2016 (1) TMI 509 - HC - VAT and Sales Tax

Rectification of error apparent on the face of the orders of revised assessment - Tamil Nadu Value Added Tax Act, 2006 (TNVAT) - scope and jurisdiction of the first respondent, while exercising powers u/s 84 - Held that - the power of the first respondent under Section 84 of the TNVAT Act, 2006 is neither limited nor circumscribed as understood by the first respondent in the impugned orders. As pointed out by the Honourable Division Bench, an order passed contrary to the provisions of the statute or the judgments of the High Court or the Supreme Court, which are covered on the issue and binding on the Authorities, when not considered or when the factual aspect has not been correctly stated, a mistake would occur on the face of the record. It has to be undoubtedly held that the impugned orders do not address the real issue and that the finding rendered by the first respondent in the penultimate paragraph of the impugned orders is not legally tenable. One more error, which is apparent on the face of the orders passed by the first respondent, is that there is no endeavour made by the third respondent to examine as to whether the error sought to be pointed out by the petitioner was an error apparent on the face of the records. However, being guided by the principle that only the arithmetical and clerical errors could be corrected, the first respondent rejected the petitions under Section 84 of the TNVAT Act, 2006. Hence, the impugned orders call for interference on this technical ground. The writ petitions are allowed, the impugned orders are set aside and the matters are remitted back to the first respondent for fresh consideration - matter remanded back - Decided in favor of assessee.

Summary

Issues:
Scope and jurisdiction of the Assessing Authority under Section 84 of the TNVAT Act, 2006.

Analysis:
The petitioner, a registered dealer under the TNVAT Act, 2006, challenged revised assessments issued by the Assessing Authority. The Assessing Authority rejected the petitioner's petitions under Section 84 of the TNVAT Act, 2006, stating that the provision could only be used for correcting clerical and arithmetical mistakes. The key legal issue was the scope and jurisdiction of the Assessing Authority under Section 84. The High Court referred to a previous Division Bench decision which clarified that the power to rectify errors under Section 84 is not limited to clerical errors but extends to reviewing decisions based on errors apparent on the face of the record.

The High Court cited precedents emphasizing that errors apparent on the face of the record include orders contrary to statutes or binding judgments, factual inaccuracies, or failure to consider relevant legal principles. The court highlighted that a rectifiable mistake must be obvious and not subject to debate or multiple interpretations. It also noted that failure to consider court judgments leading to a reduction in tax could constitute an error apparent on the face of the record. The court reiterated that the Assessing Authority has the power to review decisions based on such errors.

In a previous case, the High Court had held that the power under Section 84 allows the Authority to rectify any error apparent on the face of the record, indicating a broader scope beyond mere arithmetic or clerical errors. The court emphasized that the Assessing Authority must consider errors based on legal provisions or binding judgments, and failure to do so renders the decision legally untenable. The court directed the Assessing Authority to reconsider the petitioner's case, examine if there are errors apparent on the face of the record, and issue a reasoned decision within a specified timeframe, based on legal principles outlined in relevant judgments.

In conclusion, the High Court allowed the writ petitions, set aside the impugned orders, and remitted the matters back to the Assessing Authority for fresh consideration. The Assessing Authority was instructed to evaluate the petitioner's submissions under Section 84, determine if there are errors apparent on the face of the records, and issue a new decision within eight weeks, considering the legal principles discussed in the court's analysis.