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TMI Blog2024 (5) TMI 615X X X X Extracts X X X X X X X X Extracts X X X X ..... is 30.09.2016, and the authorization notice dated 27.02.2017, under Section 29 (4) of the Act, was issued beyond the period of limitation. The second notice was sent on 29.11.2016, and limitation had expired on 30.09.2016. Extended period of Limitation - HELD THAT:- For seeking the benefit of enlarged period of limitation, under Section 29 (4) of the Act, reasons in writing have to be given. Moreover, there is no suppression of facts, or evidence by the respondent, with the intention to evade the payment of VAT. There is no reason given in the authorisation order and the impugned order, justifying the applicability of Section 29 (4) of the Act, where the time period of assessment, under the regular Section 29(3), had already expired. In the present case, the Assessment Year is 2010-11, and before the end of six years, the reassessment order can be passed. The reassessment order has been passed on 25.03.2017, which is before the end of six years of the Assessment Year 2010-11, and hence the reassessment order passed under Section 29 (4) of the Act was done within limitation, and this aspect has been affirmed by the Tribunal, and the Appeals, qua this ground, has been rightly dismiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Added Tax Act, on the self-manufacture of Nylon Chips, the Assessing Officer, in the absence of Form-C and F Central sale on Nylon Chips was exigible to tax @ 14,83,879/- and 3,90,850/- and taxable @ 13.5% which amounted to Rs. 2,00,324/- and tax liability of Rs. 52,765/- was affixed. Against the said order, the Assessee filed an Appeal before the First Appellate Authority. The First Appellate Authority dismissed the Appeal, by observing that the trader had used the processing chemicals and compounds on raw materials plastic granules, and the product was being sold under a new name/ commodity called Nylon Chips, and there was no Entry with regard to notified Schedule-II of the Uttarakhand Value Added Tax Act, and the Assessing Officer had rightly considered that Nylon Chips cannot be considered as plastic granules, and they are not covered by Schedule-II of the Uttarakhand Value Added Tax Act, and hence the tax liability fixed on the sale of self-manufactured Nylon Chips, as 13.5%, was rightly done under Section 29 (1) (c) of the Act, which allows for re-assessment in case of incorrect rate of tax being applied in the previous assessment. 4. The question before the Tribunal was, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usiness, wherein it manufactures compounded polymers, i.e. Compounded Poly Carbonate ( PC ), and Compounded Poly Butylene Terephthalate ( PBT ). The raw material used by the respondent for the manufacture of the above goods is imported. 9. It is the further case of the respondent that during the process of manufacturing, undertaken by the respondent, fillers, such as glass fibre, minerals etc. and additives such as lubricants, antioxidant, colour master batches etc. is added to the molten polymer in an extruder. The compounded form of polymer comes out of the extruder in the form of strands, which is cut into small pieces with the help of a granulator. These small pieces are then packed and sold to the customers. The process of manufacture explained in the technical books, pertaining to manufacture of plastic, is the same, as is adopted by the respondent for manufacture of Polymer/ Nylon Chips. Hence, the Polymer/ Nylon Chips manufactured by the respondent are nothing, but plastic granules . The respondent has referred to the Central Institute of Plastics Engineering Technology (CIPET), which has issued a certificate, clearly stating that the products manufactured by the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Tax Act, Section 29 (4) deals with the procedure for doing reassessment, which reads as under : 29. Assessment of Escaped Turnover : (1) ... (2) ... (3) ... (4) If the commissioner on his own or on the basis of reasons recorded by the assessing authority is satisfied that it is just and expedient so to do, he may authorise the assessing authority in that behalf, and then such assessment or reassessment may be made after the expiration of the period aforesaid but not after the expiration of six years form the end of such assessment year, notwithstanding that such assessment or reassessment may involve a change of opinion. 14. In the present case, the Assessment Year is 2010-11, and before the end of six years, the reassessment order can be passed. The reassessment order has been passed on 25.03.2017, which is before the end of six years of the Assessment Year 2010-11, and hence the reassessment order passed under Section 29 (4) of the Act was done within limitation, and this aspect has been affirmed by the Tribunal, and the Appeals, qua this ground, has been rightly dismissed. 15. With respect to the second ground, whether Nylon Chips manufactured by the appellant are covered by E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring process relates to Nylon-6 of the respondent-company. Even the international organization, i.e. British Plastics Federation has also considered Nylon under the Plastics group. 19. Finally, the Tribunal observed that, even if plastic granules are Nylon Chips used in different industries, but the type of thing is Plastic, which is used as per the requirement. It is not necessary that these two items should be different items due to their use in different industries, and it has been accepted by the department that Nylon Chips have more strength, and is needed for better mechanical and chemical properties of engineering plastics. 20. Finally, the Tribunal held that Nylon Chips will fall under Entry 83 of Schedule II (B) of the Act, and the taxable liability cannot be 13.5%. Hence, the determination of tax liability, as unclassified, was wrong. For the Assessment Year 2010-11, the self-manufactured Nylon Chips in the State and Central are considered to be covered by Entry 83 of Schedule II (B) of the Act for the purpose of tax, and the appeals of the respondent-company was allowed by the Tribunal. 21. After going through the order passed by the Tribunal, the appellant-department ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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