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2024 (4) TMI 426 - HC - VAT and Sales TaxValidity of reassessment proceedings - Extension of period of limitation and the consequential notice dated 29.11.2022 issued by respondent no.3 to reassess the petitioner for assessment year 2012-13 (UP) - HELD THAT - The Supreme Court in M/s Modi Naturals Ltd. Vs. The Commissioner of Commercial Tax, UP 2023 (11) TMI 298 - SUPREME COURT has opined that notwithstanding the non-vatable/exempt nature of DORB, its sale value would have to be considered/included for the purpose of carving out exclusion under Section 13(1)(f) of the UP VAT Act. On that reasoning, the judgment of the learned Single Judge has been reversed. In view of the above law declared by the Supreme Court, the material on the strength of which reassessment proceedings were drawn against the petitioner for A.Y. 2012-13 (UP) does not exist. In face of the law declared by the Supreme Court, it can never be said by the revenue, turn over had escaped assessment at the hands of the petitioner for the said assessment year. The reassessment proceedings for the reassessment year 2012-13 (UP) are quashed - the writ petition is allowed.
Issues involved:
The issues involved in the judgment are quashing the order passed by respondent u/s 29(7) of the Act and reassessment for assessment year 2012-13 (UP) based on the exclusion under Section 13(1)(f) of the UP VAT Act. Quashing of Order u/s 29(7) of the Act: The present writ petition sought to quash the order dated 18.3.2020 passed by the respondent no.2 u/s 29(7) of the Act, extending the period of limitation and the consequential notice dated 29.11.2022 issued by respondent no.3 to reassess the petitioner for assessment year 2012-13 (UP). The petitioner, a manufacturer of Rice Bran Oil (RBO), purchased Rice Bran and manufactured RBO and De-Oiled Rice Bran (DORB) as a by-product. The petitioner made sales of both RBO and DORB, with the total sale price exceeding the cost price for the purchase of raw material used. In the original assessment proceedings, the benefit of Input Tax Credit (ITC) was granted to the petitioner, adjusting ITC paid on the purchase of Rice Bran against outward tax payable on RBO. Exclusion under Section 13(1)(f) of the UP VAT Act: A learned Single Judge of the Court previously held in Commissioner of Commercial Tax Vs. Modi Natural Ltd. that the sale value of DORB, though non-vatable/exempt, should be considered for the exclusion under Section 13(1)(f) of the UP VAT Act. This decision was appealed to the Supreme Court, which reversed the judgment, stating that the sale value of DORB must be included for the exclusion under Section 13(1)(f) of the Act. Consequently, based on the law declared by the Supreme Court, the reassessment proceedings against the petitioner for the assessment year 2012-13 (UP) were deemed invalid, and the writ petition was allowed, quashing the reassessment proceedings.
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