Limitation under VAT proceedings starts with initiation to proceed, not with survey notices seeking records and explanations.

Survey notices issued after inspection under the Rajasthan VAT regime, which only required production of records and explanation of material found, did not amount to initiation of proceedings for limitation purposes. Proceedings commenced only when the competent authority, after considering the survey report, concluded that action was warranted and issued the notice initiating proceedings. The later notice was therefore within time, and the challenge to the initiation of VAT proceedings failed. The order directing registration of the case was also not shown to be under challenge, and no legal infirmity was found in the impugned judgment.

---

---

Issues: Whether the proceedings initiated under the Rajasthan Value Added Tax Act, 2003 were barred by limitation on the footing that the earlier survey-related notices amounted to initiation of proceedings, and whether the later notice and order directing registration of the case suffered from illegality.

Analysis: The survey notices issued after inspection were only to require production of records and explanation of the material found during survey; they were not notices initiating proceedings for evasion or wrongful availment of input tax credit. The decision to proceed under the Act was taken only after the survey report was submitted and the competent authority concluded that a case for action existed. On that basis, the date of the notice issued for initiation of proceedings was the relevant starting point for limitation, not the date of the survey or the preliminary notices. The record also showed that the order directing registration of the case was not challenged.

Conclusion: The proceedings were not time-barred, and the notices and impugned judgment did not suffer from any legal infirmity warranting interference.

Final Conclusion: The challenge to the initiation of VAT proceedings failed, and the appellate interference was declined.

Ratio Decidendi: For limitation under the VAT regime, proceedings commence when the assessing authority forms the conclusion to proceed on evasion or wrongful credit, and mere survey notices calling for documents do not amount to initiation of proceedings.

---