2016 (6) TMI 1111 - HC - VAT and Sales Tax

Validity of assessment order and appellate orders for the period 01.04.2009 to 30.10.2013 - challenge to the orders on the ground of limitation, and for violation of principles of natural justice - According petitioner, since the period of limitation under Section 21(4) of the A.P.Value Added Tax Act, 2005 (for short the Act ) is four years from the end of the period for which assessment is to be made, the assessment order, for the period 01.04.2009 to 31.01.2010, is barred by limitation. Held that - The jurisdiction, which this Court exercises under Article 226 of the Constitution of India, is supervisory and not appellate. Under Article 226 of the Constitution of India, this Court would not re-appreciate the evidence on record, or record findings on facts. The orders of the Assessing and Appellate Authorities do not, therefore, necessitate interference, except to the limited extent that the assessment made for the period 01.04.2009 to 31.12.2009 is barred by limitation. To this limited extent, the assessment order is set aside. In all other respects, it is upheld. - Decided partly in favor of petitioner.

Issues:
1. Assessment order legality, arbitrariness, violation of natural justice, and contrary to Circular instructions.
2. Limitation period under Section 21(4) of A.P. Value Added Tax Act, 2005.
3. Definition of "tax period" under Section 2(36) of the Act.
4. Assessment procedure under Sections 21(3) and 20 of the Act, Rule 23(1) of A.P. Value Added Tax Rules, 2005.
5. Violation of principles of natural justice.
6. Reasonable opportunity for objections as per Circular instructions.
7. Merits of the case and lack of documentary evidence.
8. Jurisdiction of the High Court under Article 226 of the Constitution of India.

Analysis:

1. The writ petition challenges the assessment order dated 17.02.2014 by the Commercial Tax Officer, Vijayawada, affirmed by the appellate authority on 30.08.2014, alleging illegality, arbitrariness, violation of natural justice, and non-compliance with Circular instructions. The petitioner argued for setting aside the orders on grounds of limitation and violation of principles of natural justice.

2. The petitioner contended that the assessment order for the period 01.04.2009 to 31.01.2010 was time-barred under Section 21(4) of the Act, as the representation was submitted on 13.02.2014. The Court held that the assessment for this period was indeed barred by limitation, as per the statutory provisions.

3. The Act defines "tax period" as a calendar month unless otherwise prescribed. Since no other period was prescribed, the tax period remained a calendar month, impacting the assessment timeline.

4. The assessment procedure under Sections 21(3) and 20, along with Rule 23(1) of the Rules, mandates timely filing of returns by VAT dealers. The Court found the assessment for the period 01.04.2009 to 31.12.2009 barred by limitation due to non-compliance with the prescribed timelines.

5. The petitioner alleged a violation of natural justice, claiming insufficient time to respond to the show cause notice. However, the Court found no evidence supporting the petitioner's claim of timely submission of objections, upholding the assessment order.

6. The Circular instructions required providing a reasonable opportunity for objections. The Court noted that the petitioner had the chance to seek further time before the assessment order was passed, indicating no violation of natural justice by the tax authorities.

7. On the merits, the petitioner failed to provide documentary evidence supporting their claims, leading to dismissal of the appeal by the Appellate Authority. The High Court emphasized that it does not re-appreciate evidence but only interferes to the extent of legal errors.

8. The High Court's jurisdiction under Article 226 is supervisory, not appellate. The assessment for the period 01.04.2009 to 31.12.2009 was set aside due to limitation, while the rest of the assessment was upheld, and the petition was disposed of accordingly.

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