2007 (1) TMI 538 - HC - VAT and Sales Tax

Summary

Issues:
- Reopening of ex parte assessment orders under section 30 of the U.P. Trade Tax Act, 1948.
- Application of limitation period specified under section 21(5) of the Act to assessment orders.
- Interpretation of Full Bench decision in the case of Minakshi Udyog regarding reopening of cases by the first appellate authority.

Analysis:
The judgment pertains to two revisions under section 11 of the U.P. Trade Tax Act, 1948, challenging the order of the Tribunal relating to the assessment years 1984-85 and 1985-86. The dealer had filed applications under section 30 of the Act to reopen the ex parte assessment orders, which were initially rejected. However, the first appellate authority allowed the applications, set aside the orders passed under section 30, and directed the assessing authority to pass fresh assessment orders after providing an opportunity of hearing to the dealer.

The dealer subsequently challenged the assessment orders on the ground that they were barred by limitation, contending that they were passed beyond the period specified under section 21(5) of the Act. The first appellate authority accepted this plea, quashed the assessment orders, and held them as barred by limitation. The Commissioner of Trade Tax then filed appeals before the Tribunal, which dismissed both appeals and confirmed the order of the first appellate authority.

During the hearing, the court observed that the issue involved was covered by the Full Bench decision in the case of Minakshi Udyog, where it was held that when a case is reopened by the first appellate authority, the limitation provided under section 21(5) of the Act would apply. As the assessment orders in question had indeed been passed beyond the specified period under section 21(5) of the Act, the court found no error in the Tribunal's order. Consequently, both revisions were dismissed.

In conclusion, the judgment clarifies the application of the limitation period under section 21(5) of the U.P. Trade Tax Act, particularly in cases where ex parte assessment orders are reopened by the first appellate authority. The decision underscores the importance of adhering to statutory timelines in tax assessments and upholds the principle that assessment orders passed beyond the prescribed period are invalid.