2017 (11) TMI 1982 - HC - VAT and Sales Tax

Jurisdiction - Validity of assessment - power of respondent no. 4 to make a fresh assessment in pursuance of the remand order - suo motu revisional proceedings are pending before respondent No. 2 - HELD THAT - When this case came up for admission on 10-11-2017 learned Special Standing Counsel for Commercial Taxes (A.P.) requested for an adjournment for instructions. Today on instructions he has not disputed the fact that the suo motu revisional proceedings initiated by respondent No. 2 are still pending. When the suo motu revisional proceedings of respondent No. 2 are pending with reference to the remand order of respondent No. 3 against the order dated 25-07-2012 of respondent No. 4 respondent No. 4 is denuded of jurisdiction to pass a fresh assessment order purporting to comply with the remand order of respondent No. 3. It is found from the impugned proceedings of respondent No. 4 that the specific objection raised by the petitioner in this regard has not been dealt with. The impugned assessment order of respondent No. 4 cannot be sustained - Petition allowed.

Summary

Issues:

1. Jurisdiction of respondent No. 4 to pass a fresh assessment order while suo motu revisional proceedings are pending before respondent No. 2.

Analysis:

The Writ Petition was filed seeking a mandamus to set aside the order in Rc.No. 48/2014/SA2 dated 26-09-2017 of respondent No. 4. The petitioner, a VAT-registered dealer, was assessed tax for the year 2010-11 by respondent No. 4. The petitioner appealed to respondent No. 3, who remanded the case back to respondent No. 4. Subsequently, respondent No. 2 initiated suo motu revisional proceedings against the order of respondent No. 3. While these revisional proceedings were ongoing, respondent No. 4 issued a show-cause notice for a fresh assessment based on the remand order. The petitioner objected, stating that respondent No. 4 lacked jurisdiction to make a fresh assessment while the revisional proceedings were pending. Despite this objection, respondent No. 4 proceeded with the assessment.

Upon hearing the case, the Court noted that the revisional proceedings initiated by respondent No. 2 were still pending. The Court held that in such circumstances, respondent No. 4 did not have the jurisdiction to pass a fresh assessment order to comply with the remand order from respondent No. 3. The Court observed that respondent No. 4 failed to address the specific objection raised by the petitioner regarding jurisdiction in the impugned proceedings. Consequently, the Court found that the impugned assessment order by respondent No. 4 could not be sustained and was set aside. The Writ Petition was allowed, with the clarification that the petitioner's tax liability depended on the outcome of the revisional proceedings before respondent No. 2.

In conclusion, the Court set aside the impugned assessment order of respondent No. 4, emphasizing that respondent No. 4 lacked jurisdiction to make a fresh assessment while the revisional proceedings were pending before respondent No. 2. The Court's decision highlighted the importance of addressing objections raised by parties and ensuring proper jurisdictional authority in tax assessment matters.