- (1.) All the aforesaid writ petitions involve a common question of law, as such, they were heard together and are being disposed of by this common judgment.
(2.) These batch of writ petitions have been filed by the dealers registered under the provision of the Jharkhand Value Added Tax Act,2005 [hereinafter referred to as "JVAT Act" in short], primarily challenging the amendments brought in Section-18 of the JVAT Act, 2005 which lays down eligibility towards claim of Input Tax Credit [ hereinafter referred to as "ITC" in short]. Further challenge has been made in the writ applications to the amendment made in the Jharkhand Value Added Tax Rules, 2006 [hereinafter referred to as "JVAT Rules"] wherein amendment has been carried in Rule-26 of the said JVAT Rules,2006 with retrospective effect for giving effect to the amendment carried out under Section-18 of the JVAT Act, 2005 aforesaid.
(3.) The writ petitioners before this Hon'ble Court are either traders or manufacturers of goods. Since in the batch of the present writ applications the only issue for adjudication is the validity of the amendment carried out under the JVAT Act, and/or JVAT Rules, individual facts of the writ applications are not discussed as the same are not in dispute. However, for proper appreciation of the issues involved in the instant writ applications, it would be appropriate to notice the various amendments carried out under the provision of Section-18 of the JVAT Act, including the amendment carried out under Rule- 26 of the JVAT Rules, which are as under:- (i) Amendment No.1 Vide notification dated 23.09.2015 an Amendment was carried out in Clause-(ii) of sub-section-4 of Section-18 of the JVAT Act, 2005 and, Clause-(iii) of sub-section-4 of Section-18 of the JVAT Act, 2005, as under:- Amendment in Section-18- b) In clause (ii) of sub-section (4), after the existing provision ?Sale in course of inter-State trade and commerce falling under sub-section (1) of Section 8 of the Central Sales Tax Act, 1956 ( 74 of 1956)?, a proviso shall be added in the following manner:- Provided that the Input Tax Credit on purchases when sold in course of inter State trade or commerce shall be allowed only to the extent of the Central Sales Tax payable under the Central Sales Tax Act, 1956 ( 74 of 1956). d) In clause (iii) of sub-section-4, a proviso shall be added in the following manner:- Provided that the Input Tax Credit on purchases when sold in course of inter State trade or commerce shall be allowed only to the extent of the Central Sales Tax payable under the Central Sales Tax Act, 1956 ( 74 of 1956). The aforesaid amendments were initially given retrospective effect with effect from 01.04.2015. (ii) Amendment No.2 In Section-18 of the JVAT Act, a new clause was inserted vide same gazette notification dated 23.09.2015 which reads as under:- f) In the existing sub-section (8), after the clause ( xvii), a new clause (xviii) , shall be added in the following manner:- (xviii) ?In respect of goods consumed or burnt up in course of manufacturing process and are not transferred into or existent in the finished product whether as goods or in any other form? The said amendment was also initially given retrospective effect with effect from 01.04.2015. (iii) Amendment No. 3 Vide notification dated 08.02.2016, Proviso inserted in Clause-(ii) and (iii) of sub-section(4) of Section-18 which was inserted vide notification dated 23.09.2015 was substituted in the following manner:- Amendment in sub-section(4) of Section-18 The existing proviso in clause-(ii) of sub-Section(4) of Section-18 shall be substituted in the following manner:- "Provided that the input tax credit on such purchases when sold in course of interstate trade and commerce shall be allowed only to the extent of Central Sales Tax payable on such sales made under sub-section (1) of Section 8 of The Central Sales Tax Act, 1956 and balance input tax shall not be available for adjustment from any tax, penalty or interest payable" The existing proviso in clause-(iii) of sub-Section(4) of Section-18 shall be substituted in the following manner:- "Provided that the input tax credit on such purchases when used for manufacturing or processing or mining of such goods sold in course of interstate trade and commerce shall be allowed only to the extent of Central Sales Tax payable on such sales of such finished or mined goods made under sub-section (1) of Section 8 of The Central Sales Tax Act, 1956 and balance input tax shall not be available for adjustment from any tax, penalty or interest payable" The aforesaid amendments were also initially given retrospective effect with effect from 1.4.2015. (iv) Amendment No.4 Vide notification dated 17 th February, 2017, Amendment was carried out under Rule-26 of the JVAT Rules, and the amendment in Rule- 26 was carried out in the following manner:- Amendment in Rule-26 A new sub-rule as sub-rule (11A) shall be inserted after sub- rule (11) in the following manner:- "Sub-rule (11A)- Where any VAT dealer is making inter-state sales falling under sub-section(1) as well as sub-section(2) of section(8) of the C.S.T. Act, 1956 and the inputs are common in both, the amount so claimed as input tax credit for the purpose of section 18(4)(ii) and 18(4)(iii) shall be calculated in the following manner:- (a) For the purpose of calculating input tax credit not admissible for adjustment from any tax payable as mentioned in Section 18(4)(ii) and 18(4)(iii) of the Act, the under mentioned formula shall apply:- Proportionate input Tax credit on such CST payable on inter-state sales falling under sub-section(1) of Section8 of the Central Sales Tax Act, 1956 (-) Tax payable on sale under sub-section(1) of Section 8 of the Central Sales Tax Act, 1956. Where, Proportionate ITC is = A x(Multiply) CST sale under Section 8(1) of the Central Sales Tax Act, 1956 C Where the values of A and C are as mentioned in sub-clause(ii) of sub-rule(5) of Rule 26. Provided where CST payable on such inter-state sales falling under sub-section (1) of Section 8 exceeds the proportionate input tax credit calculated on inter-state sales falling under sub-section (1) of Section 8 of the Central sales Tax, 1956, then the input tax credit shall be allowed only to the extent of proportionate input tax credit on sale under sub-section (1) of Section-8 of C.S.T. Act 1956 (b) For the purpose of calculating proportionate input Tax credit on inter-state sales falling under sub-section (2) of Section 8, the amount not eligible for Input Tax Credit shall be calculated/computed by applying the under mentioned formula- A x (Multiply) CST sale under Section 8(2) C Where the values of A and C are as mentioned in sub-clause(ii) of sub-rule(5) of Rule 26. Provided further that the input tax credit shall not be available for adjustment, as computed under sub-rule 11A, and shall be deductible from the eligible input tax credit as calculated under the sub-rules 26(5) to rule sub-26(11) as applicable". ;