2017 (2) TMI 520 - HC - VAT and Sales Tax

Re-assessment - matter was on remand - the first respondent, being the assessing authority, instead of undertaking the re-assessment, has simply proceed to pass the present impugned order. Whether the impugned order valid? - Held that - re-assessment has not been done by the first respondent before passing the impugned orders in accordance with the directions issued by the appellate authority. This position cannot be controverted by the learned Additional Government Pleader appearing for the respondents also. Therefore, this Court is of the view that the impugned orders shall not stand in the legal scrutiny as if an authority is directed to do a particular thing in a particular manner, the same has to be done only in that manner not otherwise. Here, in the case in hand, though a categorical direction was given by the appellate authority, the same has not been followed by the Assessing Authority and, therefore, the impugned orders followed by the non- consideration on the part of the first respondent would not stand in the legal scrutiny and, therefore, this Court has no hesitation to quash the said impugned orders. The matter can be remanded back to the Assessing Authority to re-assess the entire issue strictly in accordance with the directions issued by the appellate authority - petition allowed in part by way of remand.

Issues:
1. Non-compliance with directions for re-assessment by the Assessing Authority.
2. Impugned orders passed without following mandatory directions.
3. Justifiability of completing assessment despite non-compliance.
4. Comparison with previous judgment regarding forged 'C' Forms.
5. Consideration of setting aside orders and taxation implications.

Issue 1: Non-compliance with directions for re-assessment by the Assessing Authority
The High Court considered a batch of cases where the Assessing Authority failed to conduct re-assessment as directed by the appellate authority. The petitioners argued that the impugned orders were passed without following the specific directions for re-assessment. The court acknowledged that the first respondent did not undertake re-assessment in accordance with the appellate authority's directions, leading to a lack of compliance with the mandated procedure.

Issue 2: Impugned orders passed without following mandatory directions
The court noted that the impugned orders were based on reasons that did not align with the directions provided by the appellate authority. The petitioners contended that the Assessing Authority did not adhere to the specific instructions for re-assessment, which rendered the impugned orders legally questionable. The court found that the impugned orders did not meet the legal scrutiny due to the failure to follow the prescribed procedure.

Issue 3: Justifiability of completing assessment despite non-compliance
The court deliberated on whether completing the assessment was justifiable in light of the Assessing Authority's failure to conduct re-assessment as directed. The Additional Government Pleader argued that non-compliance with the re-assessment exercise should not absolve the petitioners from taxation obligations. However, the court emphasized that failure to follow the appellate authority's directions invalidated the impugned orders, warranting their quashing.

Issue 4: Comparison with previous judgment regarding forged 'C' Forms
The court referenced a previous judgment involving forged 'C' Forms issued by Department officials, where the court intervened to protect petitioners and directed action against the officials. The court distinguished the present case, highlighting the Assessing Officer's non-compliance with the appellate authority's directions as the primary issue, necessitating a different course of action.

Issue 5: Consideration of setting aside orders and taxation implications
The court considered the implications of setting aside the impugned orders due to non-compliance with the re-assessment directions. While acknowledging the taxation implications, the court emphasized the importance of following prescribed procedures and directed the matter to be remanded back to the Assessing Authority for re-assessment in strict accordance with the appellate authority's directions within a specified timeframe.

In conclusion, the High Court allowed the Writ Petitions in part, quashing the impugned orders due to non-compliance with the appellate authority's directions and directing the Assessing Authority to conduct re-assessment as per the prescribed procedure within a stipulated period.

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