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IN THE HIGH COURT OF JUDICATURE AT MADRAS
R.SURESH KUMAR, C.SARAVANAN, JJ.
M/s.Oliva Care, Represented by its Sole Proprietor Thiru S.U.Abu Thahir - Appellant
Versus
The State Tax Officer - Respondent
W.P.Nos.6153, 6156 and 6157 of 2021 and W.M.P.Nos.6772, 6774 and 6776 of 2021
Decided on : 18-09-2024
| Table of Content |
|---|
| 1. group of factual basis for the appeal. (Para 1) |
| 2. challenge to assessment orders based on incorrect tax details (Para 2 , 3 , 4 , 5) |
| 3. conflict in previous case judgments pertaining to tnvat act (Para 6 , 8) |
| 4. details of the assessment orders and their implications. (Para 7) |
| 5. deeming assessment completion date and implications for tax liabilities (Para 9 , 10 , 15) |
| 6. government's stance on incomplete returns and corresponding assessment authority (Para 11 , 12 , 14) |
| 7. arguments related to timelines and assessments. (Para 13) |
| 8. amendments to tnvat act related to assessment and penalties (Para 18 , 19 , 20) |
| 9. no limitation for initiation under section 22(4) of tnvat act (Para 24 , 27 , 30) |
| 10. final rulings on the limitations and assessments. (Para 31) |
| 11. court's conclusion regarding merits of the writ petitions (Para 32) |
| 12. conclusion of court ruling. (Para 33) |
ORDER :
C.SARAVANAN, J.
By this common order, all the writ petitions are being disposed of.
2. In these writ petitions, the petitioner has challenged the Impugned Assessment Orders dated 11.01.2021 passed by the respondent for the Assessment Years 2014-2015, 2015-2016 and 2016-2017.
3. By the Impugned Assessment Orders, the demand proposed in the notices that preceded the respective Impugned Assessment Orders have been confirmed.
4. The respective Assessment Orders impugned in these writ petitions have not only redetermined the taxable turn over of the petitioner but have also confirmed the differential tax payable by the petitioner under Section 22 (4) of the Tamil Nadu Value Added Tax Act, 2006 (hereinafter referred to as “TNVAT Act”) but had also imposed penalty under Section 22 (5) of TNVAT Act, 2006.
5. Extract of the differential tax and penalty confirmed in the respective Writ Petitions are as under:-
W.P.No.6153 of 2021 (Assessment Year 2014-2015)
Abstract:
| Tax | Penalty | Total | |
| Due | Rs.13,74,947/- | Rs.20,09,429/- | Rs.33,84,376/- |
| Paid | Rs. 35,328/- | Rs. 0/- | Rs. 35,328/- |
| Balance to be paid | Rs.13,39,619/- | Rs.20,09,429/- | Rs.33,49,048/- |
W.P.No.6156 of 2021 (Assessment Year 2015-2016)
Abstract:
| Tax | Penalty | Total | |
| Due | Rs.2,48,084/- | Rs.3,14,013/- | Rs.5,62,097/- |
| Paid | Rs. 38,742/- | Rs. 0/- | Rs. 38,742/- |
| Balance to be paid | Rs.2,09,342/- | Rs.3,14,013/- | Rs.5,23,355/- |
W.P.No.6157 of 2021 (Assessment Year 2016-2017)
Abstract:
| Tax | Penalty | Total | |
| Due | Rs.21,30,317/- | Rs.25,12,113/- | Rs.46,42,430/- |
| Paid | Rs. 4,55,575/- | Rs. 0/- | Rs. 4,55,575/- |
| Balance to be paid | Rs.16,74,742/- | Rs.25,12,113/- | Rs.41,86,855/- |
6. After these writ petitions were listed before the Writ Court on 05.02.2024, the Writ Court felt that there are conflicting views of this Court in the case of Tvl.Pupa Lineraa Vs. The State Tax Officer, Karur in W.P.(MD)No.14494 of 2021 dated 27.10.2021 and in the case of KAG India Private Limited Vs. Assistant Commissioner (ST), Chennai [2024] 121 GSTR 151 (Mad) rendered on 27.06.2023. Hence, the matter was placed before the Hon'ble The Chief Justice for appropriate orders.
7. Under these circumstances, the matter was directed to be posted before the Division Bench of this Court. Hence, these writ petitions are before us.
8. In Tvl.Pupa Lineraa case (cited supra), Writ Court presided over by a learned Single Judge of this Court has passed the following order:-
“38. Once a deeming provision comes into effect, for every assessment year, 31st October of the succeeding year is to be taken as a date where deeming provision comes into effect and every such return filed by the assessee within the time should be treated as a deemed assessment.
39. But, before the expiry of the deeming assessment period, the revenue wanted to invoke the best judgment theory by invoking Section 22 (4) of the TNVAT Act that would be possible for the revenue. However, once the deeming assessment is completed at the end of 31st October of the succeeding year, then that date shall be construed as an assessment date for the purpose of taking the limitation of six years for invoking the proceedings of revised assessment under Section 27 (1) (a) of the TNVAT Act.
40. In
No time limitation exists under Section 22(4) of the Tamil Nadu Value Added Tax Act for issuing assessment orders when conditions are met; penalties under Section 22(5) are valid for up to six years.
Statutory authorities must complete tax assessments within a reasonable time to ensure compliance with principles of natural justice, even if no specific period is explicitly defined in the law.
Assessments beyond five years are invalid without proper notice, and best judgment assessments require rejection of returns, which was not adhered to in this case.
The main legal point established in the judgment is that re-assessment proceedings must be initiated within the prescribed limitation period, and the assessing officer's determination of suppressed c....
Assessment orders quashed as barred by six-year limitation under S.27 TNVAT Act from prior assessments.
Retrospective amendments to tax legislation must not infringe upon accrued rights or create unfair disadvantages for assessees, ensuring reasonable time limits for assessments.
The court established that amendments to the KVAT Act's limitation provisions are prospective and do not apply retroactively to past assessments.
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