Court quashes time-barred TNVAT Act notices, upholds petitioner's argument

The Court declared the impugned notices under the TNVAT Act, 2006 as time-barred and quashed them, given the absence of proceedings to exclude time under the relevant provisions. The petitioner's argument that the Department should have issued the notice within the prescribed period was accepted. The Court allowed the writ petitions without awarding costs.

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Issues:
Challenge to impugned notices under TNVAT Act, 2006 for Assessment Years 2007-2008, 2008-2009, and 2009-2010 based on an amendment to Section 22(2) of the Act in 2012.

Analysis:
The petitioner filed writ petitions to quash notices issued by the respondent under TNVAT Act, 2006 for specific Assessment Years. The petitioner relied on an instruction from the Commissioner of Commercial Taxes regarding the issuance of notices in cases barred by limitation. The petitioner argued that no proceedings were initiated to exclude time under Section 27(6), 27(7), and 27(8) of the TNVAT Act, 2006.

The respondent contended that the petitioner, engaged in selling Bakery Products under a specific brand name, was liable to pay tax at 12.5% for a specific period, leading to the issuance of the revision notice. The respondent also referenced a pending issue in another case before the Court to support their stance.

The Court examined the relevant provisions of the TNVAT Act, 2006, particularly the amendment to Section 22(2) in 2012, which deemed assessment completed on a specific date for certain Assessment Years. The Court noted that the avenue for revising assessment post the deemed completion date was under Section 27 of the Act, which also excluded specific periods for limitation calculation.

The Court accepted the petitioner's argument that no other proceedings were pending to exclude time under the Act's provisions. It emphasized that the Department should have issued the notice within the prescribed period as per the Act. Consequently, the Court declared the impugned notices as time-barred and quashed them, subject to the condition that the petitioner had filed complete returns for the respective years as required by Section 27 of the TNVAT Act, 2006.

In conclusion, the writ petitions were allowed, and no costs were awarded in the matter.

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