In Brief
Tata Steel challenged a Jharkhand tax authority's denial of a deferment certificate, claiming it was entitled to convert an earlier sales tax exemption into a tax deferment under the new VAT Act. The Court held that the repayment period for deferred tax must be calculated from the original eligibility date (31 August 2000), not from when deferment formally commenced (1 April 2006). The repayment must be completed within 5 years of the eligibility period's expiration, with an absolute ceiling of 13 years from commencement. The Court applied principles against absurd literal interpretations and upheld the deferment benefit while imposing 12% annual interest (rather than the higher contractual rate) in view of the case's special circumstances.
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