TaxTMI 
TaxTMI 
2018 (3) TMI 1416
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....re P-8 dated 26-12-2016 under Section 22(1) of the Chhattisgarh Valued Added Tax Act, 2005 (for short, 'the VAT Act'). 3. The short question of law involved in the batch of writ petitions is, whether in absence of any assessment order passed in the original proceeding under Section 21(7) of the VAT Act, the assessing officer has power and jurisdiction to reassess the said deemed reassessment by resorting to reassessment proceeding under Section 22(1) of the VAT Act and further the consequential question would be, whether in that case, the assessing officer is justified in levying penalty under Section 22(2) of the VAT Act. 4. To unlock the questions so posed for consideration, the essential facts need to be noticed herein. 5. The petitioner herein being the registered dealer under the VAT Act submitted its return for the years 2010-11, 2011-12 and 2012-13 in accordance with the provisions of the said Act and also submitted audit report and statutory compliances along with list of purchases as required. The original assessment proceedings were initiated by issuance of notice on 12-5-2014 and thereafter the matter was heard on 15-1-2015, 16-1-2015, 19-1-2015, 28-1-2015 and....
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....ficacious and alternative remedy, would submit that the petition challenging the order of reassessment at the very threshold is maintainable in view of the judgment of the Supreme Court in the matter of Calcutta Discount Co. Ltd. v. Income-Tax Officer, Companies District I, Calcutta AIR 1961 SC 372. The order challenging final reassessment can also be challenged in a writ proceeding, as the order passed is without jurisdiction and without authority of law. On the merit of the matter, he would submit that there is no order of assessment passed in the original proceeding despite having been heard by the assessing officer and therefore there is deemed assessment under Section 21(2) of the VAT Act and that reassessment can be reopened only under Section 21(2). Resorting to reassessment proceeding under Section 22(1) is not permissible since the jurisdiction under Section 22(1) can be acquired by the assessing officer where an assessment or reassessment of dealer has been made and consequently the order imposing tax and penalty is vulnerable and deserves to be quashed. 9. Mr. Gary Mukhopadhyay, learned Government Advocate appearing for the State/respondents, would submit that the order....
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....ide a notice issued under Section 147 of the Income Tax Act, 1961, if the conditions precedent to the exercise of jurisdiction under Section 147 of the Act do not exist, and observed as under: - "6. The High Court exercising jurisdiction under Article 226 of the Constitution has power to set aside a notice issued under Section 147 of the Income Tax Act, 1961, if the condition precedent to the exercise of the jurisdiction does not exist. The Court may, in exercise of its powers, ascertain whether the Income Tax Officer had in his possession any information: the Court may also determine whether from that information the Income Tax Officer may have reason to believe that income chargeable to tax had escaped assessment. But the jurisdiction of the Court extends no further. Whether on the information in his possession he should commence a proceeding for assessment or reassessment, must be decided by the Income Tax Officer and not by the High Court. The Income Tax Officer alone is entrusted with the power to administer the Act: if he has information from which it may be said, prima facie, that he had reason to believe that income chargeable to tax had escaped assessment, it is not open....
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....d Jeans Knit Private Ltd. (supra) and considering the facts leading to challenge to the order of reassessment , I do not have any slightest doubt in my mind to hold that the writ petition is maintainable to challenge the order of reassessment under Section 22(1) of the VAT Act and accordingly, I overrule the first preliminary objection raised on behalf of the respondents in that regard. 17. This would bring me to the merit of the matter to consider the question framed, whether in absence of assessment order passed in original assessment proceeding and in case of deemed assessment under Section 21(2) of the VAT Act, the assessing officer has power and jurisdiction to reassess by invoking Section 22(1) of the VAT Act and levy penalty under Section 22(2) of the VAT Act. 18. In order to answer the plea raised at the Bar, it would be appropriate to notice Sections 21(2) and 21(3) of the VAT Act which state as under: - "Section 21 : Assessment of tax (1) xxx xxx xxx (2) Where a registered dealer other than the registered dealer referred to in the proviso to sub-section (1) has furnished,- (i) all the returns for a year and/or; (ii) revised return for any quarter or quarters o....
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.... Where an assessment or re-assessment of a dealer has been made under this Act or the Act repealed by this Act and for any reason any sale or purchase of goods liable to tax under this Act or the Act repealed by this Act during any period,- (a) has been under assessed or has escaped assessment, or (b) has been assessed at a lower rate, or (c) any wrong deduction has been made while making the assessment, or (d) a rebate of input tax has incorrectly been allowed while making the assessment, or (e) is rendered erroneous and prejudicial to the interest of revenue consequent to or in the light of any judgment or order of any Court or Tribunal which has become final, the commissioner may, at any time within a period of five calendar years from the date of order of assessment or from the date of judgment or order of any court or tribunal, proceed in such manner as may be prescribed, to assess or re-assess, as the case may be the tax payable by such dealer after making such enquiry as he considers necessary, and assess or re-assess to tax. (2) The commissioner shall, where the omission leading to assessment or reassessment made under sub-section (1) is attributable to the de....
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....istinguished, owing to the different consequences flowing from them, not only in the matter of enforcement and appeal but in other respects, as, for instance, the time within which proceedings to annul them must be taken. Rulings on motions are ordinarily orders rather than judgments. The class of judgments and of decrees formerly called interlocutory is included in the definition given in [modern codes] of the word 'order.' " 1. A.C. Freeman, A Treatise of the Law of Judgments § 19, at 28 (Edward W. Tuttle ed., 5th ed. 1925)." 23. Thus, "order of assessment" employed in Section 22(1) of the VAT Act clearly denotes that there must be formal adjudication by the assessing officer after taking into account the return and statutory compliances and the documents furnished by the petitioner. 24. In order to attract Section 22(1) of the VAT Act, there must be order of assessment made by the assessing officer in contradistinction to Section 21(2) which is a deemed assessment and which in case of the petitioner, it has been done is a legal fiction. 25. The legislature is quite competent to create a legal fiction, in other words, to enact a deeming provision for the purpose o....
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....look to the object which the statute seeks to achieve while interpreting any of the provisions of the Act. A purposive approach for interpreting the Act is necessary." 31. Their Lordships of the Supreme Court in the matter of Jugalkishore Saraf v. Raw Cotton Co. Ltd. AIR 1955 SC 376 stated as under:- "6. ... The cardinal rule of construction of statutes is to read the statute literally, that is by giving to the words used by the legislature their ordinary, natural and grammatical meaning. If, however, such a reading leads to absurdity and the words are susceptible of another meaning the court may adopt the same. But if no such alternative construction is possible, the court must adopt the ordinary rule of literal interpretation." 32. The Supreme Court in J.K. Cotton Spinning & Weaving Mills Ltd. (supra) held as under:- "It is well settled that a deeming provision is an admission of the non-existence of the fact deemed. Therefore, in view of the deeming provisions under Explanations to Rules 9 and 49, although the goods which are produced or manufactured at an intermediate stage and, thereafter, consumed or utilized in the integrated process for the manufacture of another comm....
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....ppeal upheld the assessments. The Board of Revenue, in second appeal, reversed the finding of the first appellate authority and the High Court upheld its view. The High Court analysed the provisions of section 19(1) and emphasised that the power of re-opening under that provision could be exercised only where an assessment had been made. No assessments for the relevant assessment years having been made, it held that the provisions of section 19 were inapplicable. 3. The notices and subsequent proceedings under section 19 are not on the record before us, but it is clear from what has been stated by the Board and by the High Court that the assessments that are under challenge were made upon the strength of the provisions of section 19 of the State Act. The relevant portion of section 19 reads thus: "Where an assessment has been made under this Act or any Act repealed by section 52 and if for any reason any sale or purchase of goods chargeable to tax under this Act or any Act repealed by section 52 during any period has been under-assessed or has escaped assessment or assessed at a lower rate or any deduction has been wrongly made therefrom, the Commissioner may, at any time withi....