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2020 (11) TMI 154 - HC - VAT and Sales TaxVires of Bihar Entry of Goods into Local Area for Consumption, Use or Sale Therein (Amendment and Validation) Act, 2008 - ex-parte assessment order - It is the argument of the petitioner that the schedule under the amendment Act, 2007 wholly substituted the schedule under the principal Act, which also meant that all notifications prescribing rate of tax for the scheduled goods stood repealed - HELD THAT - SO 95 dated July 31, 2008 which prescribes that the said Notifications were to come into force with effect from April 1, 2008 is merely clarificatory in nature and in any event would not supersede or substitute the earlier Notifications, i.e. SO 92, SO 159; or SO 99. It is a settled principle of law that fiscal statutes need to be interpreted and applied strictly and the benefit of doubt, if at all, would enure in favour of the assessee. However, it is equally settled that if the assessee is liable to be subjected to incidence of taxation, then he must abide by and be dutiful in paying the tax, expeditiously, and in accordance with law - Upon perusal of the impugned assessment order dated August 25, 2011 passed by the Assistant Commissioner of Commercial Taxes, Gopalganj Circle, Gopalganj, which according to Shri Vikash Kumar, the learned counsel for the Revenue, is not placed fully on record, we notice that he same was passed in the absence of the assessee and was ex parte in nature. The order appears to have been passed without proper application of mind. Even the order passed by the Revisional Authority, running into one and a half pages, to say the least, is cryptic in nature, not even referring to, much less dealing with the contentions raised by the petitioner. The Assessing Officer shall pass a fresh order with respect to the assessment in issue, i.e., assessment years 2006-07 and 2007-08 - Petition allowed by way of remand.
Issues Involved:
1. Constitutional validity of the Bihar Entry of Goods into Local Area for Consumption, Use or Sale Therein (Amendment and Validation) Act, 2008. 2. Validity of ex-parte assessment order and demand notice. 3. Validity of the order passed by the Commissioner of Commercial Taxes. 4. Applicability of Entry Tax for the period 29.08.2006 to 31.03.2008. 5. Procedural fairness and application of mind by the Assessing and Revisional Authorities. Detailed Analysis: 1. Constitutional Validity of the Bihar Entry of Goods into Local Area for Consumption, Use or Sale Therein (Amendment and Validation) Act, 2008: The petitioner initially challenged the constitutional validity of the Validating Act, 2008, claiming it was ultra vires Articles 14, 19(1)(g), 300A, and 301 of the Constitution of India. However, the petitioner’s counsel later clarified that they do not press for this relief. Consequently, prayers (i) and (ii) were disposed of without further consideration. 2. Validity of Ex-Parte Assessment Order and Demand Notice: The petitioner challenged the ex-parte assessment order and demand notice dated 25.10.2020, which imposed an Entry Tax liability of ?1,27,38,086.00, with a net demand of ?99,33,576.00 for the period 1.4.2007 to 31.3.2008. The court noted that the assessment order was passed in the absence of the assessee and was ex-parte in nature. The court found that the Assessing Officer did not properly address the objections raised by the petitioner, indicating a lack of proper application of mind. 3. Validity of the Order Passed by the Commissioner of Commercial Taxes: The order dated 30.9.2011 by the Commissioner of Commercial Taxes, which dismissed the revision petition against the assessment order, was also challenged. The court observed that the Revisional Authority’s order was cryptic and did not address the contentions raised by the petitioner. The court found the order to be lacking in detailed reasoning and application of mind. 4. Applicability of Entry Tax for the Period 29.08.2006 to 31.03.2008: The petitioner argued that the amendment Act of 2007 substituted the schedule under the principal Act, thereby repealing all notifications prescribing the rate of tax for scheduled goods. They contended that no applicable rate of tax existed between 29.08.2006 and 31.07.2008. However, the court disagreed, citing the savings clause in the amendment Act, 2007, which ensured that previous notifications continued to have force. The court referred to established legal principles regarding savings clauses, emphasizing that they preserve rights and liabilities accrued under the repealed enactment. 5. Procedural Fairness and Application of Mind by the Assessing and Revisional Authorities: The court emphasized the need for fiscal statutes to be interpreted and applied strictly, ensuring procedural fairness. It noted that the assessment order lacked detailed reasoning and did not address the petitioner’s objections. Similarly, the Revisional Authority’s order was found to be cursory and lacking in detailed analysis. The court concluded that both orders were passed without proper application of mind. Conclusion and Directions: The court quashed the impugned orders and consequential demands, directing the Assessing Officer to pass a fresh order for the assessment years 2006-07 and 2007-08. The proceedings were to be conducted expeditiously, with the petitioner required to cooperate and not seek unnecessary adjournments. The court clarified that the issue of the validity of the Act was not to be adjudicated further. Any amount deposited by the petitioner was to be adjusted against future demands, with excess amounts to be refunded within three months, subject to the proceedings attaining finality. Final Disposition: The writ petition was allowed with the above terms, and any interlocutory applications were disposed of accordingly.
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