2015 (8) TMI 857 - HC - VAT and Sales Tax

Revisional Orders barred by limitation Penalty imposed on assesse under Section 5A(3)(i) of Karnataka Sales Tax Act, 1957 was reversed Additional Commissioner issued suo moto notice for reversal of orders and thereafter passed reversal order Whether reversal orders passed were barred by time limitation Held that - Section 22(4) imposes limitation of four years for reversing assessment orders Impugned order which was served on assessee on 21.09.2011 was ante-dated order passed only to circumvent limitation of four years provided under Sub-section(4) of Section 22A of KST Act Serving copies of order after more than 1 years of date of order was unjustified On said ground alone impugned order quashed Decided in favour of Assesse.

Summary

Issues:
1. Ante-dating of a revisional order to overcome the limitation under Section 22A of the Karnataka Sales Tax Act, 1957.
2. Validity of an order dated 10.02.2010 passed by the Additional Commissioner of Commercial Taxes.

Issue 1: Ante-dating of Revisional Order
The case involved an officer ante-dating an order of revision to avoid the limitation under Section 22A of the KST Act. The penalty was initially imposed on the assessee under Section 5A(3)(i) of the KST Act, which was later set aside by the Joint Commissioner of Commercial Taxes. Subsequently, the Additional Commissioner of Commercial Taxes issued a notice for revising the order dated 18.03.2006 under Section 22A of the KST Act. The reply to this notice was filed by the appellant on 20.03.2010, received in the respondent's office on 08.04.2010. The impugned order dated 10.02.2010 referred to the reply filed on 08.04.2010, which was beyond the four-year limitation period. The court found that the order was ante-dated to circumvent the limitation and quashed it, imposing exemplary costs on the respondent.

Issue 2: Validity of the Order
The court observed an inordinate delay of 1 year and 7 months in serving the order dated 10.02.2010 on the appellant. The original record confirmed that the reply of the appellant was received on 08.04.2010, while the order was dispatched for service on 15.09.2011 and served on the appellant on 21.09.2011. Due to the delay in serving the order and the apparent ante-dating of the order, the court held that the order deserved to be quashed. The court allowed the appeals, quashed the order dated 10.02.2010, and directed the respondent to pay exemplary costs to the appellant. It was further clarified that the cost could be recovered from the official responsible for passing the ante-dated order after due enquiry, in accordance with the law.

In conclusion, the High Court of Karnataka found the practice of ante-dating orders to circumvent limitations unacceptable and quashed the impugned order dated 10.02.2010. The court imposed exemplary costs on the respondent and directed the recovery of costs from the official responsible for the ante-dated order.