9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (9) TMI 1802 - HC - VAT and Sales TaxLimitation under Section 6(5) of the Central Sales Tax Rules, 1957 - period of limitation for completion of assessment - CST Act - KGST Act - Held that - Under the the CST Rules the limitation, to proceed to determine is four years as provided under Rule 6(7). Looking at the nature of the statute and the rights and liabilities thereunder, we are of the opinion that there could be a reasonable period prescribed of five years for initiation of proceedings for completion of assessment under the CST Act also. We say this because the four year limitation under Rule 6(7) (8) is for assessment of escaped turnover; while Rule 6(5) contemplates an assessment at the first instance after the return is filed. Under the value added tax regime even for assessment of escaped turnover the limitation is five years; for initiation of proceedings. Hence we find the same to be reasonable for proceeding to carry out the assessment after the return is filed; under the CST Act. Reliance is placed on sub-clause (iii) tocontend that the CST assessment has to be treated as pending for the purpose of Section 23 and the time limit mentioned therein shall not be applicable in such cases. We have to notice that the amendments have been brought in after the limitation expired in certain cases, which is before us for consideration. In any event, we have to emphasise that the provision brought in is for extension of period for the purpose of Section 25, which speaks of an assessment of escaped turnover and not the initial completion of assessment. We are of the opinion that the provision would have no application to the present set of cases - The cases in which notices alone wereissued and completion of assessment has not been effected, wherever it has been upheld, necessarily the assessee would be entitled to file objections within 30 days from the date of receipt of the certified copy of this judgment and the Assessing Officer would complete the proceedings in accordance with law, leaving open the remedy of the assessee to file statutory appeals as against the quantum, but not against the question of limitation. The assessment orders wherever they have been upheld, have been upheld only on the question of limitation.
Issues Involved:
1. Limitation under Section 6(5) of the Central Sales Tax Rules, 1957. 2. Interpretation of the Kerala Value Added Tax Act, 2003 and the Kerala General Sales Tax Act, 1963. 3. Applicability of precedents and statutory provisions to the completion of assessments. 4. Reasonable period for completion of assessments. 5. Impact of amendments to the KVAT Act on pending assessments. 6. Individual case analysis based on the limitation period. Issue-wise Detailed Analysis: 1. Limitation under Section 6(5) of the Central Sales Tax Rules, 1957: The core issue in the writ appeals was the limitation period for completing assessments under Section 6(5) of the CST Rules. The State argued that no specific limitation period was provided under Rule 6(5), while the learned Single Judge held that assessments should be completed within a reasonable time, which was considered to be four years. 2. Interpretation of the Kerala Value Added Tax Act, 2003 and the Kerala General Sales Tax Act, 1963: Before the KVAT Act, the KGST Act provided a four-year limitation for assessments. With the introduction of the KVAT Act, assessments were deemed completed if returns were filed correctly. The KVAT Act allowed a five-year period for assessing escaped turnover. The CST Act assessments continued under the CST Rules, with no specific limitation under Rule 6(5). 3. Applicability of Precedents and Statutory Provisions: The learned Government Pleader cited the Division Bench decision in Parisons Foods (P) Ltd. v. State of Kerala, which held that the limitation under sub-rule (7) or (8) could not be adopted for sub-rule (5) of Rule 6. The Supreme Court's decisions in Bhattinda District Co-operative Milk Producers India Ltd. and Bharat Steel Tubes Ltd. were also considered, emphasizing that assessments should be completed within a reasonable time, even if no specific period was provided by statute. 4. Reasonable Period for Completion of Assessments: The Court concluded that a reasonable period for completing assessments under Rule 6(5) of the CST Rules would be five years, aligning with the KVAT Act's provision for escaped turnover assessments. This period was deemed appropriate considering the nature of the statute and the rights and liabilities involved. 5. Impact of Amendments to the KVAT Act on Pending Assessments: The amendments to Section 42 of the KVAT Act, which extended the period for completing assessments, were found not applicable to the cases under consideration. The Court emphasized that these amendments were intended for assessments of escaped turnover, not the initial completion of assessments. 6. Individual Case Analysis: - W.A. No.1211 of 2017: Assessment year 2008-2009, notice issued on 17.03.2016, beyond the five-year period. Appeal rejected. - W.A. No.1215 of 2017: Assessment year 2010-2011, notice issued on 15.09.2015, within the five-year period. Appeal allowed. - W.A. No.1264 of 2017: Assessment year 2010-2011, notices issued on 18.01.2016 and 30.01.2016, within the five-year period. Appeal allowed. - W.A. No.1265 of 2017: Assessment year 2009-2010, notice issued on 10.07.2015, beyond the limitation period. Appeal rejected. - W.A. No.1270 of 2017: Assessment year 2009-2010, notice received on 18.02.2016, beyond the limitation period. Appeal rejected. - W.A. No.1291 of 2017: Assessment years 2006-2007 and 2007-2008, notices issued on 04.03.2016, beyond the limitation period. Appeal rejected. - W.A. No.1172 of 2017: Assessment years 2008-2009 and 2009-2010, notices issued on 24.01.2015 and 31.01.2015. Appeal partly allowed, upholding the assessment for 2009-2010. - W.A. No.1175 of 2017: Assessment year 2010-2011, notice issued on 11.01.2016, within the limitation period. Appeal allowed. - W.A. No.1179 of 2017: Assessment year 2009-2010, notice issued on 17.08.2016, beyond the limitation period. Appeal rejected. - W.A. No.1233 of 2017: Assessment year 2007-2008, notice issued on 07.11.2015, beyond the limitation period. Appeal rejected. - W.A. No.1333 of 2017: Assessment years 2006-2007, 2007-2008, and 2008-2009, notices issued on 23.01.2015, beyond the limitation period. Appeal rejected. - W.A. No.1284 of 2017: Assessment years 2007-2008 to 2010-2011, notices issued on 14.10.2015. Appeal partly allowed, sustaining the assessment for 2010-2011. - W.A. No.1189 of 2017: Assessment year 2009-2010, notice issued on 13.08.2015, beyond the limitation period. Appeal rejected. - W.A. No.1188 of 2017: Assessment year 2008-2009, notice issued on 25.02.2016, beyond the limitation period. Appeal rejected. Conclusion: The Court ordered that in cases where notices were upheld, the assessees could file objections within 30 days from the receipt of the judgment, and the Assessing Officer should complete the proceedings in accordance with the law. The assessment orders were upheld only on the question of limitation, and the assessees were allowed to challenge the quantum within 30 days. Parties were left to bear their respective costs.
|
