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2022 (8) TMI 416
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....axes, Government of Tripura in the purported exercise of powers under Section 85 of the Tripura Value Added Tax Act, 2004 delegating the powers of the Commissioner of Taxes under Section 31 of the Act to all the Superintendent of taxes posted in Tax Audit Cell to be exercised within the State of Tripura with effect from 31.03.2018. (iv) Notice No. F(1)/ST/TAX/AUDIT/UDP/2018/2723-24 dated 04.04.2018 issued by the Superintendent of Taxes, Tax Audit Cell, HQ, Gurkhabasti, Agartala in purported exercise of powers under section 31(1) of the Tripura VAT Act, 2004 directing the petitioner to produce or cause to be produced the accounts and documents relating to the turnover of sales and/or purchase for the period from 2013-2014 to 2017-2018 for scrutiny of the returns furnished by the petitioner. (v) Notice No.F(1)/ST/TAX/AUDIT/UDP/2018/2083 dated 22.02.2019 issued by the Superintendent of Taxes, Tax Audit Cell, HQ, Gurkhabasti, Agartala directing the petitioner to submit the segregated accounts of opening stock, closing stock, fright charge, import fee, bid money etc, in respect of imported and domestic goods for assessment years 2013-14 to 2016-17 for assessment. ....
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.... of powers under Section 31 of the Tripura VAT Act, 2004 and the Notices of Demand issued in pursuance thereof. (xi) Legality and validity of proviso to Rule 20 of the Tripura VAT Rules, 2005 providing for deposit of 90% of the tax payable for the month or quarter ending on 31st March of a year within 31st March itself. [2] The facts of the case are that the petitioner is carrying on the business of bonded ware house in the name & style of M/s Udaipur Bonded Ware House, Udaipur, Gomati, Tripura under a valid license issued by the Competent Authority under the Tripura Excise Act 1987 & Rules made under. Petitioner also has a valid registration TIN 16111128003 issued under Tripura VAT Act 2004. The nature of business of the petitioner is to purchase goods from local and also from various parts of India by duly paying taxes as applicable like Sales Tax, Excise Duties etc. [3] The respondent No.3 the Commissioner of Taxes, Government of Tripura has delegated respondent No.4, the Superintendent of Taxes, Agartala the powers including power of assessment under Section 31 of Assam VAT Act 2004 which has been adopted by State of Tripura under Section 85 of Tripura VAT Act vi....
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....l and they shall exercise the powers to entire state of Tripura. This shall take effect from 31st March, 2018. (Nagesh Kumar, B, IAS) Commissioner of Taxes Government of Tripura Copy to :- 1. The Manager, Tripura Government Press, Bordowali, Agartala with request to publish the above Notification in the extra-ordinary issue of Tripura Gazette, 10 (ten) copies of the above Notification may please be sent to the Commissioner of Taxes, Tripura. 2. The Additional Commissioner of Taxes, Agartala for information. 3. The Asstt. Commissioner of Taxes, Agartala for information. 4. The Superintendent of Taxes, Charge-I/II/III/IV/V/VI/VII/VII/VIII/Tax Audit Cell/ Agartala Enforcement Wing/Udaipur Enforcement Wing/Choraibari Enforcement Wing/Udaipur/Belonia/Ambassa/Teliamura/Bishalgarh/Dharmanagar/Kailashar. 5. Statistical Section/General Section/Establishment Section/Guard File. (Nagesh Kumar, B, IAS) Commissioner of Taxes Government of Tripura [4] In pursuance of the powers delegated, the respondents No.5 for assessment year 2013-14 to 2016-17 issued demand notices in terms of the assessment orders dated 30.0....
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....nt No5 without considering the reply of the petitioner has drawn an adverse inference against the petitioner and has invoked power under Section 31(5), 25(1)(c) Rule 20 and levied taxes, interest & penalty. The assessment order dated 30.03.2019 issued by the respondent No.5 are also under challenge along with the notification dated 04.06.2018 stated supra. The main point which falls for consideration is this lis is the point of jurisdiction. That the respondent No.3 cannot delegate the powers upon respondent No.5 and the action taken by respondent No.5 is not in consonance with the Act & Rules. [7] Hence, this writ petition. [8] The Counter affidavit and written argument have been filed on behalf of the respondents wherein contending that no fundamental right of the petition has been violated, writ is not maintainable as no cause of action is made out, the impugned orders are appealable under Section 69 of the Act before Appellate Authority and a revision under Section 72 before High Court. Further, contended that respondent No.3 is having power under Section 85 to delegate to persons appointed under Section 18(1) of the Act. The audit wing is delinked with tax collection win....
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....d in chapter XX of the Act which includes Section 263 that confers suo motu power of revision on the learned CIT. The different shades of power conferred on different authorities under the Act has to be exercised within the areas specifically delineated by the Act and the exercise of power under one provision cannot trench upon the powers available under another provision of the Act......." [13] In another judgment by apex court in The Barium Chemicals Limited vs. The Company Law Board, reported in AIR 1967 SC 295 held as under: Delegatus Non Potest Delegare means that a delegate has no power to delegate. The said maxim indicates a rule of construction of a statute or other instrument conferring an authority. Ordinarily, a discretion conferred by a statute on instrument conferring an authority. Ordinarily, a discretion conferred by a statute on any authority in intended to be exercised by that authority, and by no other. But the intention may be negative by any contrary indication in the language, scope or object of the Statute. [14] In Mohd Naved vs. State of Uttarakhand & Ors reported in 2020 SCC Online Utt 236 with regard to power of delegation in paragraph 38 hel....
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.... After completion of tax audit of any dealer under sub-section (3), the officer authorised to conduct such audit shall, within seven days from the date of completion of the audit, submit the audit report, to be called "Audit Visit Report" to the assessing authority in the prescribed form along with the statements recorded and documents obtained evidencing suppression of purchases or sales, or both, erroneous claims of deductions including input tax credit and evasion of tax, if any, relevant for the purpose of investigation, assessment or such other purposes. 16. Thus, under the OVAT Act the officer undertaking the audit has to forward the report to the assessing officer who then, in terms of Section 42 of the OVAT Act, makes an "audit assessment. The position under Section 58 of the DVAT Act is very different." [17] Reliance has also been placed on another judgment of the apex court in Kerala Trade Links, Adichira vs. Commercial Tax Officer and Ors (order passed on 05.02.2009) where the apex court has observed that the contention of counsel for the appellant that the Audit officer's main function is to make audit assessment under Section 24 is certainly correct. Howeve....
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....axes. Gazette: Gazette generally means the official Gazette, published under the authority of the Government. Official Gazette: The words OFFICIAL GAZETTE refer to the official Gazette of the State which enunciates the scheme and not to the Central Govt. Gazette. NOTIFICATION: means a notification published by authority of the local Government in the official Gazette, Pun. Act XVII of 1887 (Land Revenue), S.3, Cl. 15. Superintendent of Taxes: Superintendent of Taxes means (in respect of dealer a Superintendent of Taxes referred to in Rule 8 or) any person appointed as such by the State Government under Section 18 and within whose jurisdiction the dealer‟s place of business is situated or if the dealer has more than one such place, the Superintendent within whose jurisdiction the general branch or Head office in Tripura of such business is situated, or if the dealer has no place of business within the State of Tripura, the Superintendent who has been so notified by the Commissioner under Rule. 8. Section 18. (1) The State Government may, for carrying out the purposes of this Act, appoint a Commissioner of Taxes, and such other perso....
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....erest payable by the dealer during such period. (2) If any mistake is detected as a result of such scrutiny made as per the provisions of sub-section (1), the Commissioner of Taxes shall serve a notice in the prescribed form on the dealer to make payment of the extra amount of tax along with the interest as per the provisions of this Act, if it is payable, by a date specified in the said notice. Section 28. Tax audit:- (1) The Commissioner or any other tax officer as directed by him shall undertake tax audit of the records, stock in trade and the related documents of the dealer who are selected by the Commissioner in the manner as may be prescribed for the purpose. Provided that the audit wing shall be delinked from tax collection wing as may be prescribed. (2) The tax audit shall be generally taken up in the office, business premises or warehouse of the dealer. (3) For the purpose of tax audit under sub-section (1) the Commissioner or any other tax officer directed by him shall examine the correctness of return or returns filed and admissibility of various claims including input tax credit. Section 29. Self assessment :- (1)... ....
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....e been provisionally assessed under section 30, serve on such dealer in the prescribed manner a notice requiring him to appear on a date and place specified therein, which may be in the business premises or at a place specified in the notice, to either attend andproduce or cause to be produced the books of account and all evidence on which the dealer relies in support of his returns including tax invoice, if any, or to produce such evidence as specified in the notice. (2) The dealer shall provide all cooperation and assistance to the Commissioner to conduct the proceedings under this section at his business premises. (3) If proceedings under this section are to be conducted at the business premises of the dealer and it is found that the dealer or his authorized representative is not available or not functioning from such premises, the Commissioner shall assess to the best of his judgement the amount of tax due from him. (4) If the Commissioner, after considering all the evidences produced in course of the proceedings or collected by him, is satisfied that any dealer - (a) has not furnished return in respect of any period by the prescribed date; o....
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....the period covered under the return along with the amount of penalty or interest or both payable by him under section 24 and shall furnish a receipt from the Treasury showing the payment of such amount. (3) A registered dealer furnishing a revised return in accordance with the sub-section (3) of section 24, which shows that a greater amount of tax is due than was paid or payable in accordance with the original return, shall furnish along with the return a receipt showing payment of the differential amount in the manner provided in sub-section (2). (4) (a) The amount of tax - (i) due where returns have been filed without full payment of tax due; or (ii) assessed under section 29, section 30 and section 31 less the sum already paid in respect of such period together with interest, if any, required to be paid and the penalty, if any, imposed to be paid under sub-section (5) of section 31 or subsection (2) of section 32. (b) the amount of penalty imposed under any provision of this Act not covered under sub-chause ii) of clause (a); or (c) any other dues under this Act. shall be paid by the dealer into Government Treasury by such date as spe....
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..... (vii) Any other person appointed as such by the State Government. (2) Subject to the provisions of the Act and the Rules made there under, the Commissioner, may, by notification in the official Gazettee, delegate the powers to be exercised by above classes of officers and shall specify the area of the person in respect of which powers are to be exercised by each of the above class of officers. Provided that the power of revision conferred upon the Commissioner under Section 70 of the Act shall not be delegated. Amendment in proviso to sub-rule (2) of Rule 8: The existing proviso to sub-rule (2) of Rule 8 of the Tripura Value Added Tax Rules, 2005 shall be substituted by the following proviso: "Provided that the power of revision conferred upon him under sub-section (2) of Section 70 of the Act, the Commissioner, may, by notification in the Official Gazette, and with the approval of Secretary, in-charge of Finance Department in the Government delegate the power to be exercised by any officer not below the rank of Joint Commissioner of Taxes with certain terms, and he may alter or withdraw such power delegated to any such office....
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....e imposed by the Commissioner in delegating the powers. [19] The notification dated 01.04.2006 and in continuation another notification dated 04.06.2018 both have been issued by the third respondent under Section 85 of the Act. A fair reading of Section 85 of the Act specifically indicates the commissioner may subject to the such restriction and conditions as may be prescribed, delegate, by notification in the official gazette, any of his powers under this act to any person appointed under sub-section (1) of Section 18 to assist him has not been complied with in its true letter and spirit. [20] The respondents have not placed any official gazette to show that the said notifications have been gazatted as contemplated under Section 85 of the Act. The counter affidavit is also silent about such Gazette Notification. In the absence of which, this court has no hesitation to draw an inference that the requirement under Section 85 has not been complied with. Hence, the notification under challenge is invalid. [21] A fair understanding in taxation law as (a) audit (b) assessment (c) demand/recovery/collection are three different stages and are dealt by different and competent auth....