2021 (3) TMI 960

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....ere taxable and qualified for exemption also and during the year, the writ applicants reduced input tax credit to the extent of Rs. 28,01,137/- in accordance with the provisions of Section 11 of the VAT Act and the same was reflected in its self assessed annual return for A.Y. 2011-12. The respondent authorities had made the final assessment order dated 30.05.2015 for the year 2011-12 and had reduced credit upto Rs. 26,39,914/- and made the refund to the tune of Rs. 58,244/- after adjusting access input tax credit against the Central Tax Sales Dues assessed under the Central Sales Tax Act, 1956 and the assessment order dated 30.05.2015 was finalized without any scrutiny proceedings as provided under Section 35 (turnover escaping assessment) and Section 75 (revision of the Vat Act). 2.3 In the aforesaid background, it is the case of the writ applicants that, the final audit assessment order under Section 34 of the VAT Act was passed by the respondent authorities within the limitation period and accordingly, the refund was assessed after reducing input tax credit on account of use of taxable material and exempted goods for the inter-state sale of goods. 2.4 It is th....

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....e final assessment order and therefore, the respondent No.2 could not have reopened the assessment proceedings by virtue of invoking the provision of Section 34(8A) of the VAT Act. In view of the factual aspects of the case, he further submitted that, the present case does not fall under any eventualities prescribed under Section 34 (8A) of the Act and therefore, recalculation of the credit amount by invoking powers under Section 34 (8A) of the Act is without jurisdiction. 6. Mr. Kuntal Parikh relying on the decision of this Court in the case of Dhanani Imp. Exp. Pvt. Ltd. Vs. State of Gujarat [SCA/9519 & 9520/2016, decided on 21.07.2016], contended that, the issue involved in the present application is squarely covered by the judgment of the Division Bench of this Court, wherein, it was held that, the pendency of proceedings would be sine qua non for exercise of power for invoking Section 34(8A) of the Act and accordingly, the impugned order passed by the authority having been quashed and set aside. 7. In view of the aforesaid submissions, Mr. Parikh, the learned counsel appearing for the writ applicants submitted that, the action of the respondent is in excess of jurisdicti....

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....that a dealer who has been liable to pay tax has failed to get himself registered with the Commissioner. Sub section (8A) was introduced in section 34 with effect from 01.04.2013 and reads as under: (8A) (a) During the course of any proceedings under this Act, if the prescribed authority is satisfied that the tax has been evaded or sought to be evaded or the tax liability has not been disclosed correctly or excess tax credit has been claimed by any dealer in respect of any period or periods by not recording or recording in an incorrect manner, any transaction of sale or purchase, or that any claim has been incorrectly made, then in such a case notwithstanding any notice for assessment has been issued under other provisions of this section or any other section of this Act. The prescribed authority may, after giving such dealer a reasonable opportunity of being heard, initiate assessment of the dealer in respect of such transaction or claim: Provided that where such proceedings are under section 73 or section 75, the prescribed authority shall transfer the proceedings relating to such transaction or claim directing the concerned assessing authority to assess the dea....

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....ortunity to the dealer and making an inquiry, if found necessary, proceed to the best of his judgment the amount of tax due to the dealer in respect of such turnover. Subsection (2) of section 35 provides that no order under subsection (1) shall be made after the expiry of 5 years from the end of the year in which or part of which the tax is 10. It can thus, be seen that detailed provisions are be made in chapter-V of the VAT Act for dealers to file returns and for the prescribed authorities to assess such returns and thereby compute the dealers' correct tax liability. The VAT Act also contains detailed provisions for appeal and revisions against such orders of assessment. Subsection (8A) of section 34 therefore needs to be seen in background of such statutory provisions, particularly, bearing in mind facts of the case. 11. Facts of the case are that by the time the respondents issued notice for revising the tax of the petitioner under subsection (8A) of section 34, the original assessment was already completed in February 2010. In any case, in terms of subsection (9) of section 34, such assessment became time barred by 31.03.2011. In terms of subsection (1) of section....