Limitation on VAT reassessment notices: older assessment years were time-barred, while later years survived on timely demand basis.

Demand notices under the Tamil Nadu Value Added Tax Act were tested against the six-year reassessment limit for escaped turnover. For the assessment years 2006-07 to 2010-11, the court treated assessment as deemed completed on 30.06.2012 under the proviso to Section 22(2), and the notices issued later were therefore time-barred and quashed. For the assessment years 2011-12 to 2015-16, the notices were founded on an earlier demand issued within the permissible period, so limitation was not attracted and the demand was upheld. The contention that the notices formed one composite demand was rejected because the record showed two distinct notices for separate assessment periods.

---

---

Issues: Whether the demand notices issued under the Tamil Nadu Value Added Tax Act, 2006 were barred by limitation for the assessment years 2006-07 to 2010-11 and whether the notice for the assessment years 2011-12 to 2015-16 was within the permissible period.

Analysis: Section 27(1)(a) of the Tamil Nadu Value Added Tax Act, 2006 permits reassessment of escaped turnover within six years from the date of assessment. For the earlier years, the proviso to Section 22(2) deemed assessment to have occurred on 30.06.2012, and the demand was initiated only later, beyond the statutory period. The notices for the later years were based on an earlier demand made within six years and were therefore not hit by limitation. The challenge that the notices constituted a single composite demand was rejected because the materials showed two separate notices relating to distinct sets of assessment years.

Conclusion: The demand relating to the assessment years 2006-07 to 2010-11 was barred by limitation and was quashed, while the demand relating to the assessment years 2011-12 to 2015-16 was upheld.

---