2018 (10) TMI 1150 - HC - VAT and Sales Tax

Validity of assessment order - credit of tax paid - petitioner did not produce books of accounts when asked for - Held that - It only serves the ends of justice if the petitioner suffers any order after a full opportunity. The opportunity he earlier had may have not been utilised for the petitioner laboured under an impression that Ext.P2 appellate order is conclusive and the assessment authority s demand for production of records travels beyond his remit as fixed in the appellate order. There is an element of ambiguity in the appellate order. In one breath, it accepts the petitioner s entire contention. In the other breath, it allows the assessing authority to examine the petitioner s plea. Thus, whether that examination includes summoning of the records afresh is a question that has no easy answer. The petitioner s initial refusal is condonable - the Ext.P5 assessment order is set aside and the matter remanded to the assessing officer.

Summary

Issues:
1. Interpretation of appellate order under the Kerala Value Added Tax Act (KVAT Act) for 2010-11 and 2011-12.
2. Failure to produce books of account by the petitioner leading to restoration of the assessment order.
3. Dispute regarding remand of the matter to the assessing authority.
4. Consideration of alternative remedy and the jurisdiction of the High Court under Article 226 of the Constitution of India.

Analysis:

1. The petitioner, an assessee under the KVAT Act, initially challenged the assessment order for 2010-11 and 2011-12. The appellate authority, through Ext.P2 order, directed the assessing authority to verify certain submissions and grant credit for tax paid on purchases if applicable. However, the matter was remanded when the petitioner failed to produce books of account, leading to the restoration of the original assessment order.

2. During the proceedings, the petitioner's counsel acknowledged the need to produce the required records and requested a remand to the assessing authority. The Government Pleader opposed the remand, arguing that the petitioner's belated concession should not nullify the assessment order. The High Court, considering the circumstances, decided against relegate the petitioner to an appellate forum, citing Article 226 of the Constitution of India and the need for a full opportunity for the petitioner.

3. The High Court noted an ambiguity in the appellate order, where it appeared to accept the petitioner's contentions while also allowing the assessing authority to examine further. This ambiguity justified the petitioner's initial refusal to produce records. Ultimately, the High Court set aside the assessment order and remanded the matter to the assessing officer for adjudication based on the observations in the Ext.P2 appellate order.

4. In conclusion, the High Court disposed of the writ petition without delving into the merits of the case, emphasizing the importance of providing the petitioner with a fair opportunity to present their case and clarifying the scope of examination by the assessing authority based on the appellate order.