THE GUJARAT VALUE ADDED TAX TRIBUNAL AT AHMEDABAD.

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1 REGISTRATION Ab initio cancellation of R.C. Confirmed - Decision of L.G. Electrocnics 16 VST 361 (Delhi), Hindustan Construction 141 STC 119 (P&H), Shiv Shakti Corp. (2003) 6 SCC 659 and decisions on para 11 and relevant provisions discussed in details. IN THE GUJARAT VALUE ADDED TAX TRIBUNAL AT AHMEDABAD. Before: Hon. Mr. Justice K.A. Puj, President Shri Y.P. Bhatt, Member Shri N.A. Acharya, Member SECOND APPEAL NOS. 276 & 277 OF 2010 M/S Y.M. TRADERS... Appellant v/s THE STATE OF GUJARAT... Respondent Appearance Shri V.V. Ishani, the learned advocate for the Appellant Shri R.S. Parmar, the learned Govt. Agent for the Respondent REVISIONAL APPLICATION NOS. 49 & 50 OF 2012 M/S. SHAH ENTERPRISE... Applicant v/s The State of Gujarat... Opponent Appearance Shri Nishant Shukla, the learned advocate for the applicant and Shri Y. A. Radhanpura, the learned Govt. Agent for the opponent. Date: 05/06/2013 JUDGMENT Per Hon. Mr.Justice K.A. Puj, President:- The appellant namely M/s. Y.M. Traders has filed these two Second Appeals challenging the order passed by the learned Deputy Commissioner of Commercial Tax, Circle-19, Bhavnagar, on 30/01/2010 cancelling the registrations ab initio granted to the appellant under the Gujarat Sales Tax Act, 1969 (GST Act) as well as under the Central Sales Tax Act (CST Act), while exercising his powers under Section 27(5)(i) of the Gujarat Value Added Tax, 2003 (GVAT Act) as well as under Section 9(2) of the Central Sales Tax Act. 2. It is the case of the appellant in S.A. Nos. 276 & 277 of 2010 that the appellant is a proprietary concern, doing business of M.S. Pipe, Machinery, Scrap and the appellant is holding the registration no and with effect from 02/01/2004. It is also the case of the appellant that the appellant has been filing its quarterly VAT returns and challans regularly. The whole controversy arose when the learned Deputy Commissioner of Commercial Tax issued notice in Form No.104 and 503 on 11/06/2008, in response to which the authorised representative of the appellant remained present and submitted all the details and evidences called for, by him. The appellant has also furnished details of purchases made from six parties during the year and The learned Deputy Commissioner of Commercial Tax has, however, mentioned in his order that purchases made from these six parties were not genuine and they were indulging into the bogus billing activity. The appellant has, however, raised an issue that the learned Deputy Commissioner of Commercial Tax has not brought any material on record which would establish and show that the appellant has not made any genuine purchases and only on the basis of the cancellation of the registration numbers of the dealers from whom the appellant has made purchases, the appellant s registrations were cancelled ab initio. It is also the grievance of the appellant that the allegations made in the order are absolutely illegal, uncalled for, arbitrary and unjustifiable. The

2 conclusion drawn by the learned Deputy Commissioner of Commercial Tax on the basis of such vague allegations has resulted into the deprivation of the genuine dealer like the appellant from exercising his legitimate constitutional right of doing the business. Despite the fact that the appellant was holding registration numbers with effect from 02/01/2004, no details were furnished in respect of the years of and nor they were mentioned in the order passed by the learned Deputy Commissioner of Commercial Tax. It is, therefore, urged before this Tribunal that the order cancelling the registrations ab initio passed by the learned Deputy Commissioner of Commercial Tax is without any application of mind, absolutely unfair and bad in law and hence deserves to be quashed and set aside. 3. The applicant namely M/s. Shah Enterprise has filed these two revisional applications under Section 75 of the Gujarat Value Added Tax Act, 2003 challenging the order dated passed by the learned Deputy Commissioner of Commercial Tax, Circle-19, Bhavnagar under Section 27(5)(i) of the Gujarat Value Added Tax Act as well as under Section 9(2) of the Central Sales Tax Act whereby the registrations granted to the applicant both under the GVAT Act as well as under the CST Act were cancelled with retrospective effect. 4. It is the case of the applicant in R.A. Nos. 49 & 50 of 2012 that the applicant is a proprietorship concern and is registered as the dealer under the GVAT Act as well as under the CST Act. The applicant holds the registrations with effect from 04/06/2005 and 07/06/2005 both under the GST Act as well as under the CST Act respectively. The applicant had maintained regular books of accounts and keeps its accounts duly closed, adjusted and audited. The applicant files returns regularly in the department. The applicant is in the business of trading of ferrous and non ferrous metals, iron and steel products and scrap. The applicant was registered dealer till 30/11/2010. The applicant has made an application on 09/12/2010 in Form 103 seeking cancellation of registrations under both the Acts on the ground of closure of business with effect from 30/11/2010. Pursuant to the application of the applicant, the registrations were cancelled with effect from 30/11/2010 vide order of cancellation dated 07/07/ The applicant was thereafter served with a notice in Form 503 and Form 104 dated 19/04/2012 proposing to cancel the registrations of the applicant ab initio i.e. from the date of issue of registrations. The reason advanced for cancellation of registrations ab initio was that vendors of the applicant were engaged in billing activity. It was proposed to revise order of cancellation dated 07/07/2011 whereby the registrations of the applicant were cancelled with effect from 30/11/2010 on the basis of the application preferred by the applicant on 09/12/2010. In the said notices, the applicant was directed to remain present before the learned Deputy Commissioner of Commercial Tax, Division-19, Bhavnagar on 07/05/2012. However, due to some unavoidable circumstances, it was not possible for the applicant to remain present on 07/05/2012 and hence, an adjournment application was filed requesting to grant another date. The hearing thereafter was fixed on 08/06/2012 on which date the applicant remained present and submitted written submissions duly supported by the documents and it was urged by the applicant that the applicant had entered into the genuine transactions of sales and purchases. To the shock and surprise of the applicant, the learned Deputy Commissioner has passed an order on 16/08/2012 cancelling the registrations of the applicant under both the Acts retrospectively i.e. from the date on which they were issued i.e. 04/06/2005 and 07/06/2005 respectively. Simultaneously, the learned Deputy Commissioner of Commercial Tax has also modified the order dated 07/07/2011 cancelling the registrations of the applicant with effect from 30/11/2010. The said order was passed by the learned Deputy Commissioner while exercising his power under section 27(5)(i) and section 75 of the GVAT Act and section 67 of the GST Act read with section 100 of the GVAT Act. 6. Since similar issue is involved in many other matters, all other matters were heard together and the present Second Appeals and Revisional Applications are considered to be the lead matters and Mr. V. V. Ishani, the learned advocate appearing for the appellant in these two appeals as well as Mr. Nishant Shukla, the learned advocate appearing in Revisional Application Nos. 49 and 50 of 2012 in the case of M/s. Shah Enterprise have taken the lead to make their submissions. Both of them have made their detailed submissions orally as well as in writing. The submissions made by the other learned advocates in their respective matters were also taken into consideration before taking any final decision in the matters

3 and after conclusion of the submissions by all the learned advocates in their respective matters involving identical issue, all the matters were kept for order. 7. The first issue raised on behalf of the appellants was that after the repeal of the Gujarat Sales Tax Act and on an enactment of the GVAT Act, the Commercial Tax Officer has no jurisdiction to exercise powers of revision to revise the orders passed under the GST Act. In support of this proposition, it has been submitted that after the repeal of the GST Act, it is not permissible to initiate revision proceedings under the GVAT Act for the orders and periods pertaining to the GST Act. Despite there being Section 100 in GVAT Act dealing with repeal and saving clause, the same does not empower the initiation of altogether new proceedings. It only saves the right already acquired under the GST Act or any notice already issued under the GST Act. As per the provisions contained in Section 100, any provisions initiated under the GST Act or any notice issued under the GST Act would be deemed to have been issued under the GVAT Act. However, in the present case notice in form 503 for revision has been issued when the GST Act has already been repealed and replaced by the GVAT Act. The revision proceedings cannot be said to be continuous proceedings unlike appeal proceedings. The right of revision is not to be considered as acquired or substantive right. It is the right of appeal only which is required to be considered as accrued right and that right of appeal is acquired by the dealer right from the date on which it filed its return and such right is considered to be a substantive right acquired by the dealer. As against this, revision proceedings are altogether different from appeal proceedings and they are not saved by the repeal and savings clause either expressly or impliedly and hence they cannot be initiated after 01/04/2006 for the periods or orders for the periods prior to 31/03/2006. It is also submitted that mere right, existing on the date when the GST Act was repealed cannot be said to be accrued within the meaning of usual saving clause. In support of all these propositions, the appellants / applicants have relied on the decisions of Hon ble Delhi High Court in the case of L.G. Electronics (India) Ltd. Vs. Comm. Of Trade and Taxes, 16 VST 361 (Delhi) and Hindustan Construction Co. Ltd. Vs. State of Haryana and Others 141 STC 119 (P&H) 8. Based on the aforesaid decisions as well as considering the provisions contained in Section 100 of the GVAT Act, it has been submitted that the repeal and savings clause under the GVAT Act saves only the proceedings for which the notice has already been issued before the appointed day i.e. before 01/04/2006. It is, therefore, submitted that the proceedings for which the notice is issued after 01/04/2006 are not saved by the repeal and saving clause and hence the revisional proceedings are without jurisdiction. 9. A question was also posed for the consideration of this Tribunal as to why the power of revision should be curtailed when the Department carries out the assessment proceedings after the implementation of the GVAT Act for the periods under the GST Act. In this connection, it is submitted that under the GST Act, there is no provision like self-assessment unlike the GVAT Act. As per section 41 of the GST Act each and every dealer is required to be assessed either by accepting returns under Section 41(2) or on scrutiny of books of accounts under Section 41(3) or to the best of the judgment of the learned assessing authority under Section 41(4) or (5) or URD assessment under Section 41(6) or for not applying proper accounting method or for not maintaining proper books of accounts under Section 41(7). Hence, in any case the dealer is required to be assessed by the learned assessing authority and the order with respect to the same is required to be passed. Thus, the right of assessment is an accrued / acquired right under the GST Act and it is saved by the repeal and savings clause. However, the same is not true in the case of revisional proceedings. Right of revision cannot be considered as accrued right or substantive right. After the repeal of the GST Act, the right which was extinguished / destroyed cannot be exercised unless the proceedings to exercise that right have been initiated on or before 31/03/2006. It is, therefore, contended that the impugned order cancelling the registrations ab initio is nothing but an exercise of revisional power which is not saved and hence the said order is absolutely illegal and without jurisdiction. The Hon ble Apex Court in the case of M/s. Shiv Shakti Coop. Housing. Society Vs. Swaraj Developers (2003) 6 SCC 659 has clearly held that right of revision is not a substantive right. 10. It is further submitted that the revision is not a right and even if it is a right, it is not an accrued right. The concerned authority is vested with an extraordinary jurisdiction of revision and the said

4 jurisdiction is required to be acquired. The jurisdiction of revision cannot be acquired in each and every case as it is extraordinary jurisdiction and it has to be exercised cautiously. Section 100 of the GVAT Act does not contain the word Revision. It contains the word assessment, re-assessment etc. but it does not contain revision. The intention of the legislature is therefore very clear and the word revision is consciously not incorporated in the impugned provision. This omission on the part of the legislature to incorporate the word revision clearly satisfies the condition that if different intention appears or is inconsistent, in that case, the revisional proceedings cannot be initiated by taking resort to provisions of a repealed Act. 11. It is, further, submitted that the language employed in a statute is the determinative factor of legislative intent and the intention of the Legislature is primarily to be gathered from the language used, which means that attention should be paid to what has been said as also to what has not been said. The Court cannot add or amend and by construction make up deficiencies which are left there. For these propositions, reliance is placed on the following decisions. (1) M/s. Shiv Shakti Coop. Hsg. Society vs. Swaraj Developers (2003) 6 SCC 659. (2) Union of India and Others Vs. Dharmendra Textile Processors and others - 18 VST 180 (SC) (3) Orient Traders Vs. Commercial Tax Officer, Tirupati 13 V ST 530 (SC) (4) Trutuf Safety Glass Industries Vs. Commissioner of Sales Tax, UP 8 VST 661 (SC) (5) Orient Paper & Industries Ltd, Vs. State of M.P. and others 148 STC 649 (SC) (6) Tata Cummins Ltd Vs. State of Jharkhand and others 148 STC 190 (Jharkhand) confirmed in 148 STC 199 (SC). (7) Vikrant Tyres Ltd Vs.First Income-tax Officer, mysore 127 STC 5 (SC) (8) J & J Timbers Vs. Intelligence Officer, - 21 VST 377 (Kerala) (9) Nagarajan K.V. Vs. Deputy Commercial Tax Officer, - 7 VST 585 (Madras) (10) Shakti Hill Resorts Pvt. Ltd Vs. Addl. Commissioner of Commercial Taxes, 5 VST 412 (Karnataka) (11) National Hydroelectric Power Corporation Ltd. Vs. State of Manipur and others 134 STC 113 (Gauhati). 12. It has been further submitted that Repeal and Savings Clause contained in Section 100 of the GVAT Act saves the rights already accrued and acquired. Since the revision is not an accrued or acquired right, it is not saved by Section 100 of the GVAT Act. It has also been submitted that on plain reading of Section 100 it is clearly established that different intention does not appear with respect to saving of revisional proceedings. In this regard, reference was made to Section 6 of the General Clauses Act, As per the provisions contained in Section 6 of the General Clause Act, when there is repeal of a statute accompanied by re-enactment of a law on the same subject, the provisions of the new enactment would have to be looked into not for the purpose of ascertaining whether the consequences envisaged by Section 6 of the General Clauses Act ensued or not. Section 6 would indeed be attracted unless the new legislation manifests a contrary intention. Since Section 100 of the GVAT Act does not contain word revision or it merely contain the words assessment, reassessment etc. the intention of the Legislature is very clear because the word revision is consciously not incorporated in the impugned provision of Section 100. This omission on the part of the Legislature clearly satisfies the condition that if different intention appears or is inconsistent in the new enactment, in that case proceedings cannot be initiated taking resort to the provisions of repealed enactment. 13. It has been further submitted that Section 6 of the General Clauses Act does not apply to the GST Act as well as the GVAT Act, for the simple reason that the opening words of Section 6 of the General Clauses Act says that Where this Act, or any (Central Act) or Regulation made after the commencement of this Act. It is therefore submitted that Section 6 of the General Clauses Act cannot be applied in the present case as the GST Act as well as the GVAT Act are the State Acts and not the Central Acts. It has been further submitted that under Section 100 of the GVAT Act, there is a reference to Section 7 of the

5 Bombay General Clauses Act 1904 and Section 7 of the Bombay General Clauses Act is on the same line as Section 6 of the General Clauses Act Even if one assumes that Section 7 of the Bombay General Clauses Act applies to the GST Act as well as GVAT Act, the same does not extend the duration of the repealed Act nor does it enlarge the scope thereof. Only the right accrued and liabilities incurred are saved as they were under the repealed Act to enable the initiation of proceedings and their continuance under the repealed Act by excluding them from the operation of the repeal. It has been further submitted that the Section 6 of the General Clauses Act or Section 7 of the Bombay General Clauses Act do not come into play at all as both the Acts specifically say that the rights, liabilities already accrued and acquired under the repealed Act only will continue on re-enactment of the new Act. Since the revision is not a substantive right and since it is not accrued and acquired, it will not continue on re-enactment of the GVAT Act. 14. An alternative submission was also made to the effect that when the revision proceedings initiated by the Commercial Tax Officer resulting into cancellation of Registrations of the appellants with retrospective effect are time barred i.e. beyond the prescribed period of limitation and hence the impugned order is absolutely illegal and without jurisdiction. In support this alternative submission, it is contended that as per Section 67 of the GST Act, the revision proceedings are required to be initiated within 3 years from the date of the order sought to be revised. In the present case the order granting registration was passed in 2004 whereas the order cancelling the said registration is passed in The limitation to revise the said order ends in Thus, on the face of it the revision proceedings are time barred. Reliance is placed on the decision of the Hon ble Gujarat High Court in the case of Sidhhartha Fertichem (P) Ltd 137 STC 58 (Guj.) wherein it is held that the language of section 67(1) (a) is very clear that the three year period has to be counted from the date of the order proposed to be revised. Powers of revision under Section 67 could not have been invoked after the expiry of the period of 3 years from the date of the order sought to be revised. 15. It has been further submitted that even if it is assumed that time limit prescribed under the GVAT Act applies and not the time limit under the GST Act, in that case also the time limit prescribed under GVAT Act is 5 years from the date of the order. In the present case, taking into consideration the date of the order, the time limit of 5 years as prescribed under the GVAT Act has also expired and hence even on this ground the revision proceedings cannot be sustained. 16. It has also been submitted that the necessary ingredients for revision are absent in the present case. It is a well established position in law that revision proceedings can be initiated only when there is any illegality or impropriety in the order sought to be revised. It is the obligation of revising authority to record the illegality or impropriety committed by the subordinate authority in passing the order. If there is no illegality or impropriety in the order of the subordinate authority, then the same cannot be revised. In the present case the learned Deputy Commissioner of Commercial Tax being the revising authority has cancelled the registration granted by the subordinate authority. The subordinate authority has not committed any error in passing the orders granting registration and the Deputy Commissioner of Commercial Tax has also not pointed out any illegality or impropriety in the said orders and hence the necessary ingredients for passing the revision orders are absent and hence the impugned orders are not sustainable in the eye of law. 17. One more issue is raised before this Tribunal. It is in relation to the registration certificates pertaining to the period prior to 01/04/2006 and yet the learned Deputy Commissioner of Commercial Tax has invoked the jurisdiction under section 27(5)(i) of the GVAT Act and has cancelled the registrations ab initio. The submission made before this Tribunal to that effect is that though the learned Deputy Commissioner of Commercial Tax has invoked jurisdiction under section 27(5)(i) of the GVAT Act and there is no mention of either Section 67 of the GST Act or Section 75 of the GVAT Act, the proceedings of cancellation of registrations amount to revision proceedings. To make good these submissions, it is contended that when the higher authority makes any changes in the order of the lower authority it amounts to revision. In the present case the learned Deputy Commissioner of Commercial Tax has cancelled the registrations of the appellant with effect from the date on which the same were granted. The registrations were granted either by Commercial Tax Officer or by Assistant Commissioner of Commercial Tax. The

6 certificates of registrations are orders and by way of invoking the jurisdiction under Section 27(5)(i), the learned Deputy Commissioner of Commercial Tax has cancelled the orders passed by the Commercial Tax Officer, which is the lower authority and hence it will amount to revision of the orders passed by the Commercial Tax Officer and the proceedings initiated under Section 27(5)(i) are revision proceedings. It is also contended that the procedure as laid down for exercising jurisdiction under Section 27(5)(i) is akin or identical to the procedure as prescribed for revision. The lower authority is required to send the proposal to the higher authority i.e. Deputy Commissioner of Commercial Tax, regarding cancellation of registrations and the Deputy Commissioner of Commercial Tax, after applying his mind and perusing the record is required to take a decision to cancel the registrations. Under Section 75 of the GVAT Act, it is the same procedure which is prescribed under Section 27(5)(i) of the GVAT Act. The only difference between the two Sections is that Section 75 imposes the limitation of one year from the date of the order to be revised whereas Section 27(5)(i) does not lay down any limitations. 18. Other legal contentions are also raised to the effect that the appellants have entered into valid transactions with the alleged vendors and the registrations of the vendors have been cancelled by subsequent orders. When the transactions were entered into by the appellants with the alleged vendors, the vendors registrations were in force and they were not cancelled and hence the appellants registrations cannot be cancelled only on that ground. It has also been submitted that in cancelling the registrations of the appellants, the authorities have acted in violation of the Principles of Natural Justice. The authorities have never supplied copies of the cancellation orders of the vendors. No other documents have also been supplied to the appellants. It is the established Principle of Law that if any document is relied upon while taking an adverse view against the appellants, the same is required to be supplied to the affecting parties. It is, therefore, submitted that the impugned orders of cancellation of registrations are in violation of Principle of Natural Justice and hence deserve to be quashed. It has also been submitted that the appellants have placed on record the entire documentary evidences in support of its claim of genuine transactions, however, there is no whisper about these documents. In absence of these documents, the transactions cannot be branded as in-genuine or unacceptable transactions. 19. In the above view of the matter, it is strongly urged that the registrations have been wrongly and illegally cancelled by the learned Deputy Commissioner of Commercial Tax and the said orders are therefore required to be quashed and set aside. 20. Mr. R.S. Parmar the learned Govt. Agent appearing for the respondent in S.A. No. 276 & 277 of 2010 as well as Mr. Y.A. Radhanpura, the learned Govt. Agent appearing for the Opponent in Revision application Nos. 49 & 50 of 2012 on the other hand supported the orders passed by the authorities below and strongly urged that there is no infirmity in any of the orders which are under challenge and hence the appeals as well as the revision applications filed by the appellant/applicant deserve to be dismissed and/or rejected. The issues regarding jurisdiction and limitation raised by the appellant/applicant were strongly opposed by the learned Government Agent appearing for the respondent. Since the learned Deputy Commissioner has exercised his original jurisdiction there is no question of treating his action of cancelling the registration as the revisional action. Since the registration is deemed to have been granted on enactment of GVAT Act, it cannot be said that the registration granted under the GST Act was sought to be cancelled under the GVAT Act. Moreover, powers were exercised under section 27(5)(i) of the GVAT Act which does not lay down any period of limitation. Even, otherwise, GVAT Act has come into force with effect from 01/04/2006. The registration was cancelled on an application moved by the applicant/appellant in 2011 which was sought to be revised in 2012 and even on this ground, the order is not barred by the limitation. Section 7 of the Bombay General Clauses Act can be pressed into service in view of the provisions contained in sub-section (3) of section 100 of the GVAT Act as it is clearly stated that without prejudice to the provisions contained in sub-section (2) and subject thereto, section 7 of the Bombay General Clauses Act, 1904 shall apply in relation to the repeal of the said Act as if the said Act has been enacted within the meaning of the said section 7. Even, sub-section (2)(b) of section 100 specifically discusses about the registration certificate. It says that any registration certificate issued under the said Act and in force immediately before the appointed day shall be deemed to be registration certificate issued

7 under this Act, and accordingly such registration certificate shall be valid and effectual as a registration certificate under this Act until such certificate is issued, substituted, suspended or cancelled under the provisions of this Act. The learned Deputy Commissioner is therefore, quite justified in exercising his powers in section 27(5)(i) of the Act even with regard to the registration certificate issued under the GST Act. 21. Having heard the learned counsels appearing for the appellant/applicant and the learned Government Agents appearing for the respondent/opponent and having considered the rival submissions in light of the statutory provisions and the decided case law on the subject and also having gone through the facts and circumstances of both the cases, this Tribunal is on the view that once having issued registration certificate in favour of any dealer, the subsequent cancellation thereof is a very serious matter and unless the facts of the case so warrant or the statutory provisions so permit the authority, the power of cancellation of the registration certificate cannot and should not normally be exercised. It does not affect only that dealer whose registration is sought to be cancelled but it also affects to all other persons with whom the said dealer has entered into the transactions of sales and purchases. Such powers are therefore sparingly and exceptionally to be exercised by the authority and while exercising such powers, statutory provisions and the principle of law, equity and justice are to be complied with. Keeping this broad principles in mind, this Tribunal now proceeds to deal with the cases on hand. 22. In Y. M. Traders, the learned Deputy Commissioner has passed detailed order observing therein that the appellant was indulged only in issuing bogus bills and there was no transaction of purchases of goods. Bills were issued only with a view to claim ITC and thereby, to defraud the State exchequer. It was also observed in the order that despite giving several opportunities, no explanation was tendered nor any one on behalf of the appellant remained present before him. Looking to the conduct of the appellant, the learned Deputy Commissioner came to the conclusion that after obtaining the registration, the appellant had not entered into any transactions of sales or purchases of goods. The appellant has issued merely bills only with a view to claim ITC without entering into any transactions of sales and purchases and the appellant has entered into activities of causing damage to the State exchequer after obtaining the registrations. 23. From the perusal of the order passed by the learned Deputy Commissioner, in the case of M/s. Shah Enterprises, it clearly appears that he has considered the transactions of sales and purchases effected by the applicant during the period from to and while comparing the figures of those sales and purchases with the details furnished by the applicant in the returns, he has came to the conclusion that the applicant has made purchases from the dealers whose registrations have been cancelled ab initio. The learned Deputy Commissioner has also considered the transactions entered into by the applicant with other dealers and he came to the conclusion that all these parties have simply issued bills without effecting any sales or purchases of the goods. There were no actual transactions of sales and purchases of goods. The learned Deputy Commissioner has also observed that the notices in Form 104 as well as in Form 503 were duly served on the applicant and the applicant was supposed to give its reply on or before However, no such reply was filed and time was sought for. The applicant was thereafter given further time on and However, no details were furnished. He has therefore, observed that despite giving repeated opportunities to the applicant, no explanation was given by the applicant. The learned Deputy Commissioner was therefore, led to believe that the applicant was indulged into only billing activities and there was no transaction of sales and purchases of goods. The applicant has wrongly claimed the Input Tax Credit and thereby, defrauded the State exchequer. After making all these observations, the order passed by the Commercial Tax Officer cancelling the registration on the basis of the applicant s application was modified and the registrations of the applicant were cancelled ab initio i.e. from the date of grant of registration both under the GST Act as well as CST Act. 24. It is also necessary to have a close look to the relevant statutory provisions contained in the GVAT Act. Section 21 of the GVAT Act deals with registration. A dealer cannot carry on business unless he possesses a valid registration certificate as provided under this Act. Section 22 deals with voluntary registration. Section 23 is very material as it talks about deemed registration. It says that every dealer

8 registered as on the appointed day under any of the earlier laws or under the Central Act shall be deemed to be registered under section 21. Thus, all these dealers who are duly registered under the GST Act or under the CST Act are deemed to be registered after enactment of the GVAT Act. Precisely, for this reason, proviso to Rule 5 makes it very clear that the dealer who is registered under any of the earlier laws, is deemed to have been registered under section 23 and he shall not be required to submit an application under this sub rule. Section 27 deals with suspension or cancellation of registration and clause (i) of section 27(5) makes it clear that if a dealer, without entering into any transactions of sale issues to another dealer tax invoice, retail invoice, bill or cash memorandum, with intention to defraud the Government revenue,the Commissioner may at any time for reasons to be recorded in writing and after giving the dealer an opportunity of being heard, cancel his certificate of registration from such date as may be specified by him. Thus, no time limit is specified while exercising the power under section 27(5)(i) of the Act. A very wide discretion is given to the authority to cancel the registration from such date as may be specified by him. Thus, while exercising the original jurisdiction or in a given case revisional jurisdiction there is no embargo on the exercise of powers by the authority to cancel the registration even with retrospective effect. It is true that when the authority intends to cancel or suspend registration under sub section 5 or 5A of section 27, a dealer must be given a notice in Form 104 as per the provisions contained in Rule 10(3) of the Rules. It is also true that as per the provisions contained in Rule 57(2) of the Rules, before passing any order under section 75(1) authority must serve notice in Form 503 to the affected person giving him reasonable opportunity of being heard. However, these are mere procedural matters and the real intention of issuance of notice either in Form 104 or Form 503 is to give an opportunity of being heard to the affected person and this aspect has already been taken care of while issuing the requisite notice to the appellant/applicant. 25. The cases referred to and relied upon by the parties are also required to be considered In L. G. electronics (India) Ltd vs. Commissioner of Trade and Taxes, 16 VST 361 (Del), it is held that Delhi Sales Tax Act, 1975 was repealed and Delhi Value Added Tax Act, 2004 was brought into force with effect from April 1, The 2004 Act had no provision for suo motto exercise of power of revision by the Commissioner. The power to revise an assessment order was conferred upon the Commissioner for the first time by an amendment to the 2004 Act which incorporated section 74A therein with effect from November 16, The Commissioner (and, therefore, his delegate the Joint Commissioner) had no power under section 46 of the repealed Act to revise an assessment order. The repeal and savings section (section 106) of the 2004 Act did not save the power under section 46 of the 1975 Act. It is further held that the rejection of the claim for refund was wrong for two reasons. (a) Since the suo motu revision of the assessment order was bad in law, the assessment orders sought to be revised must be held to have been validly passed and there was no impediment in accepting, in principle, the claim for refund subject to any legal obstacle. (b) The claim for refund was made by the petitioner under section 30 of the 1975 Act and could be rejected only on the ground mentioned in sub-section (3) and (6) of section 30 of the Act. As far as section 30(3) was concerned, the claim for refund was admittedly made within a period of twelve months form the date of the order giving rise to the claim. As far as section 30(6) of the Act was concerned, the revision proceedings suo motto initiated by the Commissioner having been quashed, no proceeding in respect of the subject matter of the claim for refund was pending. The assessment order on the basis of which the refund claim was made was not the subject matter of any appeal or any other proceedings. Consequently, the refund claims have to be allowed In Hindustan Construction Company Ltd vs. State of Haryana and others, 141 STC 119 (P & H), it is held that right of appeal, although a creation of statute, is inherent in a suitor according to the statute on the commencement of the lis and, therefore, can be treated to be a vested right but no such right can be claimed as a matter of right by any person with regard to a power of revision. The power of revision conferred upon a revisional authority cannot be treated to be akin or similar to a right of appeal conferred upon a suitor. 26. There is no dispute about the legal proposition laid down in the above referred cases. However, the said legal positions are to be considered in light of the facts of the cases on hand. In the present cases,

9 the whole emphasis is on the provisions contained in Section 100(2)(b) of the Gujarat VAT Act under which the registration certificate issued under the repealed Act is deemed to be the registration certificate issued under the present Act and it is valid and effectual so long as it is not cancelled under the provisions of the present Act. Moreover, under Section 27(5)(i) of the present Act, the authority can exercise its original jurisdiction for the purpose of cancellation of the registration certificate issued in favour of the dealer. Even under Section 75 of the present Act revisional jurisdiction can also be exercised by the authority. Simply because the word revision is not mentioned in Section 100(2)(a) of the Act, it cannot be said that such powers are not saved while repealing the old Act. 27. The learned counsels appearing for the appellant/applicant have made very strenuous efforts and cited various decisions of the courts to convince this Tribunal that this Tribunal should confine itself to the language employed in a statute as it is the determining factor of legislative intent and this Tribunal should not add or amend or by construction should not make up deficiencies which are left in the present Act. Since the revision is not saved in Section 100 of the present Act and the orders passed by the authorities cancelling the registration certificate are amounting to revisions, such actions cannot be justified by reading something more in Section 100 which is not there. To substantiate these arguments, several decisions were referred to and relied upon In Shiv Shakti Co-op Housing Society vs. Swaraj Developers (2003) 6 SCC 659, it is held that it is well settled principle in law that the Court cannot read anything into a statutory provision which is plain and unambiguous. A Statue is an addict of the legislature. The language employed in a statute is the determinative factor of legislative intent. The words and phrases are symbols that stimulate mental references to referents In the case of Union of India and others vs. Dharamendra Textile Processors and others, 18 VST 180 (SC), it is held that the language employed in a statute is the determinative factor of legislative intention. While interpreting a provision the Court interprets the law and cannot legislate it. If a provision of law is misused and subjected to the abuse of process of law, it is for the legislature to amend, modify or repeal it, if deemed necessary and legislative casus omissus cannot be supplied by judicial interpretative process In the case of Orient Traders vs. Commercial Tax Officer, Tirupati, 13 VST 530 (SC), it is held that it is well established principle that exemption notifications are to be construed strictly. If the intention of the legislature is clear and unambiguous, then it is not open to the Courts to add words in the exemption notification to extend the benefit to other items which did not find mention in the notification In the case of Tata Cummins Ltd vs. State of Jharkhand and others, 148 STC 190 (Jharkhand) confirmed in 148 STC 199 (SC), it is held that it is settled law that when the words of a statute are clear, plain and unambiguous, i.e. they are reasonably susceptible to only one meaning, the Courts are bound to give effect to that meaning irrespective of consequences In the case of Vikrant Tyres Ltd vs. First Income Tax Officer, Mysore, 127 STC 5 (SC), it is held that it is settled principle that while construing revenue Acts, Courts have to give a fair and reasonable construction to the language of the Statute without leaning to one side or the other, meaning thereby that no tax or levy can be imposed on a subject by an Act of Parliament without the words of the statute clearly showing an intention to lay the burden on the subject. In this process Courts must adhere to the words of the statute and the so-called equitable construction of those words of the statute is not permissible. The task of the Court is to construe the provisions of taxing enactments according to the ordinary and natural meaning of the language used and then to apply that meaning to the facts of the case and in that process if the tax-payer is brought within the net he is caught, otherwise he has to go free. 28. Really speaking, the above decisions might not have much relevance so far as the facts of the present cases are concerned. This Tribunal is not at all concerned with the interpretation of Section 100(2)(a) of the present Act. There is no necessity at all to justify the action of the authorities below by adding, amending or making construction of Section 100(2)(a) which may or may not confer the revisional powers on the authorities. This Tribunal is mainly concerned with the provisions contained in Section

10 100(2)(b) of the present Act. Right to cancel the registration certificate issued under the repealed Act is specifically saved under Section 100(2)(b) of the present Act, as it is provided therein, in no uncertain terms that notwithstanding the repeal of the Gujarat Sales Tax Act, any registration certificate issued under the said Act and in force immediately before the appointed day shall be deemed to be the registration certificate issued under the Gujarat VAT Act and such registration certificate shall be valid and effectual as a registration certificate under the present Act until it is cancelled under the provisions of the present Act. Thus, the powers are conferred on the authorities to cancel registration certificate issued even under the repealed Act. Once the proceedings are validly initiated under the present Act, very wide discretion is given to the authorities to cancel registration with effect from the date, such authorities deem fit and proper. Simply because that date falls under the old or repealed Act, it does not debar the authority from exercising its discretion of cancelling the registration certificate from that date. Even if there is no reference of word revision in Section 100(2)(a) of the present Act, any registration certificate issued under the repealed Act and in force immediately before the appointed day is deemed to be registration certificate issued under the new Act in view of Section 100(2)(b) of the present Act and such registration certificate is valid only until it is cancelled. Such cancellation may be made either by exercising original jurisdiction under Section 27(5)(i) or by exercising revisional jurisdiction under Section 75 of the present Act. Section 27(5)(i) does not lay down any time limit as it is specifically mentioned that the authority may at any time cancel the certificate of registration issued in favour of any dealer. There is no restriction even for the purpose of deciding the effective date of the cancellation of the registration certificate. Only requirement which is mentioned in Section 27(5))(i) of the present Act is that the authority must record the reasons for cancellation of registration certificate, in writing and an opportunity of being heard is required to be given to the dealer. While perusal of the orders passed by the authorities below it clearly appears that both these conditions are duly satisfied. The plain reading of Section 27(5)(i) rules out any possibility of challenging such order of cancellation of registration certificate on the ground of limitation. Even if it is considered that the impugned order of the cancellation of registration certificate passed by the authorities below is amounting to a revisional order and Section 75 of the present Act is invoked, in that case also, the registration certificate can be said to be issued on 01/04/2006 as on that day the present Act has come into force and in view of the provisions contained in Section 23 of the Act, it is considered to be a deemed registration. The proposal was made for cancellation of registration certificate and sui motto powers are exercised well within the time and the impugned order was passed within the prescribed time limit. Hence, taking any view of the matter, it cannot be said that the impugned order of cancellation of registration certificate passed by the authorities below are barred by limitation. 29. Section 27(5)(i) of the Act can be invoked only in the case that the dealer without entering into any transaction of sale, issues to another dealer any tax invoice, retail invoice etc. and the only intention behind issuance of such tax invoice is to defraud the Government revenue. In the case of M/s. Y.M. Traders the learned Deputy Commissioner of Commercial Tax very clearly observed that the appellant has not entered into any transaction of purchases after getting registration and that without entering into any transaction of sales and purchases, tax invoices were issued so as to enable another dealer to get the credit for input tax. It is further observed that after getting registration number, the appellant has undertaken such activities which caused damage to the Government revenue. More or less similar observations are made in the case of M/s. Shah Enterprise. Thus, the authorities below are justified in cancelling the registration by invoking the provisions contained in Section 27(5)(i) of the Act. 30. Considering the entire facts and circumstances of the case and in view of the observations made, conclusions drawn and findings recorded herein above, this Tribunal is of the view that there is no infirmity in the orders of cancellation of registration certificate passed by the authorities below and hence the said orders are hereby confirmed. 31. We accordingly pass the following order. ORDER

11 32. All these Second Appeals and Revision Applications are accordingly dismissed and/or rejected without any order as to cost. Pronounced in open court on this 5 th day of June, Sd/- Sd/- Sd/- (Mr. Justice K.A.Puj) (Shri Y.P.Bhatt) (Shri N.A.Acharya) President Member Member