Reasonable time in reassessment proceedings bars unexplained delay, with Tamil Nadu VAT reassessment held unsustainable.

Reassessment under the Tamil Nadu Value Added Tax Act, 2006 was held unsustainable where the initiating notice was issued beyond six years from the deemed assessment and was therefore time-barred under the reassessment provision. Even on the view that an earlier notice had validly commenced proceedings within limitation, the subsequent reassessment steps remained unexplained for more than six years. The court applied the principle that, where no statutory period is prescribed for completion of reassessment, the authority must act within a reasonable time; inordinate and unexplained delay renders the proceedings arbitrary and liable to be quashed.

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Issues: Whether reassessment initiated under the Tamil Nadu Value Added Tax Act, 2006 was liable to be quashed on the ground of limitation or, in the alternative, on the ground that the reassessment proceedings were concluded after an unreasonable and inordinate delay.

Analysis: The reassessment notice issued in 2020 was beyond six years from the deemed assessment and was therefore time-barred if treated as the initiating notice under Section 27 of the Tamil Nadu Value Added Tax Act, 2006. Even on the assumption that an earlier notice in 2014 validly initiated proceedings within limitation, the later steps were taken after more than six years with no explanation for the delay. The legal position applied was that where the statute prescribes no period for completing reassessment, the authority must act within a reasonable time, and prolonged unexplained delay renders the proceedings arbitrary and unsustainable.

Conclusion: The reassessment order was unsustainable and was quashed in favour of the assessee.

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