Limitation on reassessment of escaped turnover can invalidate a revised assessment and justify writ relief despite alternate remedy.
Reassessment of escaped turnover under section 16(1)(a) of the Tamil Nadu General Sales Tax Act, 1959 was held time-barred because the five-year limitation period expired on 31 March 2001, while the pre-revision notice was issued only on 14 April 2004 and the revised assessment on 1 June 2004. A later amendment changing the commencement point for limitation was treated as prospective and could not revive a claim already barred. The document also states that the alternative-remedy rule does not prevent writ interference where the impugned action is without jurisdiction or barred by limitation. On that basis, the reassessment was quashed and writ relief was upheld.
Issues: (i) Whether the revised assessment under section 16(1)(a) of the Tamil Nadu General Sales Tax Act, 1959 was barred by limitation; (ii) Whether the existence of an alternative statutory remedy barred interference under Article 226 of the Constitution of India.
Issue (i): Whether the revised assessment under section 16(1)(a) of the Tamil Nadu General Sales Tax Act, 1959 was barred by limitation.
Analysis: Section 16(1)(a) empowered reassessment of escaped turnover within five years from the expiry of the year to which the tax related. For the assessment year 1995-96, the five-year period expired on 31 March 2001. The pre-revision notice was issued only on 14 April 2004 and the revised assessment was made on 1 June 2004. The later amendment providing a different commencement point for limitation was held to be prospective and therefore inapplicable to a period already time-barred.
Conclusion: The revised assessment was statutorily barred by limitation and was invalid.
Issue (ii): Whether the existence of an alternative statutory remedy barred interference under Article 226 of the Constitution of India.
Analysis: The rule of alternate remedy does not operate as an absolute bar where the impugned action is without jurisdiction or is barred by limitation. Since the reassessment itself was found to be time-barred, the writ court's interference was justified notwithstanding the availability of an appellate remedy.
Conclusion: The availability of an alternative remedy did not preclude writ interference in the circumstances.
Final Conclusion: The reassessment was quashed as being time-barred, and the writ appeal succeeded with no order as to costs.
Ratio Decidendi: A reassessment made beyond the statutory period prescribed for escaped turnover is void, and the existence of an alternate remedy does not bar writ relief where the action is time-barred or otherwise without jurisdiction.
TaxTMI 
AI Drafter ✕
TaxTMI 
