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TMI Blog2021 (7) TMI 638X X X X Extracts X X X X X X X X Extracts X X X X ..... ovides that such assessment shall be made within a period of 4 years from the end of the period for which the assessment is made. Sub-section (5) thereof enlarges the period of limitation to 6 years for making such assessment to 6 years from the date of filing of the return in the event there is wilful evasion of tax - Hence, a finding there is wilful evasion of tax is a condition precedent to invoke powers under Section 21(5) of VAT Act. In the present case, the assessing authority initially proceeded to issue show-cause notice upon the petitioner for payment of tax at the rate of 1% on the hire charges for the assessment year 2014-15. Subsequently, a revised show-cause notice calling upon the petitioner-assesse to pay tax at the rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OF 2021 - - - Dated:- 30-6-2021 - HON'BLE SRI JUSTICE JOYMALYA BAGCHI AND HON'BLE SRI JUSTICE K.SURESH REDDY Counsel for the Petitioner : Smt. T.V. Sridevi Counsel for Respondents : Sri C. Sekhar (Government Pleader for ORDER: (Per Hon ble Sri Justice Joymalya Bagchi) 1. Order, dated 16.11.2020, passed by respondent No.3 in AO No.ZH3711200D26989, imposing tax liability to the tune of ₹ 3,06,130/- for the assessment year 2014-15 and the consequential penalty and urgent notices dated 16.11.2020 and 16.03.2021 respectively have been challenged by the petitioner-assessee. 2. Petitioner is a private bus operator and is assessed under the jurisdiction of respondent No.3/Commercial Tax Officer. On the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had let out the said vehicles for the assessment period 2014-15. With regard to the rate of tax leviable on the petitioner, the assessing authority, after referring to Section 4(8B) of the VAT Act read with Rule 17A came to a finding that the petitioner was not entitled to the lower rate of tax as he had not complied with the aforesaid provisions. Accordingly, the tax liability to the tune of ₹ 3,06,130/- was assessed on the petitioner for the assessment year 2014-15. 3. Mrs.T.V.Sri Devi, learned counsel for the petitioner, assailing the aforesaid order submits that the initial show-cause notice had been issued to levy tax at the rate of 1% on the hire charges upon the petitioner. After expiry of the limitation period, the assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d why tax at the rate of 1% on the hire charges be not imposed. Subsequently, by invoking Section 21(5) of the VAT Act a revised show-cause notice levying tax at a higher rate i.e., 14.5% was proposed. 6. Section 21 of the VAT Act provides for the procedure for assessment of tax in respect of a VAT or TOT dealer, who fails to file return within the prescribed time. Sub-section (4) of Section 21 inter-alia provides that such assessment shall be made within a period of 4 years from the end of the period for which the assessment is made. Sub-section (5) thereof enlarges the period of limitation to 6 years for making such assessment to 6 years from the date of filing of the return in the event there is wilful evasion of tax. 7. Section 21 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of alternative remedy. 10. We have gone through the length and breadth of the revised show-cause notice served on the petitioner, dated 31.08.2020, wherein it is averred that the rate of tax was incorrectly fixed at 1% and accordingly the revised proposal to impose tax at 14.5% was made. There is no averment in the revised show-cause notice that there was wilful evasion on the part of the assessee to pay the higher rate of tax. Incorrect application of a lower rate of tax per se would not amount to a wilful evasion of tax unless and until factual averments disclosing wilful evasion of tax are made out in the show-cause notice. Moreover, impugned order is also completely silent on this score. There is no finding that the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X
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