2023 (3) TMI 1026 - HC - VAT and Sales Tax

Jurisdictional Overreach in Tax Revision Proceeding; Importance of Adhering to Limitation Periods

The court determined that the revisional authority under the Haryana Value Added Tax Act, 2003 had exceeded its jurisdiction by initiating revision ... Revisional powers of respondent-authorities under Section 61 (2) of the Haryana Value Added Tax Act, 2003 - after passing of the assessment order, no proceedings were pending under the Haryana General Sales Tax Act, 1973 - HELD THAT:- In the present case, the assessment order for the year 2002-2003 has been passed on 19.03.2007 (Annexure A-1). As per the judgment in EXCISE AND TAXATION COMMISSIONER, HARYANA VERSUS M/S FRIGOGLASS INDIA PRIVATE LIMITED AND ANOTHER [2019 (5) TMI 1178 - PUNJAB AND HARYANA HIGH COURT], period of three years would expire in the year 2006. However, this order in itself was beyond the period of limitation. Apart from this fact, the revisional authority, while exercising its powers under the Haryana General Sales Tax Act, 1973, had issued notice for revising the assessment order. On the date of issuing this notice, the authorities under the Haryana VAT Act had no jurisdiction to revise the order, as no assessment proceedings were pending when the order of revision was passed/issued. Once, Haryana VAT Act had come into force, the authorities could not issue the said notice, as the jurisdiction to issue such notice has not been saved in the saving clause under Section 61 (2) of the Haryana Value Added Tax Act, 2003. Hence, by applying the ratio of the aforesaid judgment on the facts of the present case, the impugned orders are held to be without jurisdiction. Since the assessment order was passed under the Haryana General Sales Tax Act, no proceedings could be initiated after coming into force the Haryana VAT Act, as has been done in the present case - Apart from that, as per the judgment passed in M/s Frigoglass India Private Limited’s case, the proceedings for the assessment year 2002-2003 had to be completed within a period of three years. However, the assessment order itself has been passed on 19.03.2007 (Annexure A-1). Appeal allowed. Issues:1. Jurisdiction of authorities under the Haryana Value Added Tax Act, 2003 to revise assessment orders under the Haryana General Sales Tax Act, 1973.2. Application of the Repeal and Saving clause under Section 61 of the Haryana Value Added Tax Act, 2003.3. Interpretation of limitation periods for assessment orders under the Haryana Value Added Tax Act, 2003.4. Consideration of relevant case laws and judgments in determining the legality of assessment orders.Analysis:1. The judgment addressed the issue of jurisdiction of authorities under the Haryana Value Added Tax Act, 2003 to revise assessment orders under the Haryana General Sales Tax Act, 1973. The appellant argued that the revisional authority exceeded its powers by issuing a notice for revision under the Haryana General Sales Tax Act, 1973 after the assessment order was passed. The appellant contended that no proceedings were pending under the old Act when the revision was initiated, thus questioning the validity of the revisional powers exercised.2. The court analyzed the Repeal and Saving clause under Section 61 of the Haryana Value Added Tax Act, 2003, which determines the transfer and disposal of pending proceedings from the old Act to the new Act. The judgment referred to previous cases and observed that the new law of the Haryana Value Added Tax Act applied to pending proceedings under the old Act, including the limitation periods for finalizing assessments. It was emphasized that the limitation period for assessment orders had to be computed from the date the new Act came into force.3. The interpretation of limitation periods for assessment orders under the Haryana Value Added Tax Act, 2003 was a crucial aspect of the judgment. The court cited specific sections of the Act to explain the timeframes for finalizing judgment assessments and best judgment assessments. It was highlighted that the limitation period for assessments had to be adhered to, and any orders passed beyond the prescribed time were considered void due to being barred by limitation.4. The judgment extensively discussed relevant case laws and judgments to support its decision on the legality of the assessment orders. References were made to previous rulings regarding the retrospective effect of the new Act, the application of limitation periods, and the necessity to conclude proceedings within the specified timeframes. The court relied on precedents to establish the legality of the assessment orders in question and ultimately set aside the impugned orders based on the analysis of the legal provisions and case laws presented in the judgment.