2013 (4) TMI 692 - HC - VAT and Sales Tax

Limitation for making the assessment order - delay in issuing recovery notices - Held that - Undisputed facts are that the different orders pertaining to the tax under the JVAT and the CST were passed and it is mentioned in the margin of the order sheets that the notices were despatched on the date when the orders were passed or a few days thereafter only. Admittedly, these notices were not served upon the petitioner for about minimum one year four months and maximum three years four months. There is no explanation by the Revenue as to how these notices were kept by the Department itself for such a long period and that too in a matter of recovery of the tax amount. It will be further relevant to mention here that it is not the case of the Revenue that the notices purported to have been issued forthwith after the order of issuance and they returned back and fresh notices were issued which were served upon the petitioner-assessee and it is also not the case of the Revenue that the petitioner avoided the service. Plea of the respondents cannot be believed that, notices duly issued and entered into the despatch register were kept in the office for one year four months to three years four months and they were used for serving upon the petitioner after such a delay. W.P. allowed.

Summary

Issues:
Challenging orders under JVAT and CST Acts for different assessment years due to delayed service of demand notices.

Analysis:
1. The petitioner challenged orders under JVAT and CST Acts for various assessment years due to delayed service of demand notices, arguing that the orders were passed after the limitation period. The petitioner contended that assessment orders were antedated to meet the limitation period. Citing the Supreme Court's ruling in State of Andhra Pradesh v. M. Ramakishtaiah & Co., the petitioner argued that orders made after the limitation period without explanation should be presumed as not made on the purported date.

2. The petitioner relied on a Division Bench judgment of the High Court that set aside assessment orders where demand notices were not served promptly. The respondents argued that the petitioner regularly appeared before the authority, and ex parte orders did not necessarily imply antedating. They emphasized that notices were dispatched and recorded in the despatch register, disputing the presumption of antedating due to delayed service.

3. The Court examined the facts and the despatch register provided by the Revenue. Noting irregularities in the despatch register, the Court found that notices were not served promptly, ranging from one year four months to three years four months delay. Referring to the Supreme Court's precedent, the Court highlighted the presumption that orders made after the limitation period without explanation could be antedated.

4. Acknowledging the respondents' argument against presuming antedating solely based on delayed notice service, the Court noted the absence of explanations for the delays. Given the circumstances where the petitioner regularly appeared, yet orders were either ex parte or allegedly antedated, the Court found merit in presuming that the orders were not passed on the purported dates due to lack of notice service explanations.

5. Consequently, the Court allowed the writ petitions, setting aside the challenged orders. The matter was remanded to the assessing officer for reassessment after providing the petitioner with a hearing opportunity. The Court directed the Commissioner of Commercial Taxes to investigate the delay and take action against responsible individuals to prevent such lapses in the future, emphasizing the importance of timely assessments to avoid revenue loss.

This detailed analysis covers the issues raised in the legal judgment comprehensively, focusing on the arguments presented by both parties and the Court's reasoning leading to the final decision.