Judgment:
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:
30. 08.2013 CORAM: THE HON'BLE MRS.JUSTICE R.BANUMATHI AND THE HON'BLE MR.JUSTICE T.S.SIVAGNANAM W.A.NO.876 OF2005M/s.Universal Abrasives, represented by its Proprietor Jaffer Sadiq 38, G.N.T.Road, Chennai 600 051. .... Appellant Vs. The Commercial Tax Officer, Manali Assessment Circle, Kuralagam Annexe, I Floor, Chennai 600 108. ... Respondent For Appellant : Mr.T.Pramodkumar Chopda For Respondent : Mr.A.R.Jayaprathap, Govt.Advocate Prayer: Writ Appeal filed under Clause 15 of Letters Patent against the Order dated 25.1.2005 made in W.P.No.1600 of 2005 on the file of this Court. JUDGMENT
(Judgment of the Court was made by R.BANUMATHI,J.) The writ petitioner has preferred this appeal against the order dated 25.1.2005 made in W.P.No.1600 of 2005, whereby the learned single Judge dismissed the writ petition holding that the revised assessment order dated 23.8.2004 is beyond the period of limitation prescribed under Section 16(1)(a) of the T.N.G.S.T Act after amendment.
2. The brief facts of the case are as under: The appellant was assessed to tax under C.S.T.Act, 1956 for the assessment year 1997-98. Original order of assessment is dated 11.3.2000 passed by the Commercial Tax Officer, Manali and then pursuant to the said assessment order, the appellant had submitted representation for revision of assessment under Section 55 of the T.N.G.S.T.Act as there is an error in the disallowance of exemption of export sales and disallowance of claim of assessment at 4% against C-forms. Considering the said representation of the appellant, the Commercial Tax Officer passed the proceedings in C.S.T.50386/1997-98 dated 2.7.2002. Thereafter pre-revision notice in C.S.T.50386/97-98 dated 5.4.2004 was issued and revised assessment order in C.S.T.50386/1997-1998 dated 23.8.2004 was passed. Challenging the revised proceedings of the respondent Commercial Tax Officer dated 23.8.2004, the appellant has filed the writ petition in W.P.No.1600 of 2005 contending that the revised assessment order is beyond the prescribed period of limitation under Section 16(1)(a) of T.N.G.S.T.Act. Observing that the initial order of assessment in respect of the assessment year 1997-98 was passed on 11.3.2000 and that the final order of assessment came to be made on 2.7.2002 and that as per the amended provision of Section 16(1)(a), in respect of the escaped turnover, the revised proceedings could be issued within a period of five years from the date of the final order of assessment and that the impugned revised proceedings dated 23.8.2004 is well within the period of limitation the learned single Judge dismissed the writ petition. Challenging the dismissal of the writ petition, the assessee has filed this writ appeal.
3. The learned counsel for the appellant submitted that the original order of assessment for the year 1997-98 was dated 11.3.2000 and while so the Writ Court erroneously proceeded on the footing that the said assessment order dated 11.3.2000 was only provisional order and that the final order of assessment came to be passed on 2.7.2002. The learned counsel further submitted that the proceedings dated 2.7.2002 is only revised proceedings of the Commercial Tax Officer. The learned counsel submitted that the Writ Court was not justified in holding that the order dated 23.8.2004 was within a period of limitation under Section 16 of TNGST Act read with Section 9(2) of C.S.T.Act. It was submitted that the Writ Court ought to have seen that the revised proceedings dated 23.8.2002 is beyond the period of five years of the end assessment year viz., 1997-98 and therefore prayed for allowing of the writ appeal.
4. On behalf of the respondent, we have heard Mr.A.R.Jayaprathap, learned Government Advocate.
5. Prior to amendment, Section 16(1)(a) of the TNGST Act, 1959, which is the relevant provision, reads as under: Section 16. Assessment of escaped turnover.- (1) (a) Where, for any reason, the whole or any part of the turnover of business of a dealer has escaped assessment to tax, the assessing authority may, subject to the provisions of sub-section (2) at any time within a period of five years from the expiry of the year to which the tax relates, determine to the best of its judgment the turnover which has escaped assessment and assess the tax payable on such turnover after making such inquiry as it may consider necessary and after giving the dealer a reasonable opportunity to show cause against such assessment. Section 16(1) deals with the revised assessment of escaped turnover. By a reading of the above provision it is clear that where whole or any part of the turnover of business of a dealer has escaped assessment of tax, the assessing officer has power to revise the assessment at any time within a period of five years from the expiry of the year to which the tax relates. In the present case, the assessment year is 1997-1998 and the period of five years expires on 31.03.2003. The respondent has issued the impugned revised assessment proceedings on 23.8.2004 and the revised assessment proceedings is well beyond the period of five years and hence the revised assessment proceedings is clearly barred by limitation.
6. Section 16(1)(a) of the TNGST Act was later amended by Amended Act 22 of 2002 with effect from 01.07.2002 and as per the amended provision the impugned notice is well within the period of limitation. The amended provision of Section 16(1)(a) of the TNGST Act, 1959 (amended Act 22 of 2002) reads as follows: Where, for any reason, the whole or any part of the turnover of business of a dealer has escaped assessment to tax, the assessing authority may, subject to the provisions of sub-section (2) at any time within a period of five years from the (date of order of the final assessment by the assessing authority) determine to the best of its judgment the turnover which has escaped assessment and assess the tax payable on such turnover after making such inquiry as it may consider necessary and after giving the dealer a reasonable opportunity to show cause against such assessment. By reading of the provision, it is clear that the limitation period commences from the date of final assessment order. The said provision came into effect prospectively and not retrospectively. There is nothing in the amended provision Section 16(1)(a) that the same was intended to operate retrospectively. Therefore the respondent cannot resort to the amended provision Section 16(1)(a) to sustain the impugned revised proceedings of assessment.
7. As pointed out by the learned counsel for the appellant, the original order of assessment for the year 1997-98 was issued in proceedings CST.50386/97-98 dated 11.3.2000. Even though the said assessment order dated 11.3.2000 has not been filed in the typed set of papers, in the revised proceedings dated 2.7.2002, the said proceedings dated 11.3.2000 has been shown as reference No.1. Hence, the said assessment order dated 11.3.2000 is the original assessment order. The proceedings dated 2.7.2002 is only a revised proceedings of the Commercial tax officer considering the representation of the petitioner regarding the disallowance of the exemption on export sales and disallowance of claim of assessment at 4% against the C forms. As rightly contended by the learned counsel for the appellant, the proceedings dated 2.7.2002 is only a revised proceedings and not a original order of assessment, since the original order of assessment for the assessment year 1997-98 is dated 11.3.2000. As per the unamended provision of Section 16(1)(a) of C.S.T.Act, any revision of assessment of the escaped turnover ought to have been made within a period of five years from the expiry of the year to which tax relates. Since the assessment year is 1997-98, in the case on hand, any revision of proceedings ought to have been issued on or before 30.3.2003. But the impugned revision notice was issued on 5.4.2004 and the impugned revised order for the year 1997-1998 was issued on 23.8.2004, which is beyond the period of five years stipulated in Section 16(1).
8. In the result, we hold that the order of the learned single judge is set aside and this appeal is allowed. However, there is no order as to costs. Consequently, the connected miscellaneous petition is closed. usk Copy to: The Commercial Tax Officer, Manali Assessment Circle, Kuralagam Annexe, I Floor, Chennai 600 108