Coastal Oil And Gas Infrastructure (P.) Ltd VS Assistant Commissioner (CT)

M/s. Coastal Oil and Gas Infrastructure Private Limited, represented by their Deputy General Manager – Projects in Cuddalore, has filed writ appeals challenging assessment orders issued by the first respondent for the assessment years 2010-11, 2011-12, and 2012-13. These appeals, numbered W.P.Nos.41443 to 41445 of 2016, share common facts and submissions and are thus addressed collectively in this judgment.

The appellant company entered into a “Terminalling Service Agreement” on 26.05.2010 with another entity named ‘M/s. Nagarjuna Oil Company Limited’ (referred to as “NOCL”). According to this agreement, the appellant was tasked with constructing storage terminals on land owned by NOCL for the benefit of NOCL. The agreement obligated the appellant to handle various aspects of the project, including design, engineering, procurement of construction materials, and the actual construction of the terminal facilities for NOCL’s use.

M/s. Coastal Oil and Gas Infrastructure Private Limited, represented by its Deputy General Manager – Projects in Cuddalore, has filed writ appeals challenging assessment orders issued by the first respondent for the assessment years 2010-11, 2011-12, and 2012-13. These orders were issued on July 18, 2016, under TIN 33524383769.

The appellant, a company, entered into a “Terminalling Service Agreement” with M/s. Nagarjuna Oil Company Limited (NOCL) on May 26, 2010. According to this agreement, the appellant was tasked with building storage terminals for NOCL on land owned by the latter. The agreement required the appellant to handle the design, engineering, procurement of construction materials, and erection of the terminal for NOCL’s use.

The Assistant Commissioner (CT), Cuddalore Town Circle, Cuddalore, passed an order on July 18, 2017, after scrutinizing the returns. As the facts and submissions were common across all appeals, the final determination made by the Assistant Commissioner (CT) (FAC), Cuddalore Town, serves as the basis for the assessment years in question.

M/s. Coastal Oil and Gas Infrastructure Private Limited, represented by its Deputy General Manager – Projects, in Cuddalore, has filed writ appeals against assessment orders issued by the first respondent, the Assistant Commissioner (CT) of Cuddalore Town Circle. These appeals, collectively addressed in this judgment, pertain to assessment years 2010-11, 2011-12, and 2012-13.

The crux of the matter revolves around a “Terminalling Service Agreement” entered into by the appellant with another entity, M/s. Nagarjuna Oil Company Limited (NOCL), on May 26, 2010. Under this agreement, the appellant was tasked with constructing storage terminals on land owned by NOCL, providing engineering services, procuring construction materials, and erecting the terminal for NOCL’s use.

The Assistant Commissioner (CT) of Cuddalore Town Circle issued assessment orders on July 18, 2016, determining the tax liability of the appellant for the aforementioned assessment years. Subsequently, the appellant filed rectification petitions under Section 84 of the TNVAT Act, seeking to rectify alleged errors in the assessment orders. However, these petitions were dismissed by the Assistant Commissioner (CT), Cuddalore Town Assessment Circle, through orders dated September 30, 2016.

In their writ appeals, the appellant contests the assessment orders and the dismissal of their rectification petitions, arguing that errors were made in the assessment process. As the facts and submissions are uniform across the appeals and petitions, they are addressed collectively in this judgment.

The court scrutinizes the records and submissions provided by both parties. After due consideration, the court makes its final determination on the issues raised, incorporating the Assistant Commissioner’s assessments and dismissals of rectification petitions as part of the judgment.

M/s. Coastal Oil and Gas Infrastructure Private Limited, represented by their Deputy General Manager – Projects in Cuddalore, is the appellant in a series of writ appeals. They are challenging assessment orders issued by the first respondent, the Assistant Commissioner (CT) of Cuddalore Town Circle, for the assessment years 2010-11, 2011-12, and 2012-13.

The crux of the matter lies in an agreement between M/s. Coastal Oil and Gas Infrastructure Private Limited and M/s. Nagarjuna Oil Company Limited (NOCL) dated 26.05.2010, titled “Terminalling Service Agreement.” According to this agreement, Coastal Oil was tasked with constructing storage terminals for NOCL on land owned by NOCL. Coastal Oil was responsible for the design, engineering, procurement of materials, and construction of the terminals for NOCL’s use.

The Assistant Commissioner (CT) of Cuddalore Town Circle passed assessment orders on 18.07.2017 after scrutinizing the returns. Coastal Oil, feeling aggrieved by these orders, filed rectification petitions under Section 84 of the TNVAT Act, 2006, alleging errors in the assessment orders. However, these petitions were dismissed by the Assistant Commissioner (CT) of Cuddalore Town Assessment Circle on 30.09.2016.

Subsequently, Coastal Oil filed writ petitions, numbered 41443 to 41445 of 2016, challenging the original assessment orders issued by the Assistant Commissioner (CT) of Cuddalore Town Circle for the aforementioned assessment years. Coastal Oil contended that the assessing officer failed to consider payments made to ABIR Infrastructures Private Limited, a subcontractor, which, according to Rule 8(5) of the TNVAT Rules 2007, should have been adjusted. Coastal Oil argued that this failure constituted an error in the assessment orders.

During the proceedings before the writ court, Coastal Oil argued that the issue at hand involved a question of law and therefore warranted interference with the assessment orders. On the other hand, the revenue department contended that the matter was one of fact and could be addressed in any subsequent appeal.

Ultimately, the writ appeals seek to challenge the assessment orders on the grounds of the assessing officer’s alleged failure to consider adjustments related to subcontractor payments, as mandated by the TNVAT Rules 2007. The outcome of these appeals will likely hinge on whether the court deems the issue to be one of law or fact, and whether Coastal Oil’s contentions regarding the application of Rule 8(5) hold merit.

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