Provisional assessment request for turnover discount must be decided before refund is rejected as time barred
Where turnover discount was to be quantified after clearance, the departmental circular permitted provisional assessment if the assessee disclosed the intended discount and requested such assessment. The assessee had made that request, and the revenue was required to decide it by accepting or rejecting provisional assessment. In the absence of any order on that request, the refund claim could not be rejected solely as time barred on the footing that the assessments were not provisional. The impugned order was set aside and the matter remanded for reconsideration on merits.
Issues: Whether the refund claim arising from turnover discount could be rejected as time barred when the assessee had requested provisional assessment in terms of the Board circular.
Analysis: The circular stated that where discounts are not readily known at the time of clearance and are to be quantified later, assessment may be made provisionally, provided the assessee discloses the intention to allow such discount and requests provisional assessment. The assessee had made such a request by letter, and this fact was noticed in the impugned order. Once a request for provisional assessment is made, the request must be decided by the revenue by passing an order either accepting or rejecting it. In the absence of any order on that request, the refund claim could not be rejected on the sole ground that the assessments were not provisional.
Conclusion: The rejection of the refund claim on the ground of limitation could not be sustained, and the matter required fresh decision on merits treating the request for provisional assessment as having been made.
Final Conclusion: The impugned order was set aside and the claims were sent back for reconsideration by the adjudicating authority.
Ratio Decidendi: Where an assessee seeks provisional assessment in terms of the departmental circular for discounts ascertainable only later, the request must be decided by the revenue, and refund cannot be denied merely because no order was passed on that request.
TaxTMI 
AI Drafter ✕
TaxTMI 
