TaxTMI 
TaxTMI 
2012 (2) TMI 454
X X X X Extracts X X X X
X X X X Extracts X X X X
....is a company incorporated under the provisions of the Companies Act, 1956 and engaged in the manufacturing of "white crystal sugar" at its sugar mill situated in Village Patran, District Patiala. Sugar is manufactured from sugarcane and its bye-products are molasses, bagasse, etc. The bardana is purchased by the petitioner to pack and store the "white crystal sugar" manufactured by it. On March 7, 1991, the Ministry of Industries, Government of India, issued a letter of intent in favour of the Punjab State Federation of Cooperative Sugar Mills Ltd., for manufacturing of "white crystal sugar". Subsequently on February 22, 1994, the petitioner was permitted to implement the said letter of intent. The petitioner has claimed that "sugar" is amongst the items mentioned in Schedule B of the Act and exempted from payment of tax. 4. It has been pointed out that on September 28, 1992, the respondentState of Punjab notified a "Package of Incentives-1992" with a view to augment new industrial investment in the State. Various incentives in the form of investment and sales tax exemption were offered to new industrial units being set up on or after October 1, 1992. As per clause 7(ii) of the "P....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... for 84 months for an amount of Rs. 36,68,43,000 (P3). On February 5, 1996, the Assistant Excise and Taxation Commissioner, Patiala, issued the exemption certificate granting exemption to the petitioner from payment of sales tax from December 21, 1994 to December 20, 2001 for an amount of Rs. 36,68,43,000 (P4). Thereafter, the petitioner started claiming and it was granted exemption from payment of sales tax on sale of the by-products of "white crystal sugar", i.e., molasses, bagasse, etc., manufactured at its sugar mill. It was also granted exemption from payment of sales tax on sale of bardana from its sugar mill. 6. On June 4, 2004, the assessing authority passed an assessment order in respect of the assessment year 1998-99 and tax exemption to the tune of Rs. 2,08,18,623 was allowed (P5). While passing the said assessment order the assessing authority has also taken into account the sale of bardana and molasses by the petitioner during the year. 7. It has been pointed out that on October 3, 2002 the petitioner was declared as a sick unit by the Board for Industrial and Financial Reconstruction (BIFR) under the provisions of the Sick Industrial Companies (Special Provisions) A....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ondent Nos. 1, 3 and 4 the factual position has not been disputed. It has been stated that on realising that the petitioner was not entitled to any exemption from the payment of tax on the sale of bardana, i.e., packing material and molasses, the assessing authority has rightly passed the orders dated March 31, 2009. An objection has been raised that the petitioner has not availed of the remedy of filing of appeal provided under section 20(1) of the Act by depositing 25 per cent of the demand under section 20(5) of the Act. Thus, the petitions are liable to be dismissed having been filed without exhausting the alternative remedy available under the statute. It has further been asserted that since the exemption certificate to the petitioner was issued only in respect of "white crystal sugar", therefore, exemption from payment of tax on any by-product could not have been granted. In para 18 of the reply on merits it has been submitted that the assessment of the petitioner for the assessment year 1998-99 was completed on June 4, 2004 (P5). However, the then assessing authority had wrongly adjusted the demand against the exemption amount available to the petitioner because the exemptio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....etitioner's contention based on the provisions of "SICA". On the question of limitation of five years as engrafted by section 11A of the Act, learned State counsel has submitted that the notice issued in December 2008 has to be regarded within limitation because the assessment order was passed on June 4, 2004 (P5). According to her the period of five years would commence from the date of passing of the assessment order and not from the end of the period of assessment year for which reassessment is sought to be made. Another submission made by the learned counsel is that the petitioner should have availed of the remedy of appeal and could not approach this court by way of writ petition. 13. The question of law which emerges for determination in these proceedings is whether the notice issued for reassessment in December 2008 would be within the period of limitation as provided by section 11A or section 21 of the Act. It would, thus, be necessary to examine the provisions of section 11A of the Act, which deals with the subject of reassessment and the same reads as under: "11A Reassessment of the tax.-(1) If in consequence of definite information which has come into his possessio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d, namely, (i) there was under-assessment; and (ii) some turnover has escaped the assessment. On this score the assessing authority was denuded of its jurisdiction to issue any notice in December 2008 after a period of over seven years and eight months. If the period of first assessment year for which reassessment is sought to be made is taken to be March 31, 1995 then the assessment has been sought to be reopened after 13 years and in respect of the next assessment year after 12 years and onwards. It is a clear case where the assessment is sought to be reopened long after a period of five years. 15. Even when we examine the provisions of section 21 of the Act which permit exercise of revisional jurisdiction by the Commissioner or any other officer who is clothed with such power conferred by the Government by issuance of valid notification, still there is no escape from the conclusion that even revisional jurisdiction could not have been exercised. Section 21 of the Act is set out below for ready reference: "21. Revision.-(1) The Commissioner may of his own motion call for the record of any proceedings which are pending before, or have been disposed of by any authority subordinat....