UPVAT Act | Revision Jurisdiction Of High Court Limited To Questions Of Law, Jurisdictional Errors Or Procedural Irregularities: Allahabad High Court

The Allahabad High Court has held the revision jurisdiction under Section 58 of the Uttar Pradesh Value Added Tax Act, 2008 is limited to questions of law, jurisdictional errors, or procedural. The Court held that the High Court must refrain from going into questions of facts which have been decided by the Tribunal.

Section 58 of the Uttar Pradesh Value Added Tax Act, 2008 provides that any person aggrieved by the order passed under Section 57(7) or Section 57(8) of the UPVAT Act can file a revision before the High Court on grounds that the case involves questions of law. The limitation for filing such revision is ninety days from the service of such orders.

“In exercise of revisional jurisdiction, the High Court has a limited mandate. The scope of revisional jurisdictional, is primarily focused on questions of law, jurisdictional errors, or procedural irregularities. The High Court in a revision petition must refrain from engaging in a de novo inquiry into factual matters already adjudicated upon by the Tribunal, unless compelling grounds warranting such intervention are made,” held Justice Shekhar B. Saraf.

The Department filed an appeal against the order of the Tribunal on the question of law that whether the cello used by the assesee were capital goods or merely usable containers used for sale of ink manufactured by the assesee.

Counsel for Department argued that capital goods as defined under Section 2(f) of the UPVAT Act means any plant or machinery including apparatus, tool and appliances used for “manufacturing or processing of any goods.” It was argued that though a storage tank forms a part of capital goods, the cello used by the assesee is not a fixed part of the plant or machinery. It is merely an apparatus used for supply of already manufactured ink. Counsel submitted that once the ink is used by the customer, the cello is fitted back into plant from refill.

Further, it was argued that cello falls within the definition of exempted goods under Section 2(f) which includes vehicles used for transporting goods or passengers.

Counsel for assesee submitted that whether the cello is a part of the manufacturing process is a factual finding arrived at by the Tribunal. Merely because the cello is movable in nature does not exclude it from the definition of capital goods.

The Court held that the High Court exercising revisional jurisdiction cannot reappreciate facts and/or re-examine the evidence and findings of the Tribunal.

“There is a presumption of finality attached to judgments and orders passed by Appellate Authorities and the High Courts should not lightly disturb such judgments unless there are compelling reasons to do so. Revisional jurisdiction is not intended to be a mechanism for relitigating cases or reopening settled matters.”

The Court held that “High Courts cannot ordinarily interfere with factual findings arrived at by lower courts or tribunals unless such findings are perverse, based on no evidence, or suffer from a manifest error of law. Revisional jurisdiction does not empower High Courts to revaluate factual evidence or substitute their own findings for those of the lower courts or tribunals. Revisional jurisdiction is aimed at correcting jurisdictional errors and excesses of law.”

The Court held that the Tribunal had held that the fact that the cello is sent to the customers does not mean that it is not used to store ink. It was held that the cello being a storage tank is an essential part of the manufacturing process. The movable nature of cello would not exclude it from the definition of capital goods which also includes a storage tank under Section 2(f)(iii).

Accordingly, the revision filed by the department was dismissed.

Case Title: The Commissioner Commercial Tax U.P. Lucknow vs. S/S. D.I.C. India Ltd. 2024 LiveLaw (AB) 94 [SALES/TRADE TAX REVISION NO.- 36 of 2021]

Case citation: 2024 LiveLaw (AB) 94

Counsel for Revisionist: Bipin Kumar Pandey

Counsel for Assesee: Atul Gupta

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