2023 (5) TMI 1147 - HC - VAT and Sales Tax

Review of Order after gap of 13 years - delay can be condoned or not - right for cross-examination to the third party in reassessment proceedings - Seeking Refund alongwith Interest - HELD THAT - In the facts of the present case, initial assessment order was passed wayback on 09.01.2001 (Annexure P-1). Thereafter, reassessment order was passed on 12.06.2002 (Annexure P-2) and a demand for Rs. 18,20,000/- was raised. Thereafter, appeal filed by the assessee before the Joint Excise and Taxation Commissioner (A), Hisar was dismissed vide order dated 19.12.2002 (Annexure P-3). However, the demand was reduced to Rs. 17,06,322/-. The said order was challenged by the petitioner whereby the Tribunal disposed of the appeal on 03.10.2012 (Annexure P-4) by observing that the assessee had a right for cross-examination to the third party in reassessment proceedings. However, the Tribunal did not remand back the matter to the Assessing Authority for reassessment vide order dated 03.10.2012 (Annexure P-4). For all intents and purposes, orders from 09.01.2001 (Annexure P-1) till the order dated 19.12.2002 (Annexure P-3) passed by Joint Excise and Taxation Commissioner (A), Hissar have attained finality. Even if the Department has filed application for modification of the order of the Tribunal dated 03.10.2012 (Annexure P-4) as reflected in the affidavit filed by the Excise and Taxation Commissioner dated 18.03.2020, the time taken from 03.10.2012 till 09.01.2020 (date of filing application) i.e. 8 years cannot be condoned as per Section 35 of the Act, 2003. There is a period of one year provided as per the Act, 2003 for seeking review of any order passed by the Tribunal. Hence, the time for getting the reassessment order reviewed has already elapsed and the reassessment order has already attained finality. The order of the Tribunal dated 03.10.2012 (Annexure P-4) cannot be reviewed after a gap of 8 years and as on today almost 13 years have gone by and even at this stage, application filed by the respondents for reviewing order dated 03.10.2012 (Annexure P-4) is still pending for adjudication - Moreover, Section 18 of HVAT Act is not attracted in the present case for deciding the remanded case in two years as the present case was not remanded back to the Assessing Authority. As per Section 35 of the Act, 2013, even review application is not maintainable and has to be dismissed on the ground of delay. The writ petition is allowed and direction is given to the respondents to refund an amount of Rs. 17,06,322/- pursuant to order dated 19.12.2002 (Annexure P-3) alongwith statutory interest as per law.

Summary

Issues involved:
The judgment involves issues related to reassessment proceedings under the Haryana General Sales Tax Act, 1973, cross-examination of third parties in assessment proceedings, refund of excess amount demanded, finality of orders passed by various authorities, and the applicability of statutory provisions for review and limitation periods.

Reassessment Proceedings:
The petitioner, engaged in manufacturing vegetable ghee, was subject to reassessment proceedings initiated by the Deputy Excise & Taxation Commissioner-cum-Assessing Authority, Hisar. The reassessment concluded that the petitioner had suppressed purchases, leading to an additional demand of Rs. 18,20,000. Subsequently, the Joint Excise & Taxation Commissioner upheld the findings but reduced the additional demand to Rs. 17,06,322, considering the varying tax rates applicable. The petitioner appealed to the Haryana Tax Tribunal, which ultimately ruled in favor of the petitioner, emphasizing the necessity of cross-examination of third parties in the assessment process.

Refund and Finality of Orders:
Following the Tribunal's decision, the State of Haryana filed an appeal before the High Court, which was dismissed on 05.12.2014. Despite the dismissal, the case was neither remanded nor restored to the Assessing Authority for a fresh order. The petitioner sought a refund of the excess amount based on the finality of the High Court's judgment. However, the respondents contended that the order passed by the Tribunal had not attained finality, citing provisions of the Haryana VAT Act, 2003 regarding refundable amounts post-court orders.

Review and Limitation Periods:
The respondents filed an application for review of the Tribunal's order dated 03.10.2012, seeking modification. The petitioner argued that since the order had not been modified within the prescribed one-year period, the Assessing Authority lacked jurisdiction to initiate reassessment proceedings. The respondents, on the other hand, highlighted the pending application for modifying the order and the need for remanding the case back for reassessment.

Court Decision:
The Court noted the finality of orders from initial assessment to the Tribunal's decision, emphasizing the statutory provisions for review within one year. The Court held that the reassessment order had attained finality, and the review application filed after 8 years was not maintainable. Referring to relevant sections of the Act, the Court allowed the writ petition, directing the respondents to refund the excess amount demanded along with statutory interest as per the law.