2016 (12) TMI 817 - HC - VAT and Sales Tax

Validity of Assessment order - non production of Form C - non-production of Form H Declarations - reversal of ITC u/s.19 5 c of TNVAT Act - Held that - In terms of the circular 23367/93 dated 30.04.1993, no strict guidelines have been fixed for production of such declaration forms and the object of production of these forms is to enable the dealer to avail concessional rate of tax. Therefore, a rigid and strict interpretation cannot be done in this regard and the Assessing Officer would be justified in accepting the forms even after the assessment is completed - this Court is of the view that the assessment can be re-done afresh after receiving Forms C and H declarations, which the petitioner is in position as on date. With regard to the proposal u/s.19 2 v is concerned, since the petitioner is yet to challenge statutory provision before this Court, the court has given liberty to raise objections on the said issue. Petition allowed - matter on remand - petitioner is granted four weeks time to produce Forms C and H Declarations and also submit further objections to the proposals to reverse ITC u/s.19 5 c and on receipt of the same, the respondent shall re-do the assessment in accordance with law.

Summary

Issues:
Challenge to Assessment Order dated 25.11.2016 for Assessment Year 2013-2014 based on non-production of Form C and Form H Declarations and reversal of ITC u/s.19[5][c] of TNVAT Act.

Analysis:

1. The petitioner, a registered dealer under TNVAT Act and Central Sales Tax Act, challenged the Assessment Order dated 25.11.2016 for the Assessment Year 2013-2014. The grounds for challenge included non-production of Form C and Form H Declarations and the proposed reversal of Input Tax Credit (ITC) u/s.19[5][c] of TNVAT Act. The petitioner responded to the notice by stating they were in the process of collecting the forms and intended to appeal the ITC reversal proposal. Despite this, the assessment was finalized solely based on the petitioner's initial response. The petitioner had not challenged the validity of section 19[2][v] before the Court and had since collected additional Forms C and H declarations for submission.

2. The Commissioner of Commercial Taxes issued a Circular directing Assessing Officers on handling belated submission of declaration forms. The Circular emphasized a liberal approach in reassessing cases where additional forms were produced, citing a previous court decision. It highlighted that no strict guidelines were set for form production, aiming to facilitate dealers in availing concessional tax rates. The Court endorsed this approach, emphasizing the importance of enabling dealers to benefit from concessional rates and rejecting rigid interpretations regarding form submission timelines.

3. The Court concluded that a fresh assessment could be conducted upon receipt of Forms C and H declarations, which the petitioner possessed at the time. Since the petitioner had not challenged the statutory provision u/s.19[2][v] before the Court, they were granted liberty to raise objections on this issue. As a result, the writ petition was allowed, the impugned order was set aside, and the matter was remanded for fresh consideration. The petitioner was given four weeks to produce the required forms and submit objections, after which the respondent would re-do the assessment in compliance with the law. No costs were awarded, and the connected miscellaneous petition was closed.