Legal win in VAL kitty

The Telegraph, March 31, 2007
OUR CORRESPONDENT

Cuttack, March 30: Vedanta Alumina Limited (VAL) has won a dual of sorts with the Orissa government over purchase of high speed diesel and telescopic mobile search light for use at its alumina and captive power plant being set up at Lanjigarh in Kalahandi district.

The blue chip company was locked in a legal battle with the government in Orissa High Court ever since a penlty of Rs 1.93 crore was slapped on it on February 2 for false representation when purchasing high speed diesel and telescopic mobile searchlight.

The two-judge bench of Justices B.P. Das and M.M. Das has found the case in VAL’s favour on grounds of jurisdiction and has quashed the penalty.

The assistant commissioner of sales tax, Bolangir range, had imposed the penalty for the period of May 25, 2004, to September 26, 2006, under Sections 10A of the Central Sales Tax Act, 1956, “without giving any opportunity of hearing”, the company had argued.

The court in its order yesterday endorsed the stand taken by the counsel for Vedanta Alumina Limited saying that the order of penalty by the assistant commissioner was without jurisdiction.

The order was liable to be quashed, as the registering authority to initiate proceedings for penalty in the case was the sales tax officer, Kalahandi circle, Bhawanipatna, the company counsel had argued.

The counsel for Vedanta Alumina Limited had also contended that the goods were purchased with the understanding that they were included under the broad heading of machinery and equipment, electrical goods, building materials and lubricants and fuel in the Central Sales Tax Act.