Once Concessional Tax Rate and Form D was granted it cannot be taken back as it Violates Principles of Legitimate Expectation: Calcutta HC [Read Order]

The Calcutta High Court has held that once the concessional rate of tax and the certificate in Form D was granted it cannot be taken back as it violates the doctrine of legitimate expectation. The petitioner was represented by Anil Kumar Dugar, Rajarshi Chatterjee and Piyal Gupta. The respondents was represented by Anirban Roy,  Soumitra Mukherjee and Nilotpal Chatterjee.

Writ petition was filed under Article 226 of the Constitution of India against the action of the respondent on denying concessional rate of tax by not accepting the D form from the petitioner. The respondent alleged that the petitioner is a registered company and not a Government company. The petitioners first approached the Appellate Authority and aggrieved by the said order of the authority the petitioners approached the Honourable High Court.

The petitioner submitted that the denial of concessional rate of tax by not accepting Form D from the petitioners is arbitrary and illegal. The petitioner stated that they entered into genuine transactions against a company which was issuing ‘D’ Forms at the relevant point of time against the sales made to them by any registered dealer throughout India. The ‘D’ Forms were accepted by all the Sales Tax Authorities of all the States in India and submitted that since the ‘D’ Forms were issued by the said company which was accepted by the Sales Tax Authorities of other States in India, refusal to accept the ‘D’ Forms in question on the part of the State respondents concerned is highly unjustified and unreasonable. The petitioner also stated that the said since the concessional rate of tax was given to them it cannot be taken back later without genuine grounds.

Justice Md. Nizamuddin after considering the facts and circumstances of the case held that once the concessional rate of tax and the certificate in Form D was granted it cannot be taken back as it violates the fundamental principle  of legitimate expectation.

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