2010 (4) TMI 979 - HC - VAT and Sales Tax

Undated show-cause notice challenged - whether section 81(3) of the U.P. Value Added Tax Act provides that the officer authorised by the Commissioner under the repealed Act to exercise the power under section 10B of the U.P. Trade Tax Act shall continue to exercise the revisional power conferred by section 56 of the U. P. Value Added Tax Act? Held that - The U.P. Value Added Tax Act while repealing the U.P. Trade Tax Act in its entirety keeps alive the old rights, liabilities and the remedies under the repealed enactment and, as such, the impugned notice for revising the order of assessment is not without jurisdiction. However, it will be open for the petitioner to submit reply to the show-cause notice and to contest the matter on merit before the authority concerned. W.P. dismissed.

Summary

Issues:
Challenge to undated show-cause notice under U.P. Trade Tax Act for revision of assessment order post-repeal by U.P. Value Added Tax Act.

Analysis:
The writ petition challenged an undated show-cause notice calling for revision of an assessment order under the U.P. Trade Tax Act post its repeal by the U.P. Value Added Tax Act. The petitioner argued the notice was without jurisdiction due to the repeal. The respondent contended that the power to revise assessment orders under the repealed Act was saved by U.P. Value Added Tax Act and U.P. General Clauses Act.

The High Court delved into the implications of repealing an enactment with a saving clause and the importance of preserving existing rights and remedies. It highlighted that the repeal did not obliterate the old Act entirely, especially when a similar statute was re-enacted simultaneously. The purpose of a saving clause is to protect accrued rights and prevent legal vacuum post-repeal.

The court examined the provisions of U.P. Value Added Tax Act and U.P. General Clauses Act, emphasizing that rights, privileges, and obligations acquired under the repealed enactment remain unaffected unless a contrary intention is expressed in the new law. It noted that the officer authorized under the repealed Act to exercise revisional powers continued to do so under the new Act.

Drawing parallels with a similar case involving the Andhra Pradesh Value Added Tax Act, the court emphasized that unless a different intention is expressed, the consequences laid down in the General Clauses Act apply to post-repeal scenarios. It clarified that the repeal of the U.P. Trade Tax Act did not affect the revisional power under section 10B, as it was reaffirmed in the new Act.

The court dismissed the writ petition, concluding that the U.P. Value Added Tax Act preserved old rights and remedies, making the show-cause notice for revising the assessment order valid. It allowed the petitioner to respond to the notice and contest the matter on merit before the relevant authority.