Limitation bars revisional notice: quashed VAT assessment orders cannot be reissued as fresh notices after expiry.

Section 9(2) of the Central Sales Tax Act allows State authorities to apply the assessment machinery and powers of the relevant State sales tax law for CST proceedings, so Tamil Nadu VAT procedures could govern the assessments to that extent. However, assessments made under Section 22(2) of the Tamil Nadu Value Added Tax Act were found unsustainable on the deemed assessment framework and their quashing was upheld. A further direction treating the quashed assessment orders as notices under Section 27 of the Tamil Nadu Value Added Tax Act was also impermissible because the five-year limitation for revision had already expired. The time-barred revisional exercise could not be revived by recharacterising quashed orders as fresh notices.

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Issues: (i) whether assessments under the Central Sales Tax Act could be made by applying the procedure and powers available under the Tamil Nadu Value Added Tax Act; (ii) whether the quashed assessment orders could be treated as notices under Section 27 of the Tamil Nadu Value Added Tax Act despite the lapse of limitation.

Issue (i): whether assessments under the Central Sales Tax Act could be made by applying the procedure and powers available under the Tamil Nadu Value Added Tax Act.

Analysis: Section 9(2) of the Central Sales Tax Act authorises the State authorities empowered under the general sales tax law to assess, reassess, collect and enforce tax payable under the Central enactment and to exercise the powers available under the State law for that purpose. Since the Tamil Nadu Value Added Tax Act is the relevant State sales tax law, the assessment machinery under that Act governs proceedings under the Central Sales Tax Act to the extent permitted by Section 9(2). The assessment orders made under Section 22(2) of the Tamil Nadu Value Added Tax Act were therefore not sustainable once the deemed assessment framework was applied, and the quashing of those orders was justified.

Conclusion: The challenge to the assessments on jurisdictional grounds was not accepted, but the use of Section 22(2) for those assessments was held unsustainable and the quashing of the assessment orders was upheld.

Issue (ii): whether the quashed assessment orders could be treated as notices under Section 27 of the Tamil Nadu Value Added Tax Act despite the lapse of limitation.

Analysis: Section 27(2) of the Tamil Nadu Value Added Tax Act prescribes a five-year limit for revising assessment and proceeding against wrong availment of input tax credit. The deemed assessments were reckoned as having been completed on 30.06.2012, and by the time of the common order in 2021 the statutory period for issuing a valid notice under Section 27 had already expired. The direction treating the quashed assessment orders as notices under Section 27 would therefore revive a time-barred proceeding and could not be sustained.

Conclusion: The direction treating the assessment orders as notices under Section 27 was held impermissible and was set aside.

Final Conclusion: The appellate court sustained the setting aside of the further directions in the common order and granted the writ relief sought by the assessee, leaving no surviving basis to continue the revised assessment exercise.

Ratio Decidendi: Where a notice or proceeding under the revisional power of the State sales tax law is barred by the statutory period of limitation, it cannot be validated by recharacterising an already quashed assessment order as a fresh notice.

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