2018 (7) TMI 398 - HC - VAT and Sales Tax

Validity of Revision of assessment order - Amnesty Scheme 2004 - Works contract - Whether on the facts and in the circumstances of the case, the Tribunal is justified in upholding the order of revision of assessment order , though it is passed, after the assessment order reached to finality, in view of the order passed under the Amnesty Scheme 2004 ? - Held that - The Amnesty Scheme, 2004 was itself subject to the department having right to pass further statutory orders for enhancement of tax, penalty or interest even in respect of the orders for which Amnesty is granted. This of course is subject to the benefit under the Scheme not being disturbed. It is not the case of the Applicant that benefit availed/granted under the Scheme is being disturbed. Therefore, Applicant was aware of the assessment order being subject to further proceedings while seeking to avail the benefit of the Amnesty Scheme. It is undisputed position before us that benefit which was granted under the Amnesty Scheme continues to be in favour of the Applicant. There is no variation in the same - In view of self evident position of law, the question as proposed does not give rise to any question of law which would warrant disturbing the order dated 27.4.2017, rejecting the application to refer the question of law to this Court. Whether on the facts and in the circumstances of the case, the Tribunal is justified in holding that we are of the view, that tax is assessed properly @4% instead of 2%, though composition and not the tax has been levied by the revising authority? - Held that - No fault can be found with the order dated 27.4.2014 of the Tribunal holding that proposed question does not arise from the order dated 7.7.2016 of the Tribunal - the question does not give rise to any question of law which would warrant directing the Tribunal to refer this question for our consideration. Application dismissed.

Summary

Issues:
Application under Section 9(1) of the Maharashtra Sales Tax Act seeking direction to refer questions of law arising out of Tribunal's order dated 7.7.2016.
1. Whether Tribunal was justified in upholding the revision of assessment order after it reached finality under the Amnesty Scheme 2004?
2. Whether Tribunal was justified in holding that tax was assessed properly at 4% instead of 2% under the Works Contract Act?

Analysis:

Issue 1:
The Applicant, a registered works contractor, was assessed to composition tax at 2% for the Financial Year 1999-2000. The Applicant availed the Amnesty Scheme in 2004, paying a reduced amount to the Revenue, and the balance was waived, finalizing the assessment. However, the Deputy Commissioner revised the assessment later, levying a 4% composition tax, which was challenged by the Applicant. The Tribunal rejected the Applicant's contention, stating that there is no bar under the Act to revise an assessment order under Section 57 of the Sales Tax Act. The Tribunal also found that the tax was properly assessed at 4% based on the nature of the work done. The Applicant argued that without canceling the Amnesty Scheme order, the Revenue cannot revise the assessment order. However, the Tribunal held that as per the Amnesty Scheme, the Revenue had the right to pass further orders for enhancement of tax, penalty, or interest, even after granting amnesty. The Tribunal concluded that the Applicant was aware of the possibility of further proceedings when availing the Amnesty Scheme benefits, and since the benefit was not disturbed, the revision was justified. The High Court upheld the Tribunal's decision, stating that the proposed question did not give rise to any legal issue warranting a reference to the Court.

Issue 2:
Regarding the second question pressed by the Applicant, the Tribunal noted that during the appeal leading to the order dated 7.7.2016, the Applicant did not press the grievance related to this issue. Therefore, the Tribunal found no fault in rejecting the application to refer this question to the Court. The High Court concurred with the Tribunal's decision, stating that Question No.2 did not raise any legal issue necessitating a reference for consideration. Consequently, the High Court dismissed the application, emphasizing that neither of the questions posed warranted further legal intervention or reference to the Court.