2025 (3) TMI 673 - HC - VAT / Sales Tax

Reopening of assessment beyond a period of three years from the date of the judgment or order - applicability of time limitation - suppression of facts - HELD THAT - It is apparent from the narration of facts recorded in the foregoing paragraphs that the writ petitioner approached this Court without making any mention or reference of the suo-moto revisional proceedings by raising a plea of time bar under Section 36 (1) of the TVAT Act 2004 for reopening of assessment vide notice dated 18th October 2024. This Court being persuaded by the legal plea also passed an interim order staying further proceedings pursuant to the impugned show-cause notice. The petitioner did not even care to challenge the order of the revisional authority dated 27th October 2022 though it was specifically mentioned in the impugned notice dated 18th October 2024. Therefore petitioner has not come with clean hands before this Court. The writ petition is therefore fit to be dismissed only on the basis of the principles suppressio veri; suggestio falsi. The proceedings under writ jurisdiction of such nature cannot be entertained at the behest of a party who has indulged in suppression of fact. Reliance is placed on the opinion of the Apex Court in K Jayaram and Others Vs. Bangalore Development Authority and Ors. 2021 (12) TMI 1439 - SUPREME COURT paragraphs 10 11 13 14 which are quoted hereunder. The Hon ble Supreme Court has categorically held that the petitioner approaching the writ court must come with clean hands and put forward all facts before the court without concealing or suppressing anything while invoking the extraordinary equitable and discretionary remedy of the High Court under Article 226 of the Constitution. Conclusion - A petitioner seeking relief under Article 226 must disclose all material facts and come with clean hands. Suppression of material facts is a ground for dismissal of a writ petition. The writ petition is dismissed on the ground of suppressio veri; suggestio falsi as the petitioner had not disclosed the revisional proceedings and the order directing reassessment. The writ petition is accordingly dismissed.

Summary

ISSUES PRESENTED and CONSIDERED

The primary legal issue considered in this judgment was whether the reopening of assessment beyond a period of three years from the date of the original assessment order is permissible under the Tripura Value Added Tax Act, 2004 (TVAT Act, 2004). Specifically, the petitioner challenged the notice dated 18th October, 2024, issued under Section 36(1) of the TVAT Act, arguing that it was time-barred. Additionally, the issue of whether the petitioner suppressed material facts in the writ petition was also considered.

ISSUE-WISE DETAILED ANALYSIS

Reopening of Assessment Beyond Three Years

- Relevant Legal Framework and Precedents: The petitioner relied on Section 36(1) of the TVAT Act, which prescribes a limitation period for reopening assessments. The petitioner argued that the notice for reassessment was issued beyond the permissible period of three years from the date of the original assessment order, which was completed on 12th December, 2014.

- Court's Interpretation and Reasoning: The Court noted that the petitioner had failed to disclose the fact of revisional proceedings initiated by the Commissioner of Taxes under Section 70(1) of the TVAT Act, which directed a reassessment. The Revisional Authority had disposed of the revision case on 27th October, 2022, directing the Superintendent of Taxes to reassess the dealer afresh.

- Key Evidence and Findings: The Court found that the petitioner had participated in the revisional proceedings and had been served with notices regarding the reassessment. The Revisional Authority's order was not challenged by the petitioner, and the notice dated 18th October, 2024, was issued in accordance with the directions of the Revisional Authority.

- Application of Law to Facts: The Court applied the principle that a party seeking relief under Article 226 of the Constitution must come with clean hands and disclose all relevant facts. The petitioner's failure to mention the revisional proceedings and the order dated 27th October, 2022, constituted suppression of material facts.

- Treatment of Competing Arguments: The State argued that the reassessment proceedings were based on an audit report and were not illegal. The Court agreed with the State's contention, emphasizing the petitioner's failure to disclose the revisional proceedings.

- Conclusions: The Court concluded that the writ petition was not maintainable due to the petitioner's suppression of material facts. The petitioner had not come with clean hands, and the writ petition was dismissed on this basis.

Suppression of Material Facts

- Relevant Legal Framework and Precedents: The Court relied on precedents from the Supreme Court, particularly K Jayaram and Others Vs. Bangalore Development Authority and Ors., which emphasized the necessity for a petitioner to disclose all material facts when seeking relief under Article 226.

- Court's Interpretation and Reasoning: The Court reiterated the principle that suppression of material facts or misleading the court is a ground for dismissal of a writ petition. The petitioner's failure to disclose the revisional proceedings amounted to suppression of facts.

- Key Evidence and Findings: The Court found that the petitioner had participated in the revisional proceedings and had been aware of the order directing reassessment. The petitioner's omission of these facts in the writ petition was significant.

- Application of Law to Facts: The Court applied the principle that a party must disclose all relevant facts when invoking the jurisdiction of the court. The petitioner's conduct in suppressing facts warranted dismissal of the writ petition.

- Treatment of Competing Arguments: The State argued that the petitioner had suppressed material facts, and the Court agreed, finding that the petitioner had not come with clean hands.

- Conclusions: The Court concluded that the petitioner's suppression of facts was a sufficient ground for dismissal of the writ petition. The writ petition was dismissed, and the interim order was vacated.

SIGNIFICANT HOLDINGS

- The Court held that a petitioner seeking relief under Article 226 must disclose all material facts and come with clean hands. Suppression of material facts is a ground for dismissal of a writ petition.

- The Court emphasized that the jurisdiction exercised under Article 226 is extraordinary, equitable, and discretionary, and a petitioner must candidly disclose all relevant facts.

- The Court dismissed the writ petition on the ground of suppressio veri; suggestio falsi, as the petitioner had not disclosed the revisional proceedings and the order directing reassessment.

- The Court vacated the interim order dated 28th November, 2024, and dismissed the writ petition due to the petitioner's failure to disclose material facts.