1966 (5) TMI 61 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of notice for review of assessment order dated 21st December, 1956.
2. Interpretation of the limitation period for making assessment orders under section 11(2a) of the Act.

Analysis:
1. The petitioner, a building contractor firm, challenged a notice for review of an assessment order dated 21st December, 1956, issued by the Commissioner of Sales Tax, Delhi. The petitioner argued that the notice was invalid due to the expiration of the limitation period under section 11(2a) of the Act, which restricts assessment orders after four years. The petitioner relied on a Supreme Court decision regarding a similar provision in the Orissa Sales Tax Act, emphasizing the importance of adhering to statutory limitations for assessment orders.

2. The court analyzed the Supreme Court's interpretation of limitation provisions in tax laws and concluded that any order of assessment made by an appellate or revising authority must be considered an order under the relevant assessment section. The court highlighted the anomalies that could arise if assessment orders were not bound by statutory limitations, emphasizing the need for consistency and legal certainty in tax assessments. The court found that the power of review cannot be exercised without any limitation period, even after a significant period, to prevent potential injustice and ensure compliance with statutory provisions.

3. The court determined that the limitation period under section 11(2a) applied to the review of the assessment order dated 21st December, 1956. As the notice for review was issued after the expiration of four years from the relevant period, the court held that the Commissioner of Sales Tax was legally barred from reviewing the assessment order. Consequently, the court allowed the petition, issuing a writ of prohibition to restrain the Commissioner from further proceedings based on the review notice. The court's decision focused on upholding statutory limitations to maintain the integrity of tax assessments and prevent undue delays or uncertainties in the legal process.