2017 (10) TMI 487 - HC - VAT and Sales Tax

Mismatch between the Annexure 1 and Annexure 2 returns filed by the petitioner and the other end dealer - Held that - the Assessing Officer has taken certain efforts to furnish the invoice numbers and other details, though it may be true in respect of certain transactions, the full details have not been mentioned. In any event, wherever full details have been given, the dealer was bound to give proper explanation. If the dealer wants further information, he should have asked the Assessing Officer by submitting a representation. However, in the instant case, the dealer did not resort to such a procedure, but merely, submitted an objection without giving any proper details. Therefore, substantial part of the fault lies on the dealer. Assuming that the petitioner had furnished all those details, then the Assessing Officer has to embark upon an enquiry reconcile the details furnished by the dealer with that of the information available in the website and then complete the assessment. This Court is of the view that the petitioner can be afforded one more opportunity to explain with regard to the transactions - the Writ Petitions are disposed of, by directing the petitioner to pay 15% of the disputed tax for each of the assessment years, within a period of fifteen days from the date of receipt of a copy of this order.

Summary

Issues:
Challenge to assessment orders under Tamil Nadu Value Added Tax Act for years 2012-13 to 2015-16 due to mismatch in returns filed by petitioner and other dealer.

Analysis:
The petitioner, a registered dealer under the TNVAT Act, challenged assessment orders for various years due to discrepancies in Annexure 1 and Annexure 2 returns filed by them and the other dealer. Show cause notices were issued proposing assessment revision for the relevant years.

The major issue in all cases was the mismatch between returns, leading to the issuance of revision notices. The petitioner's objections to the revision notices were considered inadequate and lacking in detail, prompting the respondent to proceed with the assessment and pass the impugned orders.

The petitioner argued that the details in the revision notice were insufficient, no proper enquiry was conducted, and essential information like commodity codes and invoice numbers were missing. However, the court found that the revision notices did contain necessary details, and the petitioner failed to provide a satisfactory explanation or reconcile discrepancies in their reply to the objections.

The court emphasized the dealer's duty to explain discrepancies factually and highlighted the importance of providing proper details for assessment purposes. Referring to a previous case, the court outlined the procedure for conducting enquiries in mismatch cases and stressed the need for careful assessment based on available information.

Ultimately, the court granted the petitioner an opportunity to explain transactions with full details and request additional information for other transactions. The petitioner was directed to pay 15% of the disputed tax for each assessment year within fifteen days. Failure to comply would result in dismissal of the petitions, allowing the petitioner to pursue appellate remedies under the Act.

In conclusion, the court's decision allowed the petitioner a chance to rectify discrepancies in assessment orders by providing comprehensive explanations and complying with the specified conditions.