2022 (1) TMI 663 - HC - VAT and Sales Tax

Recovery of dues - Attachment of Bank Accounts - petitioner neither charged Value Added Tax nor remitted the tax on the sales effected under the provisions of the Tamil Nadu Value Added Tax Act, 2006 - Section 22(6) of the TNVAT Act, 2006 - HELD THAT - Though the petitioner has been both negligent in neither filing the returns nor by filing reply to the notices which preceded passing of the first mentioned impugned order dated 28.10.2016 of the first respondent and failed to answer the subsequent notices issued by the first respondent asking the petitioner to pay the arrears of tax, the facts on record also indicates that the petitioner had filed a petition under Section 22(6) of the TNVAT Act, 2006 for revision of the order dated 28.09.2016 in time. Since the petition has not been disposed, the impugned recovery cannot be proceeded immediately, as the aforesaid petition of the petitioner for revision of the Assessment Order has not been disposed in accordance with law. This Writ Petition is disposed by directing the second respondent to pass appropriate orders on the petition dated 26.10.2016 of the petitioner filed under Section 22(6) of the TNVAT Act, 2006, within a period of thirty days from the date of receipt of a copy of this order.

Summary

Issues:
Challenge to impugned order and recovery notice for Assessment Year 2013-2014 under TNVAT Act, 2006.

Analysis:
The petitioner contested an order dated 28.09.2016 and a subsequent recovery notice for the Assessment Year 2013-2014 under the Tamil Nadu Value Added Tax Act, 2006. The petitioner argued that due to being unaware of the TNVAT Act requirements, they did not charge or remit Value Added Tax on sales, believing they were exempt due to turnover below a certain threshold. A petition for revision of the order was filed on 26.10.2016 under Section 22(6) of the TNVAT Act, seeking a lawful disposal of the petition and suspension of the recovery proceedings until then.

The petitioner's counsel contended that the petitioner assumed the petition under Section 22(6) was accepted, leading to surprise upon receiving the recovery notice. The Additional Government Pleader opposed, stating that despite multiple notices to pay the disputed tax, the petitioner did not respond. The Pleader argued that the petitioner should have sought relief earlier through Mandamus or reminders to the authorities, deeming the case unsuitable for interference and requesting dismissal of the writ petition.

The Court acknowledged the petitioner's negligence in not filing returns or responding to notices but noted the timely filing of the revision petition under Section 22(6) of the TNVAT Act. As the said petition remained unresolved, the Court directed the second respondent to decide on the petitioner's petition within thirty days, suspending all recovery proceedings until the final outcome. The judgment concluded without costs, closing all related petitions.