M/S.Mundhra Bullion Pvt Ltd v. The Assistant Commissioner
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 08.05.2017
CORAM
THE HONOURABLE MR.JUSTICE K.RAVICHANDRABAABU W.P.No.9266 of 2017 W.M.P.Nos.10215 & 10216 of 2017 M/s.Mundhra Bullion Private Limited Rep. by its Direcotr, Mr.Ashish Mundhra No.20, Thulasingam Street, Sowcarpet, Chennai-600 079.
...Petitioner
Versus
The Assistant Commissioner (CT) Peddunaickenpet Assessment Circle No.48/39, Rajaji Salai Wavoo Mansion, 3rd Floor, Chennai-600 001.
...Respondent
Prayer:
Writ Petition filed under Article 226 of the Constitution of India, to issue a Writ of Certiorari, to call for the records of the respondent dated 27.02.2017 in TIN/33310281900/2014-15 and quash the same so far it relates to the tax liability determined due to the difference between the balance sheet and the returns, mismatch purchases and the difference between Annexure-I filed and Annexure-II of the other end dealer and the difference in the import purchases arrived by the respondent as per the departmental website.
For Petitioner : Mr.Murali Kumar For M/s.Mcgan Law Firm For Respondent : Mr.S.Kanmani Annamalai Additional Government Pleader (Tax)
ORDER
Today, the matter is listed before this Court in a special sitting during summer vacation. Both sides agreed for taking up the matter for final disposal, though the counter affidavit is not filed.
2. The petitioner is aggrieved by the order of assessment dated 27.02.2017 passed in respect of the assessment year 20142015. There are totally five issues involved in this case, which are as follows:-
(1) Difference between Balance Sheet and as per returns files.
(2) Difference between the Annexure-I filed and Annexure-II of the other end dealer.
(3) Mis-match purchases
(4) Tax on Melting Loss (5)Difference in the Import purchases.
3.It is represented by both sides that out of five issues, Issue Nos. 2, 3 and 5 relating to mis-match are covered by the decision of this Court made in W.P.No.105/2016 etc., dated 01.03.2017. Therefore, both sides submitted that the assessment, insofar as those three issues can be set aside and the matter may be remitted back to the Assessing Officer for re-doing the assessment. Insofar as the Issue Nos. 1 and 4 are concerned, the learned counsel for the petitioner submits that the petitioner is not pressing the writ petition in respect of as those two issues. In other words, it is the contention of the petitioner that they are accepting the order of assessment insofar as those two issues viz., Issue Nos. 1 and 4 and willing to pay the tax due in respective of such issues.
4. It is seen that out of five issues, the Issue Nos.2, 3 and 5 are relating to mis-match and covered by the decision of this Court made in W.P.No.105/2016 etc., dated 01.03.2017, wherein this Court at Para No. 56 to 58, it has been observed as follows :- "56.The procedure adopted under the Maharastra VAT Act appears to be a more reasonable procedure, the Rules have been so designed constitute independent authorities, who will in exercise jurisdiction to dispose of the objections etc. However, this Court cannot legislate nor direct the State to legislate in a particular passion and it is for the state to bring about and appropriate rules and set procedures so that when discrepancy is noted while comparing the return with that of the figures available with the Department in their web portal, there should be an exercise carried out by the department within its
level before calling upon the dealer to show cause. This can be achieved only if there is a centralised mechanism and if the present practice is allowed to prevail, it would only result in multiplicity of proceedings with more number of cases pending before the Courts Appellate forums, thus jeopardizing the interest of revenue.
Therefore, it is high time the Principal Secretary and Commissioner of Commercial Taxes in consultation with him officers lays out a detailed procedure as to how to take forward cases of mismatch, evolve a central mechanism, which can go into these aspect and furnish details in full form to the respective Assessing Officers, who can decide for themselves as to whether there is a case made out to call upon their dealer to explain. If this centralized mechanism is not put in place exclusively for such purpose, it would result in notices and orders being issued by the respective Assessing Officers without even the knowledge of the Assessing Officer of the other end dealer resultantly no action being taken against other end dealer, assuming, he is at fault. Therefore, it is high time the Department wakes up and stops the one way approach and examine the matter in a holistic manner so that the defaulting dealer is brought to books.
57.Hence, for all the above reasons, all the Writ Petitions are allowed and the notices/orders either original or appellate or revisional are set aside and the matters are remanded the respective Assessing Officers, to undertake a fresh exercise by conducting a thorough enquiry in consultation with the Assessing Officers of the other end dealer for which purpose the Commissioner of Commercial Taxes shall empower the Assessing Officers to seek information from other circles as well and in the mean time to evolve a centralized mechanism to exclusively deal with the cases of mismatch and while
doing so, the Principal Commissioner shall take note of the procedures adopted by the other States, more particularly, in Maharastra, Gujarat and Delhi and if any statutory amendments have to be made, make appropriate recommendations to the State Government, and till then to devise a procedure which is fair and reasonable afford an opportunity to the dealer to putforth his case and establish that he is entitled to the concession/set-off availed.
58.Since these Writ Petitions have been allowed and the impugned orders have been set aside and the matters have been remanded for fresh consideration the petitioners/ dealers are not entitled to raise the plea of limitation, when fresh show cause notices are issued and they are directed submit their explanation to enable the Assessing Officers to adjudicate their case.
The Court places on record the valuable assistance of Ms.R.Charulatha Advocate of M/s.
Lakshmikumaran Sridharan Attorneys. consequently, connected miscellaneous petitions are closed.
No costs."
5.Thus, this Court is of the view that the Assessing Officer has to re-do the three issues viz., Issue Nos. 2, 3 and 5 by following certain guidelines / procedures issued in the above said decision of this Court made in W.P.No.105/2016 etc., dated 01.03.2017. Since the petitioner is not pressing the writ petition insofar as the Issue Nos. 1 and 4 are concerned, it is for the petitioner to pay the tax due arising out of those issues without fail.
6. Accordingly, this writ petition is allowed in part and the impugned order of assessment is set aside only insofar as the issues viz., Issue No.2 Difference between the Annexure-I filed and Annexure-II of the other end dealer, Issue No.3 Mismatch purchases and Issue No.5 Difference in the Import purchases. Consequently, the matter is remitted back to the Assessing Officer for re-doing the assessment only insofar as these three issues viz., Issue Nos.2, 3 and 5, by giving personal hearing to the petitioner and by following the order made in WP.No.105 of 2016 etc., dated 01.03.2017. Such exercise shall be done by the respondent within a period of eight weeks from the date of receipt of a copy of this order. Insofar as the Issue Nos. 1 and 4 viz.
, Difference between Balance Sheet and as per returns files and Tax on Melting Loss, are concerned, the assessment order stands and the petitioner is bound by such assessment and liable to pay the tax due. Consequently, connected miscellaneous petitions are closed. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To The Assistant Commissioner (CT) Peddunaickenpet Assessment Circle No.48/39, Rajaji Salai Wavoo Mansion, 3rd Floor, Chennai-600 001.
+1 CC to M/s.Mcgan Law Firm, sr 36932 +1 CC to Govt. Pleader sr 36842 Writ Petition No.9266 of 2017 RJ(CO) sp/22/5