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2022 (11) TMI 1272 - HC - VAT and Sales TaxRe-assessment - Time limitation for notices issued - period of limitation enhanced from 5 years to 6 years - Prospective or retrospective amendment - whether the notices issued are within the period of limitation stipulated by the amended provision and also before a right accrued in favour of the dealer? - HELD THAT - When the provision is amended enhancing the period of limitation from 5 years to 6 years, the issuance of notice is well within the jurisdiction, and no exception could be taken. The argument of the respondents is accepted by this Court then, the amendment made through Finance Act 11/2017 is made more prospective than what is intended by the Legislature and the judgments of this Court. The subtle attempt made to sustain the judgments under appeal does not find favour with us for the above reasons. Hence, the judgments under appeal are set aside. The dealers/respondents herein are given liberty to file appeal before the Appellate Authority by enclosing a copy of the judgment within four weeks from today. The delay occasioned during the pendency of the appeal and the writ petition is excused. Appeals are allowed.
Issues:
1. Applicability of the principle laid down in Baiju A A v. State Tax Officer. 2. Interpretation of the amended provision under Section 25 of the KVAT Act. 3. Determination of the period of limitation for issuing reassessment notices. 4. Whether the Amending Act is prospective or retrospective. Analysis: Issue 1: Applicability of the principle laid down in Baiju A A v. State Tax Officer The judgment under appeal acknowledged that the issue involved was covered in favor of the petitioner by the decision in Baiju A A v. State Tax Officer. The counsel for the appellants argued that the notices issued were within the period of limitation stipulated by the amended provision and before a right accrued in favor of the dealer. The counsel contended that if the notice was issued within the limitation period, it cannot be quashed by merely referring to the principles laid down in Baiju A A case. The court emphasized the importance of considering whether the notices were issued within the prescribed time frame. Issue 2: Interpretation of the amended provision under Section 25 of the KVAT Act The court analyzed the amended provision under Section 25 of the KVAT Act, which extended the period for determining assessments. The court scrutinized the timeline for issuing reassessment notices and the impact of the amended provision on the rights of the dealers. It was argued that the amendment made through the Finance Act was intended to be prospective and not retrospective, contrary to the argument presented by the respondents. Issue 3: Determination of the period of limitation for issuing reassessment notices The court examined specific cases where reassessment notices were served to dealers for different assessment years. The court assessed whether the notices were issued within the revised period of limitation as per the amended provision. The judgment emphasized the importance of adhering to the statutory timelines for issuing such notices and the implications of the amended legislation on the reassessment process. Issue 4: Whether the Amending Act is prospective or retrospective The court addressed the argument raised by the respondents regarding the prospective application of the Amending Act from 01.04.2017. The court disagreed with this argument, stating that it went against established principles of statutory construction. The judgment highlighted that the amendment extending the period of limitation to six years was applicable to the subject assessment years, and the respondents did not have a vested right or accrued interest against the reassessment procedure under Section 25. In conclusion, the court set aside the judgments under appeal and granted the dealers/respondents the liberty to file appeals before the Appellate Authority within a specified timeframe. The court excused any delay caused during the pendency of the appeal and directed that the appeals, if filed, should be heard on merits and disposed of in accordance with the law. The appeals were allowed in favor of the appellants.
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