2009 (7) TMI 1186 - HC - VAT and Sales Tax

Summary

Issues involved: Validity of assessment and reassessment orders under the Andhra Pradesh Value Added Tax Act, 2005 and the Andhra Pradesh General Sales Tax Act, 1957.

Validity of Assessment Orders: The court noted that the assessing officer issued show-cause notices solely based on a notice from the Central Excise Department, without any adjudication under the Central Excise Act, 1944. The petitioner contended that without a conclusive finding under the Central Excise Act, the show-cause notice could not be the basis for action under the APVAT Act or the APGST Act. The court held that the authorities should have conducted an independent inquiry under the APVAT Act and the APGST Act instead of solely relying on the Central Excise Department's notice. Consequently, the assessment orders were quashed on this ground.

Validity of Reassessment Orders: Similar to the assessment orders, the reassessment orders were also found to be invalid as they were based solely on the show-cause notice from the Central Excise Department without any independent inquiry or adjudication under the Central Excise Act, 1944. The court emphasized that for levying tax under the APVAT Act or the APGST Act, an independent conclusion regarding the nature of transactions should have been reached. Since the orders were solely based on the Central Excise Department's notice, they were quashed.

Conclusion: The court allowed the writ petitions, quashed the impugned orders, and stated that the respondents could issue a fresh show-cause notice, provide the petitioner with an opportunity to be heard, and pass assessment or reassessment orders in accordance with the law. No costs were awarded in the circumstances.