2013 (10) TMI 440 - HC - VAT and Sales Tax

Limitation period - Revised assessment - Held that - original order of assessment for the year 1997-98 was issued in proceedings CST.50386/97-98 dated 11.3.2000. Even though the said assessment order dated 11.3.2000 has not been filed in the typed set of papers, in the revised proceedings dated 2.7.2002, the said proceedings dated 11.3.2000 has been shown as reference No.1. Hence, the said assessment order dated 11.3.2000 is the original assessment order. The proceedings dated 2.7.2002 is only a revised proceedings of the Commercial tax officer considering the representation of the petitioner regarding the disallowance of the exemption on export sales and disallowance of claim of assessment at 4% against the C forms. As rightly contended by the learned counsel for the appellant, the proceedings dated 2.7.2002 is only a revised proceedings and not a original order of assessment, since the original order of assessment for the assessment year 1997-98 is dated 11.3.2000. As per the unamended provision of Section 16(1)(a) of C.S.T.Act, any revision of assessment of the escaped turnover ought to have been made within a period of five years from the expiry of the year to which tax relates. Since the assessment year is 1997-98, in the case on hand, any revision of proceedings ought to have been issued on or before 30.3.2003. But the impugned revision notice was issued on 5.4.2004 and the impugned revised order for the year 1997-1998 was issued on 23.8.2004, which is beyond the period of five years stipulated in Section 16(1) - Decided in favour of assessee.

Summary

Issues:
1. Revision of assessment order beyond the period of limitation under Section 16(1)(a) of T.N.G.S.T Act.
2. Interpretation of original and revised assessment orders for the assessment year 1997-98.
3. Application of the amended provision of Section 16(1)(a) of the TNGST Act, 1959.
4. Determining the limitation period for revised assessment proceedings.

Issue 1: Revision of assessment order beyond the period of limitation under Section 16(1)(a) of T.N.G.S.T Act:
The appellant challenged an order dismissing a writ petition against a revised assessment order dated 23.8.2004, arguing that it exceeded the prescribed period of limitation under Section 16(1)(a) of the T.N.G.S.T Act. The High Court analyzed the timeline of assessments and determined that the revised assessment order was issued beyond the five-year limitation period from the final assessment order, thus setting aside the lower court's decision.

Issue 2: Interpretation of original and revised assessment orders for the assessment year 1997-98:
The Court examined the sequence of assessment orders for the appellant under the C.S.T.Act, 1956 for the year 1997-98. It was established that the original assessment order dated 11.3.2000 was followed by a representation leading to revised proceedings on 2.7.2002. The Court clarified that the 2.7.2002 proceedings were a revision and not an original assessment, emphasizing the importance of distinguishing between the two for the purpose of limitation under Section 16(1)(a).

Issue 3: Application of the amended provision of Section 16(1)(a) of the TNGST Act, 1959:
The Court discussed the amendment to Section 16(1)(a) by Amended Act 22 of 2002, effective from 01.07.2002. The amended provision altered the limitation period calculation to commence from the date of the final assessment order. The Court emphasized that the amendment operated prospectively, not retrospectively, and thus the impugned revised assessment proceedings of 23.8.2004 could not rely on the amended provision for sustaining the assessment.

Issue 4: Determining the limitation period for revised assessment proceedings:
By referencing the unamended provision of Section 16(1)(a) of the C.S.T.Act, the Court established that any revision of assessment for the escaped turnover should have been completed within five years from the end of the relevant assessment year. Since the impugned revised order was issued on 23.8.2004 for the 1997-98 assessment year, which exceeded the five-year period stipulated in Section 16(1), the Court concluded that the revised assessment order was time-barred.

In conclusion, the High Court allowed the appeal, setting aside the lower court's order due to the revised assessment being beyond the statutory limitation period. No costs were awarded, and the connected miscellaneous petition was closed.