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of <h1>Reassessment order under Section 40(1) quashed for being time-barred beyond eight-year statutory limitation period</h1> The HC quashed a reassessment order passed under Section 40(1) of the Assam Value Added Tax Act, 2003, finding it time-barred under Section 40(2). The ... Challenge to order of reassessment done in terms with Section 40(1) of the Assam Value Added Tax Act, 2003 - challenge on the ground that the said reassessment order is contrary to Section 40(2) of the Act of 2003 - HELD THAT:- From Sub-Section (2) of Section 40 of the Act of 2003, it would be seen that no assessment and reassessment shall be made under Sub-Section (1) of Section 40 of the Act of 2003 after the expiry of 8 years from the end of the year in respect to which or part of which the tax is assessable. The said provision does not mention anything about initiation of assessment or reassessment proceeding rather it stipulates that no order of assessment or reassessment would be passed after the expiry of 8 years from the end of the year in respect of which or part of which the tax is assessable. In the instant case, the assessment is for the financial year 2007-2008 and the period ends on 31.03.2008. The period within which an assessment or reassessment can be done in terms with Sub-Section (1) of Section 40 of the Act of 2003 in respect to the financial year 2007-2008 would have been on or before 31.03.2016. In the instant case, the Assessment Order was passed on 22.11.2022 and the same is apparently barred under Sub-Section (2) of Section 40 of the Act of 2003. The impugned Assessment Order for the financial year 2007-2008 dated 22.11.2022 is set aside and quashed -The impugned Notice of Demand dated 22.11.2022 for the financial year 2007-2008 is set aside and quashed -The proceedings for recovery so sought to be made vide the Bakijai proceedings so initiated enclosed as Annexure-21 is set aside and quashed - Petition allowed. ISSUES: Whether the reassessment order passed under Section 40(1) of the Assam Value Added Tax Act, 2003 is barred by the limitation period prescribed under Section 40(2) of the Act.Whether the assessment order dated 22.11.2022 for the financial year 2007-2008 complies with the statutory time limit for issuance of assessment or reassessment orders under the Act of 2003. RULINGS / HOLDINGS: The reassessment order dated 22.11.2022 is barred by limitation as it was passed beyond the period of eight years from the end of the relevant financial year, in violation of Section 40(2) of the Act of 2003.Section 40(2) explicitly states that 'no order of assessment and reassessment shall be made under subsection (1) after the expiry of eight years from the end of the year in respect of which or part of which the tax is assessable.' Therefore, the assessment order for the year 2007-2008 passed on 22.11.2022 is 'apparently barred' and is set aside along with the associated Notice of Demand and recovery proceedings. RATIONALE: The Court applied the statutory limitation provision contained in Section 40(2) of the Assam Value Added Tax Act, 2003, which imposes an absolute bar on passing assessment or reassessment orders beyond eight years from the end of the relevant financial year.The Court emphasized that the limitation applies to the passing of the order itself and not merely to the initiation of proceedings, noting that the assessment for the financial year 2007-2008 should have been completed on or before 31.03.2016.Since the impugned assessment order was passed on 22.11.2022, it fell outside the statutory period, resulting in the order being quashed. No unique interpretation or dissent was noted in the judgment.
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