K.Annamalai v. The Commercial Tax Officer
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 18.08.2016
CORAM
THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM W.P.No.33007 of 2004 and W.P.M.P.No.39920 of 2004 K.Annamalai ` .. Petitioner
Versus
The Commercial Tax Officer, Thiruvannamalai II Assessment Circle, Thiruvannamalai.
.. Respondent Prayer: This Writ Petition is filed under Article 226 of the Constitution of India, seeking for a Writ of Certiorari to call for records for the records of the respondent in his proceedings in RC-B1 4185/2003 dated 15.03.2014 and to quash the same as illegal.
For Petitioner : Mr.S.Ramanathan For Respondent : Mr.S.Kanmani Annamalai, Additional Government Pleader
O R D E R
Heard Mr.S.Ramanathan, learned counsel appearing for the petitioner and Mr.S.Kanmani Annamalai, learned Additional Government Pleader appearing for the respondent. 2.The petitioner has filed this writ petition challenging the assessment order passed under the erstwhile Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as TNGST Act) for the year 1997-98. The assessment was made on the petitioner on best of judgment basis and though the petitioner was summoned to produce the books of accounts, he did not do so and pre-assessment notice was issued on 10.02.2004 and served on the petitioner on 13.02.2004 and in spite of receipt of the notice, the petitioner had filed their objections and therefore the assessing officer completed the assessment which has resulted in the impugned order.
3.The learned counsel appearing for the petitioner submitted that the impugned proceedings is clearly barred by limitation as it is an assessment under section 16 of the TNGST Act and the relevant assessment year is 1997-98 and in terms of the section 16(1)(a) of the TNGST Act, the assessment of the escaped
turnover could have been made at any time from the expiry of the year to which the tax relates. It is contended that in so far as the petitioner's case is concerned, the relevant year being 1997-98 the escaped turnover could have been reassessed within a period of five years from the date of which the year of assessment relates which will come to an end on 31.03.2003. It is pointed out that the notice for best judgment assessment in the instant case was issued on 10.02.2004 and therefore it is barred by limitation. In support of such contention, the learned Counsel placed reliance on the decision in bears all the decision in Regional Assistant Commissioner of Sales Tax, Indore vs. Malwa Vanaspati and Chemicals Co. Ltd. (21 STC 431) and Ramakutty Nadar vs. State of Madras (Mad)(31 STC 44).
Further the reliance was also placed in the decision of the Rajasthan High Court in the case of Jaipur Udyog Ltd., vs. Commercial Taxes Officer [(1979) 44 STC 456 (Raj)] which has been followed by this Court in the case of Venkateswara & Co., Vs. Deputy Commercial Taxes Officer [(2005) 133 STC 606]. 4.The learned Additional Government Pleader appearing for the respondent submitted that the proceedings were initiated prior to the cut-off date and three summons were issued to the dealer on 27.01.2003, 12.03.2003 and 01.04.2003 and admittedly two of the summons were prior to 31.03.2003 and even assuming that the impugned assessment is one under Section 16(1)(a) of the TNGST Act, the proceedings having commenced before the cutoff date is valid. He also relied upon the decision in the case of Dattaram Advertising Private Ltd. and another vs.
State of Karnataka reported in 1991 Vol.81 STC 394 to contend that there is a distinction between investigation of facts and initiation of proceedings depending on the discovery of facts and issuance of notice calling upon the assessee to produce the books of accounts cannot be construed as initiation of the proceedings.
5.Though elaborate submissions were made by the learned Counsel on both sides. In my view, if the factual position in the instant case is examined, it is evidently clear that the action initiated by the respondent is well within the period of limitation. Initially, the assessment was completed by the Commercial Tax Officer, Tiruvannamalai I Assessment Circle and an order passed on 10.03.2000. As against this order the petitioner had preferred an appeal before the Appellate Authority which was rejected as time barred, as against which, the petitioner filed an original petition before the Tamil Nadu Taxation Special Tribunal in O.P.No.1019 of 2002. The contention raised by the petitioner was that the Commercial Tax Officer, Tiruvannamalai I Assessment Circle has no jurisdiction and the competent authority would be only the Commercial Tax Officer,
Tiruvannamalai-II. This original petition was pending before the Tribunal and was allowed by an order dated 23.12.2002 holding the Commercial Tax Officer, Tiruvannamalai I Assessment Circl has no jurisdiction to pass the assessment order. 6.It is thereafter the summons were issued to the petitioner on 27.01.2003, 12.03.2003 and 01.04.2003 for production of the books of accounts and relevant papers. However, the petitioner did not honour the summons. Thereafter, notice of best judgment was issued on 10.02.2004. Though this was received by the petitioner, he did not respond to the notice and ultimately, the Assessing Officer completed the assessment and passed the impugned order.
Sub-section (6) of Section 16 of the TNGST Act states that while completing the period of limitation for assessment or re-assessment, the time during which the appeal or proceedings are pending before the Appellate Authority or the Revisional Authority or the Special Tribunal or the Supreme Court shall be excluded. By applying the said provisions, time between the original order of assessment dated 10.03.2000 to the order passed by the Tribunal dated 23.12.2002 should stand executed because after the Original Assessment order was passed, the petitioner filed an appeal before the first Appellate Authority, namely, the Appellate Assistant Commissioner (CT), Fort Round, Vellore and appeal was rejected as time barred.
It is thereafter the original petition was filed before the Special Tribunal in the year 2002 which was disposed of by order dated 23.12.2002. Thus if the time during which the matter was pending before the Appellate Authority and the Special Tribunal is excluded, then the impugned proceedings is not barred by limitation. Thus the plea that the impugned order is barred by limitation stands rejected.
7.This leaves us with the only question as to whether the impugned order of assessment was passed in a proper manner. The facts noted above clearly shows that the petitioner did not cooperate in the assessment proceedings. He did not produced the books of accounts and when summons were produced, he did not submit his objections to the notice of best judgment and has approached by this court challenging the assessment order. 8.The learned Counsel for the petitioner pleads that the petitioner has purchased the goods from registered dealers and all documents are available with the petitioner and if one opportunity is granted to the petitioner to go before the Assessing Officer, the petitioner would be able to substantiate that the purchasers were made from registered dealers. 9.Considering the above submissions, while rejecting the contentions raised by the petitioner that the impugned
proceedings are barred by limitation, liberty is granted to the petitioner to treat the impugned proceedings as show cause notice and submit their objections within a period of two weeks from the date of receipt of copy of this. On receipt of the objections, the respondent shall afford an opportunity to the petitioner in which the petitioner shall produce the documents and books of accounts to show that they effected purchases from registered dealers and after perusing all the documents and considering the objections, the respondent shall re-do the assessment in accordance with law.
10.With the above observations, the writ petition is disposed of. No costs. Consequently, connected miscellaneous petition is closed.
Sd/- Asst. Registrar.
/true copy/ Sub Asst. Registrar.
cse/pvs To The Commercial Tax Officer, Thiruvannamalai II Assessment Circle, Thiruvannamalai.
+1 CC to Mr. S. Ramanathan, Advocate, Sr.47059 +1 CC to Spl. Govt., Pleader, Sr.No.27250 W.P.No.33007 of 2014 & W.P.M.P.No.39920 of 2004 LRS (CO) MD : 14/09/2016