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2020 (5) TMI 586 - HC - VAT and Sales TaxDeemed assessment order - challenge on the ground that there is no valid reason for the respondent to call for such records in the light of Pondicherry General Sales Tax (Assessment) Rules, 2007 which was implemented on the eve of Pondicherry VAT Act, 2007 w.e.f. 01.12.2007 - HELD THAT The assessment order in question pertains to 2001 to 2002 for which the petitioner has also filed returns. Since PGST Act, 1967 was being replaced with Puducherry VAT Act, 2007, the Government of Puducherry issued the above Rules. The purpose of the aforesaid Rule was to bring finality to the assessment proceedings which had remained incomplete as on 01.05.2007. The respondents ought to have passed a deemed assessment order and thereafter, initiated fresh proceedings under the provisions of the newly inserted Pondicherry VAT Act, 2007 read with Pondicherry General Sales Tax (Assessment) Rules, 2007. Instead, they delayed in passing deemed assessment order in terms of the aforesaid Rules - there are no merits in the impugned order. The impugned notice is quashed and the respondent is directed to pass appropriate assessment orders in terms of the Pondicherry General Sales Tax (Assessment) Rules, 2007 - Petition allowed - decided in favor of petitioner.
Issues:
Challenge to impugned notice dated 25.08.2016 for calling records related to assessment of the year 2001-2002 under PGST Act, 1967 and CST Act, 1956. Analysis: 1. The petitioner contested the impugned notice arguing that there was no valid reason for the respondent to request records considering the Pondicherry General Sales Tax (Assessment) Rules, 2007, implemented on the eve of the Pondicherry VAT Act, 2007. 2. The petitioner's counsel emphasized that the respondent should pass a deemed assessment order as per Rule 3 for pending assessments up to 2006-2007 under PGST Act, 1967 and CST Act, 1956. Reference was made to a similar case involving ELGI Electric & Industries where a deemed assessment order was issued. 3. The assessment order for ELGI Electric & Industries showed acceptance of the return filed by the dealer under the PGST Act, 1967, resulting in deemed-assessment under the Pondicherry General Sales Tax (Assessment) Rules, 2007, with specific turnover details and tax dues. 4. The petitioner's counsel argued that the notice dated 25.08.2016 was belated and contrary to Rules 2 and 3, while the respondent defended the notice citing previous requests for records since December 2007 and the petitioner's delays in compliance. 5. The court noted that the assessment order in question related to 2001-2002, and the delay in passing a deemed assessment order under the new rules after the transition to the Pondicherry VAT Act, 2007, was unjustified, leading to the quashing of the impugned notice. 6. Consequently, the court directed the respondent to issue appropriate assessment orders as per the Pondicherry General Sales Tax (Assessment) Rules, 2007, while allowing the respondent the liberty to initiate further proceedings as per the law. 7. The writ petition was allowed with the above observations, with no costs imposed, and the connected Miscellaneous Petition was closed.
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