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TMI Blog2021 (10) TMI 1418X X X X Extracts X X X X X X X X Extracts X X X X ..... 13, the petitioner already filed a return and in view of Section 22(2) of the TNVAT Act, the said return deemed to have been accepted. 4. While that being so, there was an inspection by the officers of the Enforcement Wing of the respondent Department on 28.04.2015. During the inspection, the petitioner claimed to have produced all the documents and accounts right from 2010-2011 to 2014-2015 which were verified by the inspecting authorities. 5. However, thereafter, an order has been passed on 30.09.2016, under Section 22(4) of the TNVAT Act, where on satisfying with the documents produced by the petitioner/dealer, there has been a NIL balance of the tax payable by the petitioner and accordingly, the said order was passed on 30.09.2016. 6. However, now all of a sudden, the respondent has issued a show cause cum proposal for a revision of tax for the year 2012-2013 on 22.02.2021. Pursuant to the said notice and proposal dated 22.2.2021, the petitioner had given reply on 25.03.2021, where the petitioner had stated that the petitioner had closed the business on 01.06.2016 itself and the registration number under TNVAT Act itself was cancelled. Hence, the petitioner requested to drop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld contend that in this case, since it is assessment year 2012-2013, as per the deeming provision under Section 22(2) of the TNVAT Act, by 31st October 2013, the petitioner deemed to have been assessed. Therefore, the assessment was over insofar as the petitioner is concerned for the said assessment year. Hence, according to the petitioner's counsel, the limitation as prescribed under Section 27 (1) (a) of the TNVAT Act would commence from 1st November 2013. In that case, the six years limitation period would be over by 31st October 2019, whereas in the present case by invoking Section 27 of the TNVAT Act, the respondent issued notice on 22.02.2021. Therefore, it is certainly beyond the limitation of six years. Hence, on that ground alone the invocation of Section 27 of the TNVAT Act which culminated in the impugned order is vitiated. Therefore, the learned counsel appearing for the petitioner seeks indulgence of this Court against the impugned revised assessment. 13. Per contra, Mr.R.Sureshkumar, learned Government Advocate appearing for the respondent would contend that, under SubSection 4-A of Section 2 of the TNVAT Act, which has been amended or inserted subsequently, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive. The effect of reopening the assessment is to vacate or set aside the initial order for assessment and to substitute in its place the order made on reassessment. The initial order for reassessment cannot be said to survive, even partially, although the justification for reassessment arises because of turnover escaping assessment in a limited field or only with respect to a part of the matter covered by the initial assessment order. The result of reopening the assessment is that a fresh order for reassessment would have to be made including for those matters in respect of which there is no allegation of the turnover escaping assessment. As it is, we find that in the present case the assessment orders made under section 12-A were comprehensive orders and were not confined merely to matters which had escaped assessment earlier. In the circumstances, the only orders which could be the subjectmatter of revision by the appellant were the orders made under section 12-A of the Act and not the initial assessment orders. 8.In the case of J. Jagannathan Rao Vs. CIT and Excess Profits Tax, Andhra Pradesh this Court dealt with section 34 of the Indian Income- tax Act, 1922 which relates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r had been rectified and it was sought to make a further rectification of that order, the period of limitation for making such further rectification would commence not from the date of the original assessment order but from the date of the earlier rectification order. Alagiriswami, J. speaking for the Court in this context observed: "The other attack that the rectification order is beyond the point of time provided in Rule 38 of the Mysore Sales Tax Rules is also without substance. What was sought to be rectified was the assessment order rectified as a consequence of this Court's decision in Yaddalam's case. After such rectification the original assessment order was no longer in force and that was not the order sought to be rectified. It is admitted that all the rectification orders would be within time calculated from the original rectification order. Rule 38 itself speaks of 'any order' and there is no doubt that the rectified order is also 'any order' which can be rectified under Rule 38." Although the above case related to an order which had been subsequently rectified, the principle laid down therein would, in our opinion, be also applicable in ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we develops the said argument made by the learned Counsel appearing for the petitioner, this Court, on having a close reading of the provisions, namely, Section 22 (2) and 22(4), is of the view that, after the amendment, Section 22(2) reads thus: "The assessing authority shall accept the returns submitted for the year, by the dealer, if the returns are in the prescribed form and accompanied with the prescribed documents and proof of payment of tax. Every such dealer shall be deemed to have been assessed for the year on the 31st day of October of the succeeding year.." 22. While making amendment of Sub- Section 2 of Section 22 of the TNVAT Act, the following reasons have been given by the Legislature as Statement of Objects and Reasons, where it has been stated that, in the Value Added Tax Acts of many other States, such a requirement of passing an assessment order is not found, and instead, deemed assessment on filing of returns by the dealers is being followed, so that, at any time, within the period of limitation, without loss of time, the escaped revenue is assessed by way of revision. It is further stated in the Statement of Objects and Reasons by the Legislature that, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the TNVAT Act, the assessing authority cannot reopen it saying that the dealer to the best of its judgment can be once again assessed. 28. Moreover, insofar as Section 27 (1) (a) is concerned, the reasons for revising assessment is something different than of the reassessment as contemplated under Section 22(4) of the TNVAT Act. 29. In Section 27 (1) (a) if the dealer has escaped assessment to tax, the Assessing Authority may at any time within a period of six years from the date of assessment determine to the best of its judgment the turnover which has escaped assessment and assess the tax payable on such turnover after making such enquiry. In such circumstances, Section 27 of the revised assessment is a different proceedings than the one of section 22(4) of the TNVAT Act. Section 22(4) proceedings if at all to be made, it can be made only within the limitation i.e., within the period before the deeming clause come into effect i.e., on or before 31st day of October of the succeeding year. Otherwise, if we construed this provision in different manner to state that after the 31st day of October of the succeeding year, once the deeming assessment is made, then it is open to the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n made by the learned Government Advocate appearing for the respondent/revenue by citing the afore cited two decisions of the Hon'ble Supreme Court, this Court feels that, the two decisions may not apply to the present facts of the case for the reason that (1977) 1 SCC 703 (cited supra) decision arising out of the Mysore Sales Tax Act, 1957 and (1987) 1 SCC 684 (cited supra) decision arose out of U.P.Sales Tax Act, 1948. 35. In these two cases, such kind of deeming provisions as that of under Section 22 (2) of the TNVAT Act either was not available or has not been dealt with. 36. No doubt, if there is no deeming provision as available under Section 22(2) of the TNVAT Act which we have discussed herein above, certainly what was the last assessment made by the revenue would be taken into account for the purpose of calculating the limitation for invoking the revised assessment under Section 27 of the TNVAT Act. 37. This position would have been possible prior to the amendment made in the year 2012 under which the deeming provision has been inserted in Sub-Section 2 of Section 22 of the TNVAT Act. 38. Once a deeming provision comes into effect, for every assessment year, 31st O ..... X X X X Extracts X X X X X X X X Extracts X X X X
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