2019 (9) TMI 517 - HC - VAT and Sales Tax

Revision of assessment - TNVAT Act - time limit prescribed u/s 27 of TNVAT Act - AO sought to revise the assessment in respect of the relevant assessment years 2008-09, 2009-10 2010-11, to which, the deemed assessment has already been taken place and completed on 30.06.2012 - HELD THAT - If the Assessing Officer intends to revise the assessment based on a reason that the turn over has escaped assessment or that the assessee has wrongly availed the Input Tax Credit, he ought to have proceeded within the time prescribed under the above said provision of law, namely section 27 of the Tamil Nadu VAT Act. In this case, admittedly notice of revision itself was issued on 03.09.2018, beyond the period of six years. Though the respondents sought to contend that the inspection was conducted on 23.07.2012 to 26.07.2012, on which date, the assessee had also paid the tax and therefore, the proceedings for revision of the assessment should deemed to have commenced from that date onwards, this Court is not in a position to accept the above contention, especially, when it is clearly contemplated under section 27(1)(a) of the TNVAT Act, 2006 that the Assessing Officer may at any time within a period of six years from the date of assessment determine to the best of its judgment, the turn over which has escaped assessment and assess the tax payable on such turnover after making such enquiry as it may consider necessary - If the notice of proposal itself is issued beyond the period of six years, certainly, consequential assessment orders, as has been issued in this case, are also barred by limitation and thus, the same cannot be sustained. The impugned orders of assessment are set aside solely on the ground that they are barred by limitation - Petition allowed.

Summary

Issues:
Challenge to order revising assessment for assessment years 2008-09, 2009-10 & 2010-11 beyond the statutory limitation period.

Analysis:
The petitioner, a registered dealer, challenged the revision of assessments for the mentioned years beyond the statutory limitation period. The original assessments were deemed completed on 30.06.2012, and any revision should have been within six years from that date. The notice of proposal for revision was issued on 03.09.2018, clearly exceeding the six-year limit. The respondent argued that payments made before Enforcement Wing Officials justified the revision orders, but the court emphasized the importance of the limitation period under Section 27 of the Tamil Nadu VAT Act.

The petitioner contended that the revision notice issued after six years rendered the assessment vitiated on limitation grounds. The court noted that the revision notice was indeed issued beyond the prescribed period. The government advocate admitted this fact. The court emphasized that the Assessing Officer should have initiated any revision within the statutory time frame. The court rejected the argument that an inspection date or tax payment could be considered as the start of the revision exercise, highlighting the importance of the notice of proposal as the starting point for the limitation period.

The court referred to a recent decision and analyzed the term "determine" as per Section 27(1)(a) of the TNVAT Act. It highlighted that the term implies a specific process of assessment and determination within the statutory period. The court emphasized that the date of the revisional notice is crucial for determining the limitation period. The court cited legal dictionaries and previous judgments to support its interpretation of the term "determine" in the context of fiscal laws.

Based on the factual and legal analysis, the court allowed the writ petitions, setting aside the impugned assessment orders due to being barred by limitation. The court concluded that the revision orders were determined after the expiration of the six-year period from the date of assessment, as required by Section 27(1)(a) of the TNVAT Act. The judgment highlighted the importance of adhering to statutory time limits in assessment revisions.