Limitation on best judgment assessment notices under sales tax laws: notices issued beyond the permissible period were quashed.

Show cause notices for best judgment assessment under the Tamil Nadu General Sales Tax and Tamil Nadu Value Added Tax regimes were challenged as time-barred. The Court applied the governing limitation framework for revision and escaped-turnover proceedings, and reiterated that where no specific period is prescribed for best judgment assessment, the power must still be exercised within a reasonable time. As the notices were issued beyond the outer permissible period applicable to the relevant assessment provisions, they were held unsustainable and were quashed.

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Issues: Whether the impugned show cause notices issued for best judgment assessment under the sales tax and value added tax regimes were barred by limitation.

Analysis: The notices were issued for assessment years governed by the Tamil Nadu General Sales Tax regime and the Tamil Nadu Value Added Tax regime. The governing provisions contemplated revision and escaped-turnover proceedings within prescribed outer limits, and the Court adopted the principle that, where no specific period is provided for best judgment assessment, the proceeding must still be initiated within a reasonable time. Applying the co-existing limitation framework earlier recognised for the relevant assessment provisions, the notices issued after the outer permissible period were held to be unsustainable.

Conclusion: The notices were held to be barred by limitation and were quashed.

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