2015 (1) TMI 339 - HC - VAT and Sales Tax

Court upholds assessment validity under TNGST Act, stresses procedural compliance

M/s. Chandra Textiles Private Limited Versus The Commercial Tax Officer

The court dismissed the Writ Petition challenging the assessment order under the TNGST Act for the year 2002-03. The court held that the petitioner's ... Assessment to be made u/s 12C of the TNGST Act or not – Held that:- The petitioner has filed his objections dated 27.05.2008, in which, they did not raise the contention that on account of insertion of Section 12-C of the TNGST Act, the assessment has to be made u/s 12-C of the TNGST Act, rather the petitioner resisted the Department's view by contesting the matter on merits - the petitioner fully participated in the assessment proceedings and the same has ultimately resulted in the impugned order - therefore, on the grounds raised by the petitioner stating that after the introduction of Section 12-C of the TNGST Act, the AO could not have passed the order is a submission, which deserves to be rejected - The case of the petitioner does not fall within the ambit of Section 12-C of the TNGST Act and it is a matter pertaining to AY 2002-03 and proceedings were initiated in 2004 - the petitioner also knowing fully well participated in the assessment proceedings by submitting their objections - therefore, it is too late for the petitioner to now come before this Court and contend that the assessment should have been done u/s 12-C of the TNGST, hence, the order of assessment cannot not be quashed – Decided against petitioner. Issues:Challenge to assessment order under TNGST Act for the year 2002-03 based on objections not considered by Assessing Officer and reliance on Bombay High Court decision. Interpretation of newly inserted Section 12-C of TNGST Act and its applicability to assessment proceedings. Conflict regarding procedure for assessment under Section 12-C pending resolution by Division Bench.Analysis:The petitioner, a registered dealer under TNGST Act, challenged an assessment order for the year 2002-03, raising objections not addressed by the Assessing Officer who relied on a Bombay High Court decision. A previous Writ Petition led to remand for detailed consideration of objections. The petitioner contended that Section 12-C of TNGST Act, introduced post the previous Writ Petition, should have governed the assessment. However, the court noted that the petitioner participated in the assessment proceedings without invoking Section 12-C, hence rejecting the argument that the assessment was invalid under the new provision.The petitioner cited precedents where courts quashed assessments for non-compliance with Section 12-C, emphasizing the need for Assessing Officers to follow prescribed procedures. However, the court differentiated cases where Assessing Officers can request documents or reject claims even under Section 12-C. The court highlighted that automatic acceptance of returns without verification could lead to chaos and upheld the Assessing Officer's right to examine returns.A subsequent Writ Petition raised concerns over the unresolved conflict on assessment procedures under Section 12-C pending before a Division Bench. The court acknowledged the issue's significance but deemed it unnecessary to await the Division Bench's decision in the present case. The court emphasized the petitioner's active participation in the assessment process post the previous Writ Petition, concluding that the assessment order could not be quashed solely based on the introduction of Section 12-C. The dismissal of the Writ Petition allowed the petitioner to appeal to the Appellate Authority within 30 days without the limitation of time being a ground for rejection.In conclusion, the judgment clarified the application of Section 12-C to assessment proceedings, highlighted the importance of following prescribed procedures, and addressed the unresolved conflict on the assessment process pending before a Division Bench. The court's decision focused on the petitioner's participation in the assessment proceedings and upheld the validity of the assessment order despite the introduction of Section 12-C post the initial Writ Petition.