TaxTMI 
TaxTMI 
2021 (2) TMI 511
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.....2020 and 18.11.2020 seeking recovery of such tax. The petitioner has also further challenged orders dated 10.12.2020 again passed by the said authority imposing penalty on the petitioner in terms of Section 75A of the TVAT Act. [2] These petitions relate to the assessment period 2010-11, 2011-12 and 2012-13. For further details, we may refer to the facts in W.P(C) No.847 of 2020 which are as under: The petitioner is an individual engaged in the business of providing bonded ware houses in the name and style of Udaipur Bonded Warehouse situated within the State of Tripura. The petitioner is a registered dealer under the TVAT Act. For the assessment period 2011-12 the petitioner had filed a return of its taxable turnover in terms of the TVAT Act and according to the petitioner, necessary tax was also paid as per such declared taxable turnover. The revenue however, was not entirely satisfied about the taxes paid by the petitioner for the said assessment period. The Superintendent of Taxes therefore, had issued a notice dated 11.02.2018 under Section 27 (2) of the TVAT Act calling upon the petitioner to show cause why short payment of tax should not be recovered with interest. Th....
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....t tax credit claimed therein and full payment of tax and interest payable by the dealer during such period. Sub-section (2) of Section 27 provides that if mistake is detected as a result of such scrutiny, the Commissioner of Taxes shall serve a notice in prescribed form on the dealer to make payment of the extra amount of tax along with interest as per the provisions of the Act if payable. 18. Section 27 of the TVAT Act thus is not a provision for full assessment of the return filed in response to the notice issued by the Commissioner under sub-section (2) of Section 24 of the TVAT Act. It is merely for the purpose of verifying the correctness of necessary details furnished in such return such as calculation, application of rate of tax, interest etc. as well as payment of tax and interest by such dealer. If any error is detected in any of these aspects, under subsection (2) of Section 27, the Commissioner would issue a notice of recovery demanding payment of extra tax with interest. These powers are essentially in the nature of prima facie adjustments. 19. The provisions contained in Section 27 of the TVAT Act are vastly different from the provisions for self-asse....
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.... And whereas, interest at the rate of one and half percent per month from the date the tax payable had become due to the date of its payment or to the date of order of assessment, whichever is earlier. As per the returns furnished for the year 2010-11, 2011-12 & 2012 -13 respectively; Now, therefore, the dealer or any person authorized by the dealer is hereby directed to appear before the Superintendent of Taxes, Udaipur, Gomati District at his office of the Superintendent of Taxes at 1st floor, O/O the Superintendent of Excise Office Building, Dakbanglow Road, Udaipur, Gomati Tripura on 11.09.2020 at 11.00 AM along with relevant books of account & documents and any other evidence, for the material year(s), on which the dealer may rely to show cause the following grounds:- (i) As to why balance due VAT amounting to Rs. 5,38,383/-, Rs. 8,05,845/- & Rs. 12,64,761/- shall not be payable by the dealer as per total sales declared in the returns furnished for the year 2010-11,2011-12 & 2012-13 respectively; (ii) As to why interest at the rate of one and half percent per month from the date the tax payable had become due to the date of its payment or to the ....
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....Otherwise the applicant- dealer must seek appropriate relief before the competent court of law against the ill action taken against the applicant-dealer without jurisdiction. Though the matter of the case is a fiscal one yet the Ld. Assessing Authority does not have any prim facie case n or is he entitled to assess the applicant-dealer after expiry of limitation and it's also clear that both the assessing authority and the A.G. Audit made computation with wrong notion and without deducting the 'DISCOUNT' given to the buyers by the applicant-dealer. Hence, it's prayed before the Ld. Assessing authority to withdraw/drop the Notice dated 27.08.2020 within 2(two) days from the date of receipt of this application positively. Otherwise the applicant-dealer seeks appropriate relief before the competent court with contempt of Court against the Ld. Assessing Authority including the power delegated authorities." [5] Undeterred by these oppositions of the petitioner, the Superintendent of Taxes passed the impugned order dated 14.10.2020 in purported exercise of powers under Section 25 of the TVAT Act, relevant portion of which reads as under: "10.5. The proceeding under S....
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....unting to Rs. 5,38,383/-, Rs. 8,05,845/- & Rs. 12,64,761/- for the periods 2010-11, 2011-12 and 2012-13 respectively, which is liable to be paid by the dealer in accordance with the declaration f total sales made by him at Sl. No.(i) in Table 9 of the returns furnished by the dealer for the said periods in question. 14. The dealer is also liable to pay interest at the rate f one and half percent per month under Section 25(1) of the TVAT Act, 2004, from the date of tax payable had become due to the date of payment, on the amount of balance tax due or less paid Rs. 5,38,383/-, Rs. 8,05,845/- & Rs. 12,64,761/- for the periods 2010-11, 2011-12 and 2012-13 respectively.****" [6] Appearing for the petitioner learned Sr. counsel, Sri Saraf submitted that the action of the Superintendent of Taxes is wholly without authority. Section 25 of the TVAT Act would not permit the Superintendent of Taxes to undertake a details scrutiny of the return filed by the petitioner. Such scrutiny assessment can be made only under Sections 31 or 34 of the TVAT Act, both of which come with time limits. In the present case, these assessments have become time barred. The authority in the guise of ex....
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....dgment dated 20.01.2020. It was held that since no notice under Section 24 of the TVAT Act was issued, powers under section 27 of the Act cannot be exercised; (v) After this judgment was delivered, the Superintendent of Taxes issued notice under Section 25 of the TVAT Act and after hearing the petitioner proceeded to pass order of raising tax demands and also imposing penalty. The question is, was the Superintendent of Taxes within his right to do so. To answer this question, we may refer to certain provisions contained in TVAT Act. [10] Chapter-V of the TVAT Act pertains to returns and assessment. Section 24 contained in the said chapter pertains to periodical returns and payment of tax. Sub-section (1) of Section 24 provides that every registered dealer shall furnish return in such forms for such period, by such dates and to such authority as may be prescribed. Sub-section (2) of Section 24 provides that if the Commissioner has reason to believe that the turnover of sales of any dealer has exceeded the taxable limit as provided in sub-section (3) of Section 3, he may by notice served in the prescribed manner, require such dealer to furnish return as if he were a regis....
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....turn in relation to any tax period furnished by a registered dealer in which notice has been issued by the Commissioner under Section 24 shall be subject to scrutiny by the Assessing Authority to verify the correctness of calculation, application of correct rate of tax and interest and input tax credit claimed therein and full payment of tax and interest payable by the dealer during such period. As per sub-section (2) of Section 27 if any mistake is detected as a result of such scrutiny the Commissioner shall serve a notice to the dealer to make payment of the extra amount with interest. [14] Section 29 of the TVAT Act pertains to self assessment and Section 30 pertains to provisional assessment. Section 31 of the TVAT Act pertains to audit assessment and authorizes the Commissioner to carry out scrutiny assessment where a dealer has failed to furnish the return or his case is selected for audit assessment or the Commissioner is not satisfied with the correctness of any return filed under Section 24 or the bonafides of any claim of exemption, deduction, concession, input tax credit or genuineness of any declaration or the Commissioner has reason to believe that detailed scrutiny....
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....have noticed that as per Section 33 of the TVAT Act no assessment under Section 31 i.e. audit assessment can be made after expiry of five years from the end of the tax period in question likewise as per sub-section (2) of Section 34 powers of assessing turnover escaping assessment cannot be exercised after expiry of five years from the end of the year in respect of which or part of which the tax is assessable. [17] It was in this context, while examining the previous exercise of powers by the Assessing Officer under Section 27 of the TVAT Act, this Court had made certain observations, relevant portion of which we have reproduced earlier. Noticing that once the assessing authority had missed the time limit for carrying out audit assessment or for bringing to tax turnover escaping assessment, the powers under Section 27 could not be exercised that too without satisfying the pre condition of a notice under Section 24 having been issued, the action was quashed. It was at this stage that the Assessing Officer once again tried to bring to tax the same element of petitioner's turnover which according to him had escaped assessment. The dispute between the petitioner and the department w....