2021 (8) TMI 590 - HC - VAT and Sales Tax

Validity of assessment order - it is alleged that the assessment orders passed by the respondent were without jurisdiction - Proviso to Section 22(2) of the TNVAT Act - HELD THAT - Section 27 of the TNVAT Act deals with assessment of escaped turnover and wrong availment of input tax credit. Sub-Section (2) of Section 27 of the TNVAT Act states that where, for any reason, the input tax credit has been availed wrongly or where any dealer produces false bills, vouchers, declaration certificate or any other documents with a view to support his claim of input tax credit or refund, the Assessing Authority shall, at any time, within a period of five years from the date of order of assessment, reverse input tax credit availed and determine the tax due after making such an enquiry, as it may consider necessary. The General Sales Tax Law of the State of Tamil Nadu in the instant case is the TNVAT Act and therefore, the provisions of the TNVAT Act and the Rules framed thereunder would fully apply and govern the assessment proceedings under the CST Act. Appeal allowed.

Summary

Issues:
Challenging assessment orders under CST Act and TNVAT Act, jurisdiction of assessing officer, treatment of impugned assessment orders as notices under TNVAT Act, limitation under Section 27 of TNVAT Act, production of documents to establish fire accident, competence of Assessing Officer under CST Act.

Analysis:

Challenging Assessment Orders:
The appellant, a registered dealer under CST Act and TNVAT Act, challenged assessment orders for 2008-09 and 2009-10. The Single Judge held assessments were without jurisdiction due to the fiction in Section 22(2) of TNVAT Act, deeming assessment as on 30.6.2012, rendering respondent's orders jurisdictionally flawed.

Treatment of Assessment Orders:
The Single Judge quashed the impugned orders but directed them to be treated as notices under Section 27 of TNVAT Act. However, the Assessing Officer can only issue a notice under Section 27 for revision of assessment within a five-year period, making the direction time-barred as assessments were deemed completed by 30.6.2012.

Jurisdiction of Assessing Officer:
The Assessing Officer's competence under CST Act empowers them to assess, re-assess, and enforce payment of tax as per the State's general sales tax law, which in this case is TNVAT Act. The provisions of TNVAT Act and its rules govern assessment proceedings under CST Act.

Production of Documents:
The appellant produced an FIR to establish a fire accident in their godown, contrary to the Single Judge's observation. The appellant clarified that only one godown was affected by the fire, not multiple as indicated by the Judge.

Competence of Assessing Officer:
The Government Advocate argued that the Assessing Officer was authorized to issue notices under Section 22(2) of TNVAT Act for the relevant assessments under CST Act, and the Single Judge's direction to treat assessment orders as Section 27 notices was justified.

Conclusion:
The writ appeals were allowed, setting aside the Single Judge's orders. The impugned directions were deemed unsustainable, and the writ petitions were allowed as prayed for, with no costs. The connected CMPs were closed, concluding the matter before the High Court.