Commissioner's discretion in tax assessment case challenged under Assam VAT Act; petitioner to comply with court order.

The court found that the Commissioner did not exercise discretion judiciously in a tax assessment and penalty case under the Assam Value Added Tax Act, 2003. The petitioner agreed to pay the remaining amount and furnish a bank guarantee within two months. The court set aside the previous order, directing compliance within the specified timeframe for further proceedings. The petitioner was instructed to cooperate for the prompt resolution of the case. The writ petition was disposed of without costs.

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Issues Involved:
1. Assessment of tax and imposition of penalty under the Assam Value Added Tax Act, 2003.
2. Requirement for deposit of 25% of the disputed liability for admission of revision petition.
3. Arbitrary handling of the petitioner's prayer for stay of the notice of demand.
4. Exercise of discretion by the Commissioner under section 82(2A) of the Assam Value Added Tax Act, 2003.

Issue-wise Detailed Analysis:

1. Assessment of Tax and Imposition of Penalty:
By order dated February 26, 2008, an assessment of tax payable by the petitioner under the Assam Value Added Tax Act, 2003, was made by the Superintendent of Taxes, Unit "B", Guwahati, amounting to Rs. 50 lakhs. Additionally, the petitioner was directed to show cause as to why a penalty of Rs. 1.50 crore should not be imposed. Subsequently, on March 19, 2008, a penalty of Rs. 1.50 crore was imposed, resulting in a total demand of Rs. 2 crores.

2. Requirement for Deposit of 25% of the Disputed Liability:
The petitioner filed a revision petition before the Commissioner of Taxes, Unit "B", Guwahati, and prayed for a stay of the demanded amounts. On July 1, 2008, the Commissioner directed the petitioner to deposit 25% of the disputed liability, amounting to Rs. 50 lakhs, for the revision to be admitted. Due to non-payment, the revision was dismissed on January 1, 2009. The petitioner later applied for a review and requested to deposit Rs. 25 lakhs and furnish a bank guarantee for the remaining Rs. 25 lakhs. This was accepted by the Commissioner on April 9, 2009. However, the petitioner failed to comply fully, leading to the dismissal of the revision petition on May 8, 2009.

3. Arbitrary Handling of the Petitioner's Prayer for Stay:
The petitioner argued that the Commissioner dealt with the prayer for stay arbitrarily, insisting on the deposit of 25% of the disputed amount without assigning reasons. The petitioner referenced the case of Hardeodas Jagannath v. Income-tax Officer, Shillong, to support the claim that the discretion must be exercised judicially and not arbitrarily.

4. Exercise of Discretion by the Commissioner:
Under section 82(2A) of the Assam Value Added Tax Act, 2003, the Commissioner has the discretion to admit a revision application with part payment or without payment of the disputed amount to mitigate undue hardship. This discretion must be exercised with utmost care and attention, ensuring that the decision is judicious and not arbitrary. The Commissioner must assign cogent reasons for either granting or refusing a stay. The court observed that the manner in which the Commissioner handled the petitioner's case was unsatisfactory, as the initial order did not indicate consideration of the grounds for suspension or stay.

Conclusion:
The court concluded that the Commissioner did not exercise discretion judiciously. The petitioner agreed to pay the remaining amount of Rs. 19 lakhs and furnish a bank guarantee of Rs. 25 lakhs within two months. The court set aside the impugned order dated May 8, 2009, and directed the petitioner to comply with the payment and bank guarantee requirements within two months. Upon compliance, the Commissioner was directed to hear and dispose of the revision petition in accordance with the law within two months. The petitioner was also directed to cooperate with the authorities for the early disposal of the revision proceedings. The writ petition was disposed of with no order as to costs.

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