Research › Search › Judgment

Allahabad High Court · body

2016 DIGILAW 1619 (ALL)

Sony India Pvt. Ltd. v. State of U. P.

2016-04-28

DILIP GUPTA, RAGHVENDRA KUMAR

body2016
JUDGMENT This petition seeks the quashing of the assessment order dated 31 March 2016 passed by the Joint Commissioner (Tax Audit), Commercial Tax, Gautam Budh Nagar in regard to the assessment year 2011-12 under the provisions of the U.P. Value Added Tax Act, 2008 The U.P. Act. and the provisions of the Central Sales Tax Act, 1956 The Central Act. 2. The Assessing Officer had initiated the proceedings under both the aforesaid acts by a notice dated 1 August 2014 and on transfer of the matter a fresh notice on 4 July 2015 was issued. 3. A survey was conducted by Special Investigation Branch of the Commercial Tax Department of the warehouse of the petitioner situated in Greater Noida. Ultimately, the assessment orders dated 11 April 2014 were passed under the aforesaid two acts. However, these were assailed by the petitioner in a writ petition before this Court, which was allowed vide order dated 29 May 2014. Subsequently, a fresh notice dated 25 June 2014 was issued for assessment and thereafter, fresh orders were passed on 30 July 2014. Feeling aggrieved by the said assessment orders, the petitioner filed appeals under Section 55 of the U. P. Act. The First Appellate Authority set aside the assessment orders by order dated 5 February 2015 and remanded the matter back to the Assessing Authority with the direction to provide adequate and meaningful opportunity of hearing to the petitioner and also verify the account books of the petitioner. 4. Consequently, fresh re-assessment proceedings were initiated by the Assessing Authority on 26 June 2015 and a 29 page show cause notice was issued by the Assessing Authority on 29 March 2016, which required it to submit a reply by 30 March 2016. According to the petitioner, the notice dated 26 March 2016 was received by it only on 29 March 2016. The petitioner claims to have submitted a reply on 30 March 2016 that Assessing Authority may grant 3-4 weeks' time to furnish the details as it was not possible to submit an effective reply to the show cause notice within one day. The grievance of the petitioner is that the Assessing Authority did not grant time to file a reply and passed the order on 31 March 2016 as the limitation was to expire on 31 March 2016. 5. The grievance of the petitioner is that the Assessing Authority did not grant time to file a reply and passed the order on 31 March 2016 as the limitation was to expire on 31 March 2016. 5. Sri S. D. Singh, learned Senior Counsel appearing for the petitioner has submitted that it was for the Assessing Authority, particularly when the First Appellate Authority had passed the order on 5 February 2015, to have taken immediate steps for issuance of the show cause notice, but the Authority waited up to 26 March 2015 to issue the notice and in order to meet the deadline just gave 3 days' time to the petitioner to file reply, which in fact was reduced to only one day as the notice was served on it on 29 March 2016. Learned Senior Counsel contended that it was not possible for the petitioner to submit a reply to such a lengthy notice and that too which required the petitioner to furnish details regarding various issues and, therefore, the petitioner was justified in making a prayer for granting 3-4 weeks' time to file a reply, but time was not granted. His contention, therefore, is that the principles of natural justice have been violated, more particularly, when the First Appellate Authority in its order itself had directed the Assessing Authority to grant adequate and meaningful opportunity to the petitioner. Learned Senior Counsel, however, very fairly stated that even though Section 29 (5) of the U. P. Act would enable the Assessing Authority to pass fresh assessment order as limitation would not expire yet the petitioner is ready to make a statement that it will not take the advantage of the limitation if a fresh assessment order is passed after providing adequate opportunity to the petitioner. 6. On 20 April 2016 time was given to Sri C. B. Tripathi, learned counsel appearing for the respondents to seek instructions in the matter. Sri Tripathi has placed before the Court the instructions that have been received. They state that the order passed by the First Appellate Authority dated 5 February 2015 was served on the Assessing Officer on 3 March 2015 and a notice dated 26 July 2015 was issued by the Assessing Authority to the petitioner seeking certain information. Sri Tripathi has placed before the Court the instructions that have been received. They state that the order passed by the First Appellate Authority dated 5 February 2015 was served on the Assessing Officer on 3 March 2015 and a notice dated 26 July 2015 was issued by the Assessing Authority to the petitioner seeking certain information. According to the instructions, the verification part was started on 5 February 2016 and ended on 20 March 2016 and it is thereafter that the show cause notice dated 26 March 2016 was issued to the petitioner requiring it to furnish a reply by 30 March 2016 as the limitation was to expire on 31 March 2016. 7. It is, therefore, clear from the instructions that have been received that the department started the verification on 5 February 2016. It ended on 20 March 2016 and it is only thereafter that the notice dated 26 March 2016 was issued to the petitioner to submit a reply by 30 March 2016. There is no denial of the fact in the instructions that the notice dated 26 March 2016 was served upon the petitioner on 29 March 2016. What follows is that the petitioner was in fact provided only one day's time to file a reply to the notice which is of 29 pages and requires the petitioner to furnish details of the various transactions. The petitioner was entitled to adequate and meaningful opportunity while filing reply to the notice dated 26 March 2016. It is for this reason that the petitioner submitted an application on 30 March 2016 asking for three to four weeks' time to file a reply. The Assessing Authority, however, in order to pass the order within limitation proceeded with the matter and passed the assessment orders both in regard to the U. P. Act and Central Act on 31 March 2016. We have no doubts in our mind that proper opportunity was not provided to the petitioner to file a reply to the notice dated 26 March 2016. It was incumbent upon the Assessing Authority to have provided a reasonable opportunity to the petitioner, more particularly, when the First Appellate Authority had directed the Assessing Officer to grant proper and meaningful opportunity to the petitioner before passing the fresh assessment order. 8. It was incumbent upon the Assessing Authority to have provided a reasonable opportunity to the petitioner, more particularly, when the First Appellate Authority had directed the Assessing Officer to grant proper and meaningful opportunity to the petitioner before passing the fresh assessment order. 8. It is for this reason that we are not inclined to accept the submission of the learned counsel for the respondents that the petitioner should be relegated to the alternative remedy of filing a second appeal under Section 55 (5) of the U. P. Act. 9. Section 29 (5) of the U. P. Act deals with certain contingencies when the Appellate Authority, Revising Authority, Tribunal, High Court, Commissioner or the State Government sets aside an order of assessment or reassessment and is as follows : - "29 (5). Where appellate authority, revising authority, Tribunal, High Court, Commissioner or the State Government has - (a) set aside an order of assessment or re-assessment and has remanded the case to the assessing authority ; or (b) for want of reasonable opportunity of being heard, set aside or has directed the assessing authority to set aside an ex parte order of assessment or re-assessment ; or (c) quashed any order of assessment or re-assessment for want of jurisdiction or for want of notice, the assessing authority may make order of assessment or re-assessment before expiry of the assessment year succeeding the assessment year in which such order or direction is received by the assessing authority by due process : Provided that where any assessment or re-assessment order is quashed by any authority or Court, for want of notice or for want of jurisdiction, the order of assessment or re-assessment may be made, within the time mentioned above in this sub-section, by the competent assessing authority after serving notice on the dealer." 10. Thus, where the High Court sets aside the order of reassessment for want of reasonable opportunity of being heard and directs the Assessing Authority to make a fresh order of assessment or re-assessment, the Assessing Authority may make an order of assessment or re-assessment, before expiry of the assessment year succeeding the assessment year in which such order or direction is received by the Assessing Authority by due process. In this view of the matter, it cannot be said that upon the re-assessment being set aside, the Assessing Authority will not be in a position to pass fresh assessment orders. 11. This apart, Sri S.D. Singh, learned Senior Counsel appearing for the respondents, on the instructions received from Sri Amit Mahajan and Sri Gaurav Mahajan, have very fairly stated that the petitioner shall not raise any objection to the limitation having expired on 31 March 2016. 12. For all these reasons stated above the assessment order dated 31 March 2016. Passed by the Assessing Officer in regard to the assessment year 2011-12 under the provisions of the U. P. Act and the provisions of the Central Act is, accordingly, set aside. The Assessing Authority shall now proceed to pass a fresh order in accordance with law after providing adequate and reasonable opportunity of hearing to the petitioner. Needless to state that the petitioner shall cooperate in the proceedings and shall not insist on any unnecessary adjournments. 13. The writ petition is allowed to the extent indicated above.