2020 (12) TMI 948 - HC - VAT and Sales Tax

Rectification of mistake - assessing authority passed deemed assessment order under Section 12C(8) of the Act in terms of Notification No.FD 116 CSL 2006(3) dated 31.03.2006 without considering the revised return filed by the petitioner which was filed before the deemed acceptance of the annual returns - HELD THAT - Admittedly, in the case of the petitioner, the orders have been passed under Section 12C(8) of the Act. Section 12-C(2) of the Act provides that where before completion of self assessment, returns submitted or any compliance furnished under sub Section (1) is found to involve mistake apparent on record, the assessing authority shall afford an opportunity to the dealer to submit revised return or to rectify such mistake. Thus, it is evident that the provision for filing the revised return was in existence in the statute. It is trite law that once a revised return is filed, the original return must be taken to have been withdrawn and to have been substituted by a fresh return for the purposes of assessment. Section 25-A of the Act deals with rectification of the mistake - Admittedly, in the instant case, it is not in dispute that the assessing authority passed an order taking into account the original return instead of revised return on 31.05.2006, 28.08.2006 and 31.08.2006. The petitioner had filed the revised returns in Form No.4 on 12.04.2006, 19.08.2006 and 30.05.2006. Therefore, in view of second proviso to Section 25A of the Act, on expiry of sixty days, the revised return should have been deemed to have been accepted. However, after a period of sixty days, the adjudicating authority passed an order on 31.10.2007, 21.01.2008, and 05.01.2008, which were per se without jurisdiction. The aforesaid aspect of the matter was neither considered by first appellate authority nor by the tribunal. The tribunal has decided the question of law erroneously, which arose for its consideration. The orders of rectification dated 31.10.2007, 21.01.2008 and 05.01.2008 passed by the adjudicating authority, orders dated 09.07.2008, 10.07.2008 and 11.07.2008 passed by the first appellate authority and order dated 17.07.2013 passed by the tribunal are hereby quashed - Revision allowed.

Summary

Issues:
1. Jurisdiction of assessing authority in passing deemed assessment order without considering revised returns.
2. Rejection of rectification applications by assessing authority.
3. Appeal before first appellate authority and subsequent dismissal by tribunal.
4. Interpretation of Section 25A of the Act regarding deemed acceptance of rectification applications.

Analysis:

Issue 1:
The revision petitions challenged the deemed assessment order passed by the assessing authority without considering the revised returns filed by the petitioner. The petitioner argued that the assessing authority erred in not accepting the revised returns before passing the deemed assessment order. The court noted that the provision for filing revised returns existed in the statute, and once a revised return is filed, the original return is deemed withdrawn. The court referred to Section 12C(2) of the Act, emphasizing the opportunity for rectification of mistakes in returns. The failure to consider the revised returns before passing the deemed assessment order was held to be erroneous.

Issue 2:
The assessing authority rejected the rectification applications filed by the petitioner beyond the stipulated 60-day period. The petitioner contended that as per Section 25A of the Act, if an application for rectification is not rejected within 60 days, it is deemed accepted. The court agreed with the petitioner, stating that the orders rejecting the rectification applications after the expiry of 60 days were without jurisdiction. The tribunal's failure to consider this aspect was highlighted as an error in deciding the matter.

Issue 3:
After the rejection of rectification applications, the petitioner appealed before the first appellate authority, which partly allowed the appeal on minor grounds but dismissed it on other grounds, including the deemed acceptance issue. Subsequently, the tribunal upheld the orders of the assessing authority and the first appellate authority. The court found that the tribunal had erroneously decided the legal question that arose for consideration, leading to the quashing of all previous orders.

Issue 4:
The interpretation of Section 25A of the Act regarding the deemed acceptance of rectification applications was crucial in this case. The court emphasized that in this instance, the revised returns should have been deemed accepted after the expiry of 60 days from filing. The failure of the adjudicating authority to do so rendered subsequent orders without jurisdiction. The court's decision to quash all previous orders was based on this interpretation of the statutory provision.

In conclusion, the court allowed the revisions, quashed all previous orders, and emphasized the importance of adhering to statutory provisions regarding the acceptance of revised returns and rectification applications within the prescribed timelines.