1995 (9) TMI 362 - HC - VAT and Sales Tax

Court Invalidates Reassessment Order Due to Time Limit Expiry

Hmt Limited Versus State of Uttar Pradesh and Others

Hmt Limited Versus State of Uttar Pradesh and Others - [1997] 104 STC 411 (All) Issues:1. Validity of the order reopening and reassessment for the assessment year 1984-85 under the U.P. Trade Tax Act.2. Effect of subsequent amendment on the limitation period for reassessment.3. Availability of appeal against the order passed under section 21 of the U.P. Trade Tax Act.4. Alternative remedy and the jurisdiction of the court in interfering with the matter.5. Compliance of departmental authorities with judicial pronouncements.Detailed Analysis:1. The petitioner challenged the order reopening and reassessment for the assessment year 1984-85 under the U.P. Trade Tax Act. The petitioner contended that the limitation period for reopening the assessment had expired in 1989, and the subsequent amendment in 1991 could not affect the already expired limitation period. The petitioner relied on previous court decisions, including a Division Bench decision and a Supreme Court decision, to support the argument that vested rights cannot be divested by a subsequent amendment. The court agreed with the petitioner's contention and held that the order of the Commissioner was illegal due to the expired limitation period.2. The court examined the effect of the subsequent amendment on the limitation period for reassessment. The court referred to previous judgments, including one by another Division Bench, to establish that where the limitation period had expired before the amendment, the reassessment would be without jurisdiction. The court emphasized that the law declared by the court through judicial pronouncements must be followed by all authorities and tribunals, and non-compliance with such pronouncements was deprecated.3. The petitioner argued that no appeal lies against an order passed under section 21 of the U.P. Trade Tax Act for initiating an assessment. The petitioner contended that since no appeal could be filed against the order, the impugned order of the Additional Commissioner could not be set aside by the appellate authority. The court considered this argument and found merit in the petitioner's contention regarding the absence of an appeal against the order.4. The State resisted the petition on the ground of the availability of an alternative remedy, stating that the petitioner had already preferred an appeal. However, the petitioner argued that the departmental authorities were bound by orders passed by higher authorities, rendering the alternative remedy illusory. The court observed that despite clear judicial pronouncements, the departmental authorities were taking a contrary view, and non-compliance with judicial pronouncements was not acceptable. The court held that in such circumstances, where there was a justified apprehension of injustice, the writ petition under Article 226 of the Constitution was justified.5. The court emphasized the importance of compliance by departmental authorities with judicial pronouncements. The court noted that all authorities and tribunals were bound by the law declared through judicial pronouncements and deprecated the practice of not acting in accordance with such pronouncements. Consequently, the court allowed the writ petition, setting aside the impugned orders passed by the Additional Commissioner and the assessment order.In conclusion, the court's judgment focused on the legality of the order for reopening and reassessment, the impact of subsequent amendments on limitation periods, the availability of appeal, the jurisdiction of the court in interfering with alternative remedies, and the necessity of compliance by departmental authorities with judicial pronouncements.