TaxTMI 
TaxTMI 
2024 (8) TMI 4
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.... the provisions of Section 28A of the Haryana General Sales Tax Act, 1973, it is not necessary for the Assessing Authority to issue the notice for best judgement assessment under section 28 (4) of the Act within the period of five years?" 3. The brief facts which are necessary to have a hang over the issue involved are hereby noticed. The applicant-assessee-Food Corporation of India (for short-'FCI') is a Central Government Undertaking which is engaged in the procurement and distribution of foodgrain across the country. It was registered in the State of Haryana under 1973 Act as well as Central Sales Tax Act, 1956. FCI filed its quarterly returns during the financial years 1977-78 and 1978-79. It disclosed its turnover Rs. 59,16,20,598.48/- for the year 1978-79. The Assessing Authority, in terms of Sections 28 of 1973 Act, issued notice dated 02.06.1986 for the assessment of financial year 1978-79 whereby FCI was directed to appear before Assessing Authority on 20.06.1986. 4. The FCI filed its objection dated 17.06.1986 stating that notice is barred by limitation so the same be withdrawn. The Assessing Authority framed ex-parte assessment vide order dated 28.11.1986 whereby decl....
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.... non-obstante clause. The full effect shall be given to non-obstante clause. As per judgment of Supreme Court in Indian Aluminium Cables Limited and another vs. The Excise and Taxation Officer and another (1977) 1 Supreme Court Cases 120, if legislature has not prescribed limitation period, the concept of reasonable period cannot be imported. Section 36 of 1973 Act does not come to rescue of the applicant-dealer because best judgment assessment is framed without books of account. The period of five years prescribed under Section 36 of 1973 Act to maintain books of account is applicable where assessment is made on the basis of books of account produced by dealer. In Madan Lal Arora vs. The Excise and Taxation Officer, Amritsar 1961 SCC OnLine SC 113, Supreme Court has considered Section 11 (4) of Punjab General Sales Tax Act, 1948 (for short '1948 Act') and observed that authority could proceed to make best judgment assessment within three years. 9. We have heard counsel for the parties and perused the records with their able assistance. 10. The question of law to be answered centres around reading of Sections 28 and 28A of 1973 Act which are reproduced hereunder:- "28. Assessme....
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....ficate to make purchases of such goods without payment of tax to the selling registered dealer, be entitled to get the amount of sales tax so paid to be adjusted against his liability to pay tax. 28A. Dispensing with the second notice, etc. Notwithstanding anything to the contrary contained in this Act or any other law or judgment or order of any court or any authority, in respect of cases relating to assessment for the period prior to the First April, 1979, - (i) no second notice shall be required to be issued. (a) under sub-section (4) or (5) of section 28; (b) under sub-section (4) or (5) of section 11 of the Punjab General Sales Tax Act, 1948 and (ii) it shall not be necessary, to intimate the basis for arriving at best of judgment assessment or to take any other step for proceeding to assess to the best of judgement within the period of five years as specified in the provisions mentioned in sub-clauses (a) and (b) above." [Emphasis supplied] 11. Section 28 prescribes procedure of assessment to be framed by Assessing Authority. As per 1973 Act, every dealer has to file quarterly returns which are followed by annual return. If the Assessing Officer finds that ....
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....d attempted to cure by way of Section 28A of 1973 Act. A three judge bench of Supreme Court in Indian Aluminium Cables Limited (supra) considered the procedure to be followed by an Assessing Authority while framing best judgment assessment. Section 28 of 1973 Act was para materia with Section 11 (4) of 1948 Act. While interpreting Section 11 (4) of 1948 Act, the Supreme Court held that in case, assessee having furnished a return fails to comply with terms of a notice issued under sub-section (2), the Assessing Authority has to take some effective steps such as issuance of a notice to the dealer intimating to him that he is proceeding to assess to the best of his judgment. He has to further give to the dealer a reasonable opportunity of being heard. The relevant extracts of the judgment are reproduced hereunder:- "7. Sub-section (4) of Section 11 is attracted in a case where a dealer having furnished a return in respect of a period fails to comply with the terms of a notice issued under sub-section (2). In such a case the assessing authority has to take some effective step, such as issuance of a notice to the assessee intimating to him that he is proceeding to assess to the best o....
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.... terms of a notice issued under sub-section (2) the assessing authority may be in a position to complete the assessment under sub-section (3), treating the alleged failure of the dealer as not a real failure on his part." [emphasis supplied] 13. The aforesaid judgment was delivered on 23.09.1976 and Section 28A of 1973 Act came to be inserted by Act No. 5 of 1982. The said Section is applicable only to assessments relating to the period prior to 01.04.1979 meaning thereby rigour of Section 28A of 1973 Act is not applicable to the assessments for the period from 01.04.1979 onwards. 14. Section 28 (4) of 1973 Act provides that if a dealer having furnished returns in respect of a period, fails to comply with the terms of a notice issued under sub-section (2), the Assessing Authority shall within five years, proceed to assess to the best of his judgment. Section 28 (4) of 1973 Act carries following ingredients:- (i) The dealer must have furnished returns for the period in question; (ii) The Assessing Authority must issue a notice under sub-section (2). The said notice should be in the prescribed manner and require the dealer to produce evidence, on a specified date and place,....
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.... Section 28A of 1973 Act is having overriding effect and all other provisions of the 1973 Act which are contrary to Section 28A need to be ignored. The opening line of Section 28A makes it clear that if anything in the Act is contrary to Section 28A, should be ignored. The Revenue has attempted to say that period of five years prescribed under Section 28 (4) of 1973 Act is contrary to mandate of Section 28A, thus, it should be ignored. We are in agreement with Revenue that anything contrary to Section 28A of 1973 Act should be ignored but it is necessary to find out whether period prescribed under Section 28 (4) of 1973 Act is contrary to Section 28A or it is in consonance with Section 28A of 1973 Act. 18. There are two clauses of Section 28A of 1973 Act i.e. Clause (i) and (ii). Clause (i) provides that no second notice shall be required to be issued under sub-sections (4) and (5) of Section 28 of 1973 Act. Section 28 (4) of 1973 Act does not provide for second notice. The requirement of second notice arose because of law laid down by Supreme Court in Indian Aluminium Cables Limited (supra). It was the judgment of Supreme Court which created requirement of second notice whereas s....
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....her step, without intimating basis for arriving at best of judgment assessment, however, Assessing Authority is bound to proceed within the period of five years which has been specified under Section 28 (4) of 1973 Act. The aforesaid clause is not mandating that it shall not be necessary to proceed within five years as specified in Section 28 (4) of 1973 Act. Section 28A of 1973 Act has dispensed with requirement of second notice, opportunity of hearing, disclosure of basis for arriving at best of judgment assessment, however, it has not dispensed with requirement of proceeding within five years period as prescribed under Section 28 (4) of 1973 Act. Any other reading would amount to violence to aforesaid Section. The language of Section is clear and unambiguous. The intent and purport of legislature to insert aforesaid Section was to dispense with requirement of second notice as well as opportunity of hearing. There was no intention of legislature to dispense with requirement to proceed within five years period as prescribed under Section 28 (4) of 1973 Act. If contention of State is accepted, it would amount to substitution of word "for" used in between the words "step" and "proce....