AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (8) TMI 776
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.... this petition under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs. "(B) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or any other appropriate writ, order or direction quashing and setting aside the Assessment Order in Form No. 304 dated 14.11.2009 passed by the Ld. Respondent No. 2; (C) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or any other appropriate writ, order or direction quashing and setting aside the Notice for Amount Assessed in Form No. 305 dated 14.11.2009 issued by the Ld. Respondent No. 2." 5. Brief facts of the case are as under. 5.1 The petitioner is a registered partnership firm in the business of executing civil and labour contracts which is a government approved contractor executing government and semi-government contracts. The petitioner is also a registered dealer under the provisions of the Act. The present Petition concerns the assessment period 2014-15. 5.2 The petitioner, during the period under consideration, had filed its annual self-assessment returns under Section 33 of the Gujarat Value Added Tax Act, 2003 (for short 'the Act') in the prescribed form.....
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....er queries were raised by the respondent authority and even no documents were asked from the petitioner. 5.7 The intimation dated 06th March, 2019 had not provided opportunity to explaining as to why cost plus gross profit method be not adopted or the deductions claimed and allowable as per Section 2 (30) (c) of the Act be not disallowed while arriving at taxable turnover of sales nor the notice in Form No.309 provides reasons to believe for imposing the penalty on the petitioner. 5.8 The petitioner was represented by its legal representative at the hearing that took place on 13th March, 2019 along with all the supporting documents, which was just an empty formality by the respondent authority and no opportunity worth the name was given to the petitioner to explain as to why the method adopted or the deductions claimed for arriving at taxable turnover of sales be not disallowed. 5.9 The respondent authority passed the assessment order dated 24th March, 2019 making huge addition raising exorbitant dues of Rs. 25,08,46,582/- inclusive of interest and penalty and that too without recording any reasons for making high-pitched assessment. The respondent authority has passed the....
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....rt and no finding is recorded in this regard. 7.1 It was further submitted that assuming that provision of Section 2 (30) (c) of the Gujarat Value Added Tax Act, 2003 applies, petitioner has not been put to notice as to why the audit report is not acceptable and only part amount is given as deduction. 7.2 Learned senior advocate for the petitioner submitted that even if the turnover was computed as per Section 2 (30) (c) of the Act, labour and other incidental expenses are required to be deducted to arrive at a taxable turnover and the respondent No. 2 allowed deduction only to the tune of Rs. 86,70,45,999/- instead of Rs. 119,25,44,538/- without assigning any reason for rejecting the deduction to the tune of Rs. 32,54,98,539/- as claimed by the petitioner. 7.3 Learned senior advocate further submitted that the respondent ought to have taken into consideration the decision of the Apex Court in the case of Gannon Dunkerly & Co. v. State of Rajasthan reported in (1993) 1 SCC 364, which was directed to be followed by this Court while disposing of the earlier round of litigation in Special Civil Application No. 13971 of 2019. 8. Learned Assistant Government Pleader submitte....
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.... f. Thereafter, on 04.11.2019 the Authorised Representative of the Petitioners submitted certain sublet works contract details but could not submit supporting document evidencing the expenses undertaken by of Works the Contract Petitioners themselves. It is further submitted that it was informed to the answering Respondent herein that since the data is bulky the answering Respondents may visit the Place of business of the petitioners and access the relevant data. g. Therefore, on 05.11.2019 only after visiting the place of business of the Petitioners and upon due verification of the necessary data, the deductions were made as per the judgment of the Hon'ble Supreme Court in the case Gannon Dunkerly (supera) to arrive at the taxable turnover." 8.1 It was submitted that the impugned order passed by the respondent No. 2 raising demand of Rs.15,97,640/- is therefore justified and the arguments of the petitioner that hearing was not provided prior to passing of the impugned order is erroneous and incorrect. 8.2 It was further submitted that the impugned notice for penalty in Form No.309 was issued under Section 34 (12) of the Act which provides that for levy of pe....
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...., semi-government and other such entities. It appears that the writ applicant has been consistently following a method of accounting wherein the material used in the contract is marked-up with the gross profit to quantify the deemed sale and on the said deemed sale the tax is worked out at the applicable rate. As against this tax liability, the input tax credit which is available on the purchases and TDS under Section 59B would be reduced so as to work out the net tax liability. It appears from the materials on record that such method of accounting was accepted by the department till the recent past and the assessments for the earlier years were also framed accepting such method. The decision of the Supreme Court in the case of Gannon Dunkerly and Co. and Ors. vs. State of Rajasthan and Ors. Reported in (1993) 1 SCC 364 was also relied upon before the respondent No. 2. Unfortunately, this decision has not been dealt with even remotely. According to the dictum as laid in the said decision, the allowable expenditure as the audited account as quantified in the statement needs to be reduced from the gross receipts. 6.2 It appears that the respondent No. 2 has not considered th....