K.C.P. Ltd. And Ors. vs State Of M.P. And Ors.
- SCC(1998) 9 SCC 379
Ratio decidendi
The rule this decision rests on
Where a taxpayer contends that it has already paid Central sales tax on a transaction in one State and therefore should not be liable to pay State sales tax on the same transaction in another State, a stay of collection of the State sales tax may be granted pending determination of the appeal before the Appellate Commissioner, provided the taxpayer satisfies the authorities that Central sales tax was paid on the same transaction in the other State, and a stay of penalty shall also be granted in the meantime. Where such an appeal is decided against the taxpayer and a further appeal is filed before the Board of Revenue, all necessary parties, including both States whose tax claims are in dispute, must be joined so that the Board may adjudicate the dispute between the States; the procedure established in Ashok Leyland Ltd. v. Union of India must be followed in such circumstances, and the stay of collection shall continue on the same terms until the Board of Revenue decides the appeal after hearing all parties.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1. Leave granted. We have heard Shri K. Parasaran, learned Senior Counsel for the appellants and Shri K.N. Shukla, learned Senior Counsel for the contesting respondents-State authorities.
2. Looking to the contention of the appellants that the State of Tamil Nadu has already recovered Central sales tax for the same transaction from them and therefore they are not liable to pay the State sales tax to State of M.P. for the same transaction and therefore, the assessment made by the authorities of the State of M.P. would be liable to be set aside, we find that as the appellants themselves have gone in appeal before the Appellate Commissioner of Sales Tax, till that appeal is decided it is just and proper to order that there shall be stay of collection of the M.P. State sales tax from the appellants provided the appellants satisfy the authorities concerned of the State of M.P. that in respect of the same transaction it had paid the Central sales tax in the State of Tamil Nadu. There will be stay of penalty also in the meantime.
3. It is obvious that if the appeal before the Appellate Commissioner gets decided against the appellants and if the appellants have to file a further appeal before the Board of Revenue, they will have to join all necessary parties for thrashing out this problem before the Board which will adjudicate the dispute between the two States, namely, State of M.P. on the one hand and the State of Tamil Nadu on the other hand and under these circumstances, the procedure laid down by this Court in its decision reported in Ashok Leyland Ltd. v. Union of India, will have to be followed. If such an appeal gets filed before the Board of Revenue and all necessary parties are joined, then the present order of stay will continue on the same terms and conditions till that appeal also is decided by the Board of Revenue after hearing all the parties concerned.
4. As rightly suggested by learned Senior Counsel for the respondent authorities the appellate authority is directed to dispose of the pending appeal as expeditiously as possible and preferably within a period of three months from today.
5. The appeal is disposed of accordingly. No costs.
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