bhel entry tax

1. IN THE HON’BLE HIGH COURT OF ORISSA, CUTTACK
(ORIGINAL JURISDICTION CASE)
W.P.(C) NO.________OF 2005
CODE NO.170499
In the matter of:
An application under Articles 226 and 227 of the
Constitution of India.
A N D
In the matter of:
An application under the Orissa Entry Tax Act, 1999 and
Rules made thereunder.
A N D
In the matter of:
An application challenging the orders of assessment dated
31.03.2004 passed by the Assessing Authority,
Dhenkanal Circle, Angul for the Assessment Year 2000-
01.
A N D
In the matter of:
M/s Bharat Heavy Electricals Ltd.,
A Company registered under the Companies Act, 1956
having it’s Registered Office at “BHEL HOUSE”,
Siri Fort, New Delhi and a Site Office at NTPC/TSTPP,
“Deepsikha”, Kaniha, Dist. Angul in the State of
Orissa represented by it’s Manager (Finance)
Shri S.H.Rahman.
… Petitioner.
- Versus -
1. Assessing Authority, Dhenkanal Circle,
Angul, Dist. Angul.
2. Commissioner of Commercial Taxes,
Orissa, Cuttack, Dist. Cuttack.
… Opp. Parties.
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2. To
The Hon’ble Sri Sujit Barman Roy, LL.B., The Hon’ble Chief
Justice and His Lordship’s Other Companion Justices of the
Hon’ble High Court of Orissa.
The humble petition of the
Petitioner above named;
MOST RESPECTFULLY SHEWETH:
1. That in this writ petition the petitioner challenges the order
dated 31.03.2004 passed by the Assessing Authority, O.P.No.1 under the
Orissa Entry Tax Act, 1999 for the Assessment Year 2000-01 demanding a
tax of Rs.24,69,792.04 on an alleged fraud report which has never been
confronted to the petitioner during the course of Assessment Proceedings
and secondly that the initiation of the notices of assessment dated
03.11.2000, 17.11.2000 and 27.11.2000 made by the Assessing Authority
and the petitioner having filed its show cause replies, the Assessing Authority
without making an hearing has passed the order. Further the notices have
been initiated by Sri H.K.Panda, Assessing Authority on 03.11.2000,
17.11.2000 and 27.11.2000 and thereafter the petitioner had filed the show
cause reply which was on record. Suddenly the present Assessing Authority
being Sri P. Behera passed an order on 31.03.2004. It is pertinent to
mention here that Sri P. Behera, the present Assessing Authority who has
passed the order of assessment has not heard the petitioner company at all.
He has passed the order basing on the show cause reply submitted by the
petitioner to the notices issued by Sri H.K.Panda. In the order of assessment
the Assessing Authority has purported to tax used Tools and Tackles and
other Construction Equipments which have been moved from the petitioner’s
closed sites in other States into the NTPC Site and NALCO Site at Kaniha and
Angul in the State of Orissa. The aforesaid order is therefore arbitrary and
illegal and against the provisions contained in the Orissa Entry Tax Act, 1999
and Rules made thereunder and against the observations of this Hon’ble
Court in judgment delivered in O.J.C.No.1165 of 2001 and also violates the
principles of natural justice and fair play and against the provisions contained
in Articles 19(1)(g) of the Constitution of India and liable to be quashed.
(Photocopy of the aforesaid order is enclosed herewith marked as
ANNEXURE-1).
2. The petitioner prays for an order for quashing the order of
Assessment in Annexure-1.
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3. 3. The petitioner is a Company registered under the Companies
Act, 1956 having its Registered Office at “BHEL HOUSE”, Siri Fort, New Delhi
and Site Offices at NTPC site, Kaniha in the district of Angul and NALCO CPP
Site, Angul in the district of Angul.
4. That most of the shares of the petitioner company are held by
the President of India and also by the other citizens of India and they carry
on the business of manufacture and sale of Power Plant Equipments and
Erection of Power Plant Equipments at Customers Sites throughout the
country and outside through the agency and instrumentality of the petitioner
company.
5. The cause of action arises within the territorial jurisdiction of
this Hon’ble Court.
The facts leading to the present application inter alia are:
(a) The petitioner has entered into two contracts with National
Thermal Power Corporation Ltd. (here-in-after for short
mentioned as “NTPC”), O.P.No.3 and National Aluminium
Company Ltd. (here-in-after for short mentioned as “NALCO”),
O.P.No.4 to supply Equipments confirming to Power Plants and
for rendering services for erecting the said equipments at NTPC
and NALCO’S captive Power Plant Complex at Kaniha and Angul
respectively. To execute the aforesaid works, the petitioner has
set up Site Offices at Kaniha and Nalconagar, both in the district
of Angul and has already registered as a dealer under the Orissa
Sales Tax Act, 1947 with the Sales Tax Officer, Dhenkanal
Circle, Angul and as a dealer under the Orissa Entry Tax Act,
1999 with the Assessing Authority, Dhenkanal Circle, Angul
bearing R.C.Nos.DL-2576 and DL-2576/ET under the Orissa
Sales Tax Act, 1947 and Orissa Entry Tax Act, 1999
respectively.
(b) That for execution of the aforesaid contract, the petitioner
collect Way Bills from the Sales Tax Officer, Dhenkanal Circle,
Angul under the Orissa Sales Tax Act and brings various goods
i.e. consumables and its own Construction Tools, Tackles and
Machinery from its sites situated outside the State of Orissa into
its Sites at Kaniha and Angul. The consumables brought by the
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4. petitioner are consumed and the petitioner pays the relevant
Orissa Sales Tax and Entry Tax under the Orissa Sales Tax Act
and under the Orissa Entry Tax Act to the Sales Tax Officer,
Dhenkanal Circle, Angul as well as the Assessing Authority,
Dhenkanal Circle, Angul. It regularly files its returns under the
Orissa Entry Tax Act before the Assessing Authority, Dhenkanal
Circle, Angul, O.P.No.3.
(c) That while scrutinizing the returns filed by the petitioner
company, the Sales Tax Officer, Dhenkanal Circle, Angul issued
a notice bearing No.10227/CT dated 03.11.2000 under the
Orissa Entry Tax Act. The Sales Tax Officer informed the
petitioner that on verification of the Way Bill accounts submitted
by the petitioner, it was found out that the petitioner had
brought scheduled goods from outside the State of Orissa into
the State of Orissa and the said scheduled goods were
Machinery Equipments brought for use in the execution of works
contract and that the petitioner had filed ‘NIL’ returns. The
Sales Tax Officer directed the petitioner to give reasons in
writing for filing of such incorrect returns by 10.11.2000. An
identical notice was also issued vide Notice No.10727/CT dated
17.11.2000 wherein the Sales Tax Officer directed the petitioner
to give in writing the reasons for filing of such incorrect returns
by 25.11.2000. A statutory notice bearing No.11016 dated
27.11.2000 in Form E-4 under Rule 10(2) of the Orissa Entry
Tax Rules was issued by the Assessing Authority, O.P.No.1
directing the petitioner to show cause as to why the petitioner
should not be assessed provisionally for the period 5/2000 to
9/2000 as per the details given in the said notice and further
directed the petitioner to file its show cause and furnish relevant
documents by 12.12.2000. (Photocopies of the aforesaid three
notices are enclosed herewith marked as ANNEXURE-2
Series).
(d) That all the aforesaid notices were issued by the then Assessing
Authority Sri H.K.Panda.
(e) That in reply to the said notices the petitioner submitted its
reply dated 12.12.2000 along with all books of accounts. The
petitioner also filed a statement showing details of Way Bills
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5. utilized in Form-XXXII used by the petitioner for the period from
01.12.1999 to 30.09.2000 to procure scheduled goods. The
petitioner submitted that they have brought one old and used
Crane with Boom from its Simadri Site in the State of Andhra
Pradesh, whose book value i.e. the written down value is ‘NIL’
but for Way Bill purposes, the petitioner had given a nominal
value of Rs.96,000.00. The petitioner also submitted that it had
used Way Bills to send Scrap Materials from its site to outside
the State of Orissa. The petitioner also submitted that while
obtaining registration under the Orissa Entry Tax Act, it was
advised by the Revenue to pay Entry Tax on all scheduled goods
purchased from outside the State of Orissa and it was indicated
by the Revenue that the petitioner’s old and used condemned
materials transferred from its existing sites situated in the State
of Orissa into the present Sites inside the State of Orissa, no
Entry Tax be paid and therefore the petitioner had not paid any
Entry Tax on the old Crane with Boom received from its Simadri
Site. The copy of the said letter duly acknowledged by the
office of the Sales Tax Officer, Angul on 12.12.2000 is enclosed
herewith. The Sales Tax Officer directed the petitioner to
submit a statement of Way Bills relating to its NTPC Site by
10.01.2001.
(f) That on 10.01.2001 the petitioner approached the Sales Tax
Officer and sought four weeks time to submit necessary
statement. The case was adjourned to 24.01.2001. On
24.01.2001 the petitioner appeared and filed its statements
relating to its NTPC Site and also submitted that the petitioner
had deposited a sum of Rs.4,85,595.00 towards goods
purchased by the petitioner from outside the State of Orissa and
brought into the State of Orissa for use in the execution of the
Works Contract. (Photocopies of the petitioner replies dated
12.12.2000, 10.01.2001 and 24.01.2001 are enclosed herewith
marked as ANNEXURE-3 Series). It is pertinent to mention
here that the replies of the petitioner were filed and the case
was discussed with Sri H.K.Panda, the then Assessing Authority,
O.P.No.1.
(g) That suddenly after a span of almost more than three and half
years, the petitioner received an order dated 31.03.2004 for the
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6. assessment period 2000-01 raising a demand of
Rs.24,69,792.00 being an exparte order. In the said order the
Assessing Authority takes into account a fraud report bearing
No. ‘NIL’ dated 30.07.2000 wherein another Company M/s
Petron Engineering Construction Ltd., Mumbai has consigned old
and used construction materials to its site at Talcher where it
executes works contracts sub-contracted by BHEL to the
petitioner and taking into account an approximate value of
Rs.1,30,000.00 mentioned in the said Way Bill, the Assessing
Authority has enhanced the amounts disclosed by the petitioner
in the other 140nos. of Way Bills and finally arrived at a
Turnover of Rs.1,82,00,000.00. This order has been passed by
Sri P.C.Behera, Assessing Authority, O.P.No.1. It may be
pertinent to mention here that the Sales Tax Officer has stated
that the petitioner was directed to appear on 10.01.2001 but
the petitioner failed to appear on 10.01.2001 and further
intimations were also issued subsequently but the dealer i.e. the
petitioner neither appeared nor furnished any Time Petition and
therefore the Assessing Authority was compelled to pass the
assessment exparte and while passing the said assessment
exparte, he took into account a fraud case report for the
purpose of assessment but he conveniently forgot to confront
the same to the petitioner. In the order of assessment the
Assessing Authority refers to the date i.e. 10.01.2001. The
petitioner submits that the petitioner appeared on 10.01.2001
before the Assessing Authority and approached for time and the
case was adjourned to 24.01.2001 and again on 24.01.2001 the
petitioner appeared and submitted the statements relating to its
NTPC Site as called for by the petitioner. The Assessing
Authority finally passed an order of assessment in Annexure-1.
(h) That while passing the aforesaid order there has been a gross
miscarriage of justice because of the following
(A) The officer who issued the notices calling for
assessments and who heard the Assessment
Proceedings was Sri H.K.Panda and the officer
who finally passed the order of assessment
without hearing the petitioner was Sri P.C.Behera
and therefore two different persons, one of them
6

7. having conducted the hearing and another having
passed the order is an arbitrary act.
(B) That although the petitioner appeared on the date
of hearing i.e. 10.01.2001, the Assessing
Authority states that the petitioner had not
appeared.
(C) The fraud case reports which were used against
the petitioner for formulating an assessment was
not confronted to the petitioner at the time of
hearing and therefore the material was utilized
against the back of the petitioner, hence the
petitioner is filing this writ petition on the
following amongst other
G R O U N D S
(A) That the order of assessment passed by the Assessing
Authority, O.P.No.1 in Annexure-1 is arbitrary and illegal,
violative of the principles contained in the Orissa Entry Tax Act,
1999 and Rules made thereunder and against the provisions
contained in Articles 19(1)(g) of the Constitution of India and
liable to be quashed.
(B) That the order of assessment is bad because it is an exparte
order and violating the principles of natural justice and fair play.
(C) That the materials which have been procured by the Revenue
against the petitioner have been utilized against the petitioner in
the present assessment without confronting the same to the
petitioner.
(D) That while passing the order of assessment in Annexure-1, the
Assessing Authority has purported to tax old and used
Construction Equipments which have been sent as branch
transfer from the petitioner’s existing Sites outside the State of
Orissa to the petitioner’s present site inside the State of Orissa
and the said goods will finally be taken out by the petitioner
company from the State of Orissa after the contracts are
executed. Hence merely taxing the old and used Construction
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8. Equipments is against the law laid down by this Hon’ble Court in
the main Entry Tax matter being O.J.C.No.1165 of 2001.
(E) That the proceeding was heard by one officer and the order was
passed by another officer who never heard the petitioner at all.
Hence the entire proceeding becomes vitiated and therefore the
order in Annexure-1 also becomes vitiated and liable to be
quashed.
6. That this petition is made bonafide and in the interest of justice.
P R A Y E R
Under the aforesaid facts and circumstances, the petitioner
prays this Hon’ble Court to be pleased to allow this petition and be further
pleased to
(a) issue a writ in the nature of certiorari directing the Opp. Party
Nos.1 and 2 to certify and send up this Hon’ble Court all papers
and documents in connection with Annexure-1 so that the same
can be examined and if necessary be quashed;
(b) issue a writ in the nature of mandamus quashing the order of
assessment in Annexure-1;
(c) issue any other appropriate order and/or direction as this
Hon’ble Court deems fit and proper;
(d) all this application with costs;
And for which act the petitioner shall ever pray.
Cuttack, BY THE PETITIONER THROUGH
Date: 03.01.2005.
A D V O C A T E
File : BHEL WRIT-1
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9. AFFIDAVIT
I Shaikh Habibur Rahman, aged about 59 years son of Late Sk.
Fakir, residing at VII-H-163, Saileshree Vihar, Bhubaneswar-21, Dist: Khurda
do hereby solemnly state and affirm as follows:
1. That I am the Authorised Officer of the Petitioner Company.
2. That the facts stated in this petition are true to the best of my
knowledge and belief.
Identified by
Advocate DEPONENT.
CERTIFICATE
Certified that due to non-availability of catridge paper this
petition has been typed in thick white paper.
Cuttack
Date: ADVOCATE
9

10. IN THE HON’BLE HIGH COURT OF ORISSA, CUTTACK
MISC. CASE NO.________OF 2005
(Arising out of W.P.(C) No.________of 2005)
In the matter of:
An application u/s. 151 of the C.P.C.
A N D
In the matter of:
An application praying for stay of operation of
Annexure-1.
A N D
In the matter of:
M/s Bharat Heavy Electricals Ltd.
…
Petitioner.
- Versus -
Assessing Authority, Dhenkanal
Circle, Angul and others.
… Opp. Parties.
To
The Hon’ble Sri Sujit Barman Roy, LL.B., The Hon’ble Chief
Justice and His Lordship’s Other Companion Justices of the
Hon’ble High Court of Orissa.
The humble petition of the
Petitioner above named;
MOST RESPECTFULLY SHEWETH:
1. That the petitioner has filed the aforesaid petition and adopts
the facts and grounds stated therein as part of this petition.
1. That in the writ petition the petitioner challenges the order
dated 31.03.2004 passed by the Assessing Authority, O.P.No.1 under the
Orissa Entry Tax Act, 1999 for the Assessment Year 2000-01 demanding a
10

11. tax of Rs.24,69,792.04 on an alleged fraud report which has never been
confronted to the petitioner during the course of Assessment Proceedings
and secondly that the initiation of the notices of assessment dated
03.11.2000, 17.11.2000 and 27.11.2000 made by the Assessing Authority
and the petitioner having filed its show cause replies, the Assessing Authority
without making an hearing has passed the order. Further the notices have
been initiated by Sri H.K.Panda, Assessing Authority on 03.11.2000,
17.11.2000 and 27.11.2000 and thereafter the petitioner had filed the show
cause reply which was on record. Suddenly the present Assessing Authority
being Sri P. Behera passed an order on 31.03.2004. It is pertinent to
mention here that Sri P. Behera, the present Assessing Authority who has
passed the order of assessment has not heard the petitioner company at all.
He has passed the order basing on the show cause reply submitted by the
petitioner to the notices issued by Sri H.K.Panda. In the order of assessment
the Assessing Authority has purported to tax used Tools and Tackles and
other Construction Equipments which have been moved from the petitioner’s
closed sites in other States into the NTPC Site and NALCO Site at Kaniha and
Angul in the State of Orissa. The aforesaid order is therefore arbitrary and
illegal and against the provisions contained in the Orissa Entry Tax Act, 1999
and Rules made thereunder and against the observations of this Hon’ble
Court in judgment delivered in O.J.C.No.1165 of 2001 and also violates the
principles of natural justice and fair play and against the provisions contained
in Articles 19(1)(g) of the Constitution of India and liable to be quashed.
3. That the petitioner has a prima facie case totally in its favour for
grant of full stay.
4. That this petition is made bonafide and in the interest of justice.
P R A Y E R
Under the aforesaid facts and circumstances, the petitioner
prays this Hon’ble Court to be pleased to allow this petition and be further
pleased to grant stay of operation of order in Annexure-1 on such terms and
conditions as this Hon’ble Court may deem fit and proper;
And for which act of kindness the petitioner shall as in duty
bound ever pray.
Cuttack, BY THE PETITIONER THROUGH
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12. Date:
A D V O C A T E
File : BHEL WRIT-1
IN THE HON’BLE HIGH COURT OF ORISSA, CUTTACK
(ORIGINAL JURISDICTION CASE)
W.P.(C) NO.________OF 2005
In the matter of:
M/s Bharat Heavy Electricals Ltd.
… Petitioner.
- Versus -
Assessing Authority, Dhenkanal Circle,
Angul, Dist. Angul and others..
… Opp. Parties.
CODE NO.170499
I N D E X
Sl.No. Annexure Description of documents Pages
1. Writ Petition 1 - 9
2. 1 Assessment Order dated 31.03.2004
passed by the Assessing Authority,
Dhenkanal Circle, Angul. 10-13
3. 2 Series Copy of the Notices dated 03.11.2000,
17.11.2000 and 27.11.2000 issued by
the Assessing Authority, Dhenkanal
Circle, Angul. 14-16
4. 3 Series Copy of the letters dated 12.12.2000,
10.01.2001 and 24.01.2001. 17-24
5. V a k a l a t n a m a.
6. Misc. Case.
Cuttack,
Date : 03.01.2005. ADVOCATE
FOR THE PETITIONER
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