2009 (11) TMI 829 - HC - VAT and Sales Tax

Whether impugned assessment orders are barred by time? Held that - The petitioner is guilty of not disclosing the true and correct facts and has tried to mislead the court. The conduct of the petitioner in not extending his cooperation to the assessing authority to reframe the assessment orders by filing reply to show-cause notice and by not participating in the proceedings and seeking adjournments and concealing these facts in the writ petition disentitles him to get any relief. It would be travesty of justice, if such a person, who was instrumental in getting the case timebarred, is granted relief by a writ court. Thus the petitioner is not entitled to get any relief under article 226 of the Constitution of India. W.P. dismissed.

Issues Involved:

1. Validity of ex parte assessment orders.
2. Applicability of limitation period under section 21(5) of the U.P. Trade Tax Act.
3. Conduct of the petitioner in the assessment proceedings.
4. Equity and clean hands doctrine in writ jurisdiction.

Issue-Wise Detailed Analysis:

Validity of Ex Parte Assessment Orders:
The petitioner, a proprietorship concern, faced ex parte assessment orders for the assessment years 2000-01, 2001-02, and 2002-03 under the U.P. Trade Tax Act. The applications to set aside these orders were dismissed, but the Tribunal allowed the appeals, finding that the petitioner was prevented by sufficient cause from participating in the assessment proceedings due to illness. The Tribunal set aside the ex parte assessment orders and remanded the matter to the assessing authority for fresh assessment after providing an opportunity for hearing to the petitioner.

Applicability of Limitation Period under Section 21(5) of the U.P. Trade Tax Act:
The petitioner argued that the impugned assessment orders were barred by time under section 21(5) of the Act, which provides a six-month limitation period for passing fresh assessment orders after an order is set aside. The respondents contended that the limitation period should be one year under section 21(4) of the Act, applicable when the matter is remanded by an appellate authority. The court referred to the Full Bench decision in Minakshi Udyog, Agra v. Commissioner of Trade Tax, which clarified that the six-month limitation period under section 21(5) applies when an assessment order is set aside. The court concluded that the limitation period should start from January 17, 2005, when the assessing authority withdrew the recovery certificate.

Conduct of the Petitioner in the Assessment Proceedings:
The court examined the petitioner's conduct, noting that he repeatedly sought adjournments and failed to cooperate with the assessing authority. The petitioner did not appear in the original assessment proceedings due to illness and continued to seek adjournments after the Tribunal remanded the matter. The petitioner also filed a transfer application to move the case to another assessing authority, which was ultimately rejected. The court found that the petitioner was instrumental in delaying the proceedings and had not disclosed these facts in the writ petition.

Equity and Clean Hands Doctrine in Writ Jurisdiction:
The court emphasized that writ jurisdiction is not a matter of course and that a petitioner must come with clean hands. The petitioner's conduct in seeking adjournments and failing to cooperate with the assessing authority disentitled him to any relief. The court cited several Supreme Court decisions, including A.M. Allison v. B.L. Sen and Prestige Lights Ltd. v. State Bank of India, which highlighted the importance of full disclosure and honest conduct in seeking equitable relief. The court concluded that granting relief to the petitioner would promote dishonesty and abuse of the court process.

Conclusion:
The court dismissed the writ petition summarily with costs of Rs. 5,000, holding that the petitioner was not entitled to any relief under article 226 of the Constitution of India due to his conduct and failure to disclose material facts.

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