2020 (1) TMI 1438 - HC - VAT and Sales Tax

Validity of assessment order - time limitation - notices for audit assessments in relation to such returns were issued, however, no final orders of assessment were passed before the period of limitation prescribed under the Act - HELD THAT - In similar circumstances in the case of SHRI PANKAJ BEHARI SAHA VERSUS THE STATE OF TRIPURA, THE PRINCIPAL SECRETARY, FINANCE DEPARTMENT, GOVERNMENT OF TRIPURA, 2020 (1) TMI 892 - TRIPURA HIGH COURT where it was held that respondent authorities cannot be allowed to circumvent the limitation provision for completing audit assessment by permitting resort to the powers of summary adjustments under Section 27 which are peculiar in nature and are available only in case where notice under sub-section (2) of Section 24 of the Act has been issued to a dealer. The impugned notices and consequential orders are set aside. Demand notices subsequent to such orders should also stand invalidated - petition allowed.

Summary

Issues involved:
Challenge to show cause notices dated 31.01.2019 and 11.02.2019, and the consequential order by the Superintendent of Taxes dated 10.06.2019.

Analysis:
The petitioner challenged the show cause notices and consequential order issued by the Superintendent of Taxes. The High Court referred to a previous case where similar show cause notices were set aside. The judgment highlighted the differences in provisions under Section 27, self-assessment under Section 29, provisional assessment under Section 30, and audit assessment under Section 31 of the TVAT Act. It emphasized that special powers under Section 27 can only be exercised after a notice is issued by the Commissioner under Section 24. Without such a notice, the TVAT authorities cannot invoke the powers under Section 27. The Court noted that allowing summary adjustments under Section 27 without the necessary notice would circumvent the limitation provision for completing audit assessment under Section 33. Consequently, the impugned orders under Section 27 were set aside, and any demand notices resulting from those orders were invalidated.

The judgment concluded by setting aside the impugned notices and consequential orders, with demand notices subsequent to those orders also being invalidated. The petition was allowed and disposed of accordingly, including any pending applications. The Court's decision was based on the legal provisions of the TVAT Act and the necessity for proper issuance of notices before invoking specific powers under the Act.