2011 (8) TMI 1021 - HC - VAT and Sales Tax

Reassessment proceedings initiated for the assessment year 2004-05 - Held that - From the record, it appears that the Additional Commissioner, Grade I passed the impugned order dated May 5, 2011 and rejected the representation made by the petitioner after providing the reasonable opportunity as per the direction of this court. In the impugned order, it was mentioned that the assessee has not given any written or oral submission. It was stated in the impugned order that the petitioner will have no objection if the reassessment proceedings starts under section 21 of the Act. It was also stated that proceedings under section 22 should be replaced under section 21. In view of above and also the peculiar circumstances of the case, we are not inclined to exercise our extraordinary jurisdiction under article 226 of the Constitution when the petitioner has got ample opportunity to defend his case before the first appellate authority. Appeal dismissed.

Summary

Issues:
1. Assailing approval orders for initiation of reassessment proceedings for the assessment year 2004-05.
2. Legality of approval under section 21(2) of the Act.
3. Rejection of representation by the assessing authority.
4. Applicability of section 10B of the Act.
5. Time limitation for initiating proceedings under section 10B.

Analysis:
1. The petitioner challenged the approval orders for reassessment proceedings for the assessment year 2004-05. The petitioner, a registered dealer under the U.P. Trade Tax Act and Central Sales Tax Act, initially received exemption for the assessment year but later faced disallowance. Appeals were filed and dismissed, leading to the filing of writ petitions. The Department issued notice for approval under section 21(2) of the Act to initiate reassessment proceedings, which the petitioner contested through writ petitions.

2. The petitioner argued that the approval under section 21(2) was wrongly granted as there was no reason to believe for tax evasion. The petitioner contended that the proceedings under section 22 or 21 of the Act were unwarranted, and any errors in assessment should be addressed through section 10B by the revising authority. The petitioner emphasized the necessity of a "reason to believe" for initiating section 21 proceedings, citing relevant case laws to support the argument.

3. The Additional Standing Counsel justified the rejection of the petitioner's representation, stating that no proceedings under section 10B could be initiated due to the expiration of the four-year period. It was argued that the authorities correctly initiated proceedings under section 21 of the Trade Tax Act, supported by legal precedents.

4. The court noted that the Additional Commissioner rejected the petitioner's representation after providing a reasonable opportunity for submission. The court observed that the petitioner had not given any written or oral submission, and the reassessment proceedings under section 21 were deemed acceptable. The court refrained from intervening under article 226 of the Constitution, as the petitioner had opportunities to defend the case before the appellate authority, although no appeal had been filed yet.

5. In the final judgment, the court allowed the petitioner to file appeals before the appellate authority within four weeks. It directed the concerned authority to decide on the appeals expeditiously, preferably within six months, without raising questions of limitation. The writ petitions were disposed of based on these directions.