. The time under which a return is to be filed for purpose of assessment of the tax cannot be dependent on the will of a dealer. The use of word ‘shall? in Section 19(11) does not admit to any other interpretation except that the submission of Input claimed cannot be beyond the time prescribed. Section 19(11), in fact, gives additional time period for claim of Input Credit. The Statutory scheme contemplates filing of the timely return before 20th of the succeeding month.Section 19(11) thus allowed an extended period for Input Credit which if not claimed in any month can be claimed before the end of the financial year or before the 90 days from the date of purchase whichever is later. The provision of Section 19(11) is thus an additional benefit given to dealer for claiming Input Credit in extended period. The use of word ?shall make the claim? needs no other interpretation.This Court in the above case clearly laid down that whether particular provision is mandatory or directory has to be determined on the basis of object of particular provision and design of the statute. The period of 10 days in submitting the report of the public analyst was held to be directory for the reason that on the negligence of those to whom public duties are entrusted no one should suffer. Such interpretation should not be put which may promote the public mischief and cause public inconvenience and defeat the main object of the statute. The interpretation of the Rule 9(j) in the above case was on its own statutory scheme and has no bearing in the present case. We, thus, are of the view that time period as provided in Section 19(11) is mandatory.Issue no. 5the above case, the officials of the Central Government were exercising Revisional Jurisdiction as conferred under Section 33 of the Act to the Central Government.This Court in the above case held that the officer was exercising power of Central Government under Section 33 and had ample jurisdiction to set aside the Orders of the sub-ordinate authorities canceling the order and to permit the appellant to deposit the balance amount of the purchase money.The above case was thus on its own facts, this Court held that in exercise of residuary power of Central Government, it had jurisdiction to pass such order in relation thereto as in its opinion the circumstances in the case require. In the scheme of Tamil Nadu Value Added Tax Act, 2006, there is no power conferred on any authority under the Act to dilute the mandatory requirement under Section 19(11). The taxing statute has to be strictly construed. Nothing is to be read in, noting is to be implied and language used in taxing statute had to be looked into fairly. The benefits envisaged in the taxing statute had to be extended as per the restrictions and conditions envisaged therein. The statute having not given any indication for extension of time which is a condition for claiming Input Tax Credit, the submission that period could have been extended by assessing authority is unfounded and cannot be accepted. Issue number 5 is answered accordingly.