2014 (1) TMI 1464 - HC - VAT and Sales Tax

Initiation of revisional proceedings - Whether appellate proceedings are pending for adjudication before it, the revenue/ State cannot initiate the revision proceedings under Section 75 of the GVAT Act, 2003 read with Section 9(2) of the Central Sales Tax Act, 1956 in respect of the same assessment which is the subject matter of appeal - Held that - Tribunal has materially erred in considering the legality and validity of the initiation of revisional proceedings, taking the original assessment order under suo motu revision - Even otherwise, when the revisional proceedings were under contemplation and initiation of suo motu revisional proceedings was not under challenge before the Tribunal, the Tribunal has exceeded in its jurisdiction in quashing and setting aside the proposed initiation of suo motu revisional proceedings and in holding that the Commissioner has no jurisidiction and / or power to exercise the revisional jurisdiction in the case. - order set aside - Decided in favour of Revenue.

Summary

Issues:
1. Interpretation of jurisdiction regarding revisional proceedings under the GVAT Act and Central Sales Tax Act during pending appellate proceedings.

Analysis:
The judgment revolves around the issue of whether the Gujarat Value Added Tax Tribunal has the authority to conduct revisional proceedings under Section 75 of the GVAT Act and Section 9(2) of the Central Sales Tax Act while appellate proceedings are pending for adjudication before it. The primary question raised was whether the Tribunal was correct in holding that the revenue/state cannot initiate revision proceedings in respect of the same assessment that is the subject matter of appeal before it, especially when the legality of the revisional proceedings was not challenged before the Tribunal.

The appellant, represented by the Assistant Government Pleader, argued that since the legality and validity of the revisional proceedings were not under challenge before the Tribunal, the Tribunal erred in considering and concluding that the Commissioner had no power or jurisdiction to exercise revisional powers. The appellant contended that the Tribunal should not have addressed the issue of revisional jurisdiction when it was not the subject matter before them. The appellant emphasized that the main appeal was still pending before the Tribunal, and therefore, the question of revisional jurisdiction should be considered when the revisional proceedings are initiated.

On the other hand, the respondent, represented by a Senior Advocate, did not dispute that the legality and validity of the revisional proceedings were not challenged before the Tribunal. The respondent requested appropriate orders to be passed but wanted to keep all contentions open for any future revisional proceedings.

The Court, after hearing both parties, concluded that the Tribunal had erred in considering the legality and validity of the initiation of revisional proceedings when it was not the issue before them. The Court found that the Tribunal exceeded its jurisdiction by quashing the proposed initiation of revisional proceedings. The judgment quashed and set aside the Tribunal's decision, allowing the Commissioner to exercise suo motu revisional powers against the original assessment in the future. The Court emphasized that all contentions available to the respondents should be kept open for any future proceedings, except for the question of limitation. The Tax Appeal was allowed, and the impugned judgment was quashed and set aside.

In summary, the judgment clarifies the jurisdictional aspect of conducting revisional proceedings under the GVAT Act and Central Sales Tax Act during pending appellate proceedings, emphasizing that such proceedings should be considered when initiated and not when the legality of initiation is not under challenge before the Tribunal.