2011 (8) TMI 1205 - SC - VAT and Sales Tax

Summary

Issues involved: Assessment under Haryana General Sales Tax Act and Central Sales Tax Act, Revisional suo motu power, Period of limitation for revisional proceedings.

Assessment under Haryana General Sales Tax Act and Central Sales Tax Act:
The appeal concerned the assessment of the respondent for the years 1995-96 and 1996-97 under the Haryana General Sales Tax Act and Central Sales Tax Act. The Assessing Officer had assessed the liability of the respondent to pay taxes for these two years by passing assessment orders. Subsequently, notices were issued by the Appellants to reopen the assessment orders u/s 40 of the Haryana General Sales Tax Act, which allows the Commissioner to call for the record of any case pending before any assessing authority for review.

Revisional suo motu power:
The respondent did not file a reply to the notices issued for reopening the assessment orders within the prescribed period of five years. The respondent then filed a writ petition in the High Court seeking to quash the notice issued after the expiry of the five-year period. The respondent argued that since the Commissioner could revise an assessment order within five years u/s 40 of the Act, no revision could be passed after the expiry of this period.

Period of limitation for revisional proceedings:
The High Court allowed the writ petition and quashed the notices, but the Appellants contended that the High Court did not consider the issue of whether the initiation of proceedings or passing of the final order was relevant for the five-year limitation period u/s 40. The Supreme Court held that this vital issue was not argued before the High Court and remitted the matter back for fresh consideration, emphasizing the need to clarify whether the final order of revision or only the initiation of proceedings needed to occur within the five-year period.

The Supreme Court set aside the High Court's order, directing a fresh consideration of the issues, including the interpretation of the limitation period under u/s 40. The parties were instructed to appear before the High Court for further proceedings. The Court clarified that it had not expressed any opinion on the issues, leaving them open for the High Court to decide in accordance with the law. The proceedings quashed by the High Court were stayed pending the final decision by the High Court. The appeal was disposed of with each party bearing their own costs.