2004 (5) TMI 545 - HC - VAT and Sales Tax

Validity of a notice issued by the Assessing Authority for finalization - Manufacture and production of copper wire for sale - HELD THAT - By virtue of Ordinance promulgated on March 3 1998 section 11 of the Act was substituted. The substituted provision prescribes a time-limit for the Assessing Authority to pass an order of assessment. Such Ordinance was followed by Punjab Act No. 12 of 1998 which received the assent of the Governor of Punjab on April 15 1998. The Ordinance was promulgated before the return for the last quarter of assessment year 1997-98 was required to be filed on or before April 30 1998. Such return was filed before the said date. A division Bench of this Court in Civil Writ Petition titled Khazan Chand Nathi Ram v. State of Haryana 2004 (3) TMI 720 - PUNJAB AND HARYANA HIGH COURT has held that the amended provision of law as it existed on the date of filing of return or the date on which return is required to be filed would be applicable. The substituted section 11 created a substantive right in favour of an assessee to get his assessment finalised within the time prescribed. Therefore keeping in view the above principles laid down the provisions of the amending Act would be applicable to the proceedings pertaining to the assessment year 1997-98 as the last date prescribed for the last return was after the promulgation of the Ordinance. Thus we find that notice dated July 4 2002 annexure P-2 could not be issued by the Assessing Authority for the purpose of completion of assessment after the expiry of period of three years from April 30 1998. Accordingly writ petition is allowed and notice dated July 4 2002 annexure P2 is hereby quashed with no orders as to costs. Petition allowed.

Summary

Issues involved: The judgment deals with the validity of a notice issued by the Assessing Authority for finalization of assessment proceedings pertaining to the assessment year 1997-98, in light of the Punjab General Sales Tax Act and subsequent amendments.

Summary:

Issue 1: Validity of Notice for Assessment
The petitioner, a registered dealer under the Punjab General Sales Tax Act, challenged a notice calling for appearance before the assessing officer for assessment year 1997-98. The petitioner contended that the Assessing Authority was required to finalize the assessment within three years from the last date for filing returns, as per the Amending Act.

Issue 2: Interpretation of Amending Act
The petitioner argued that the amendment to section 11 of the Act, which required assessment within three years from the last date for filing returns, created a substantive right for timely assessment. The Respondent-State contended that the amendment was prospective and not retrospective, and thus the Assessing Authority had jurisdiction to finalize the assessment.

Court's Decision
The Court held that the notice issued for finalization of assessment proceedings for the assessment year 1997-98 was without jurisdiction. The amended provision of law, effective before the last date for filing returns, applied to the assessment. Citing precedent, the Court emphasized the vested right of appeal and the need for assessment within the prescribed time limit. Therefore, the notice dated July 4, 2002, was quashed as it exceeded the three-year period from the relevant date.

This judgment clarifies the application of amendments to tax laws and upholds the importance of timely assessments in accordance with statutory provisions.