INITIATION OF SOU MOTO REVISION PROCEEDINGS., VAT + CST

[Sadanand Bulbule]

Dear Sirs

Here is an academic issue lingering in the minds of many including the revisional authorities under various Acts. The issue though looks very simple but it has very wide ramifications in terms of validity of SMR jurisdiction followed by its outcome.

ISSUE.

When does the initiation of sou moto revision begin? Whether from the date of calling for the records? Or from the moment the issue of notice proposing to revise some proceedings? In other words, when does the limitation to pass the sou moto revison order begin?

Of course, the whole matrix depends upon the specific language used in the respective Acts, for example, " shall pass order within one year from the initiation of proceeding or calling for the records". When looked carefully at the eventualities provided under the Act, one is curious to know multiples dimensions of eventualities and the Legislative intent behind such eventualities too.

In my limited understanding the eventualities may be, either the revisional authority on its own may call for the records for revision or the the lower authorities may also submit the records for revision, if the need be, for various reasons.

Importantly in the present prevailing situation, whether COVID-19 lockdown period needs to be excluded while computing the prescribed "one year" limitation period?

In this matter, the honourable experts are requested to throw fresh/more light on this subject with latest research articles/ judicial rulings in the larger interest of all the stake holders. My humble submission is, this is not a personal question for commercial purpose but only to demystify the issue for the benefit of all the subscribers of TMI.

With respects.

Posts / Replies

[YAGAY andSUN]

Karnataka extends Time Limit for Tax Proceedings amid COVID-19

The Government of Karnataka on 16.04.2020 issued four notifications pertaining to the removal of difficulties amid lockdown. The notification seeks to extend time limitation mostly by 6 months for assessments, reassessments, appeals, rectification, and revisions. Firstly, the government issued Karnataka Tax on Professions, Trades, Callings, and Employments (Removal of Difficulties) Order, 2020 and inserted “Provided also that for the month of March 2020, the statement shall be submitted on or before 20th day of May 2020” and “provided that for the financial year 2020-21, in respect of a person who stands enrolled before the commencement of the said year, the payment of the amount of tax due shall be paid before the 30th day of May 2020.” after Section 6-A (1) and Section 10 of the Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976 respectively. Secondly, the government issued the Karnataka Tax on Entry of Goods (Removal of Difficulties) Order, 2020 and clarified, “for the purpose of the “five years after the end of prescribed tax period” in of Section 7(1) of the Karnataka Tax on Entry of Goods Act, 1979, relating to tax periods up to March 2016, shall be considered to be “five years and six months after the end of prescribed tax period” and “the “eight years after the end of prescribed tax period” in subsection (2) of section 7 of the said Act relating to tax periods up to March 2016, shall be considered to be “eight years and six months after the end of prescribed tax period”. Thirdly, the Government of Karnataka being of the opinion that it is necessary in the public interest so to do hereby notifies as “The statement to be submitted by the registered dealers under sub-rule (1) of Rule 18 of the Karnataka Sales Tax Rules, 1957, for the month of March 2020 and April 2020 shall be submitted, along with due payment of taxes, within twenty days from the end of the tax period to which it relates by sending the copy of such statement duly signed, to the e-mail id [email protected] and such submission of the statement shall be considered as due submission of the returns for such tax period. The physical copy of the above statement shall be submitted to the assessing authority within sixty days from the end of the tax period to which it relates.” Lastly, the government issued Karnataka Value Added Tax (Removal of Difficulties) Order, 2020 clarified, “for the purpose of calculating, the “four years have expired after the passing of the order sought to be revised” in sub-section (2) of section 63A of the said Act, relating to tax periods up to March 2016, shall be considered to be “four years and six months have expired after the passing of the order sought to be revised”; the “one year from the date of initiation of proceeding or calling for the records” in sub-section (3) of section 63A of the said Act relating to tax periods up to March 2016, shall be considered to be “one year and six months from the date of initiation of proceeding or calling for the records”.

[KASTURI SETHI]

Sh.Sadanand Bulbule Ji,

Sir, Your questions are always thought provoking and require high level brainstorming. Anyhow I really relish your high standard of drafting though I am unable to answer inasmuch as VAT /CST is not my cup of tea.Driving on bumpy road is always adventurous.

[Sadanand Bulbule]

Respected Sethi Sirji,

The initial response itself is really soothing and has made me to stand on toes seeking for a brilliant explanation as usual. As rightly pointed out, the issue is much deeper than it looks from the surface.

I am of the opinion that, this forum is not for questions and quick answers. Since most of the subscribers are highly acclaimed tax consultants and senior tax officers too, right dissection of any issue is needed to pave the way to search for the expected results. The more one dives deeper, one would catch more pearls. Please take your own time Sir.

Warm respects.