2019 (4) TMI 1323 - HC - VAT and Sales Tax

Service of notice - validity of assessment order - ex parte proceedings - no notice was ever served on assessee,- HELD THAT - As it is clear from the perusal of order of the assessing authority that the notice under Section 21(2) was served on the assessee but he did not participate in the reassessment proceedings and further neither the first appellate authority nor the Tribunal has recorded any finding or has come to conclusion that no notice was served on the assessee it was only the contention of the assessee which was recorded by the Tribunal while remanding back the matter to the assessing authority for decision afresh. No interference is required as the present revision is against a remand order, however, it is made clear that the assessing authority while passing the order shall first consider whether the notice under Section 21(2) of the Act was served on the assessee and further the proceedings are time barred or not. After considering the said question, the assessing authority shall pass the order as directed by the Tribunal. Revision disposed off.

Summary

Issues:
1. Validity of reassessment proceedings under Section 21(2) of the U.P. Trade Tax Act.
2. Justifiability of the Tribunal's decision to remand the matter back to the assessing authority.
3. Examination of the distinction between the present case and the judgment in M/s Om Traders Vs. Commissioner of Trade Tax.

Analysis:
1. The judgment dealt with a case involving the validity of reassessment proceedings under Section 21(2) of the U.P. Trade Tax Act for the assessment year 2006-07. The revisionist, a registered dealer in iron and steel, was issued a notice under Section 21(2), leading to a tax imposition of ?13,70,807. An appeal against this assessment was rejected by the Additional Commissioner, Grade-II (Appeal) Trade Tax. Subsequently, the Tribunal remanded the matter back to the assessing authority, setting aside the previous orders due to lack of valid service of notice on the assessee.

2. The Tribunal's decision to remand the matter was challenged by the revisionist, arguing that the Tribunal should not have done so after finding no valid service of notice under Section 21 on the assessee. The respondent, however, contended that the Tribunal had not conclusively determined the issue of notice service and remanded the matter for fresh consideration by the assessing authority. The Court noted the distinction from the judgment in M/s Om Traders case, emphasizing that the Tribunal in the present case did not explicitly find that the notice was not served, but merely noted the assessee's contention.

3. Upon considering the rival submissions and case law, the Court found that the Tribunal's decision was based on the assessee's contention rather than a conclusive finding of non-service of notice. The Court clarified that interference was not necessary as the revision was against a remand order. However, it directed the assessing authority to first determine the service of notice under Section 21(2) and assess the proceedings' timeliness before passing any order, in accordance with the Tribunal's directions. The Court disposed of the revision accordingly.