M/S M.U.A. Armugaperumal and Sons v. The Additional Commercial Tax Officer(FAC), Srivilliputtur

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 24.04.2008 CORAMTHE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIANANDTHE HONOURABLE MR. JUSTICE P.PS.JANARTHANA RAJAW.A.NO 3243 of 2004& WAMP NO.6107 of 2004M/S M.U.A.Armugaperumal and Sons,Exporters, 636/15, Rajapalyam Road,Chatrapatti-626 102... AppellantVs.The Additional Commercial Tax Officer(FAC),Srivilliputtur.... Respondent For Appellant : Mr.R.Venkatraman, S.C., For Mr.T.Ramesh KuttyFor Respondent : Mr.Haja Naziruddin Special Government PleaderWrit appeal filed under clause 15 of the letters Patent againstthe order dated 30.07.2004 made in W.P.NO.32 of 2004. petition filedunder article 226 of the constitution of India to issue a Writ ofCertiorari calling for the records of the case on the file of therespondent herein in Pro.TNGST.913553/95-96 dt 1.6.2004 relating tothe assessment year 1995-96 and quash the same.JUDGMENT(Judgment of the court was made by P.P.S.JANARTHANA RAJA,J.)The above appeal is filed against the order dated 30.07.2004made in W.P.No.32 of 2004. https://hcservices.ecourts.gov.in/hcservices/

2. The appellant herein had filed the writ petition seeking toquash the proceedings in Pro.TNGST NO.913553/95-96 dated 01.06.2004relating to the assessment year 1995-96.3. The facts of the case proceed as follows :The appellant is a manufacturer and exporter of cotton fabricsat Chatrapatti. The assessment year is 1995-96. The appellant is anassessee on the file of the respondent registered under theprovisions of the Tamil Nadu General Sales Tax Act, 1959 and theCentral Sales Tax Act, 1956. During the assessment proceedings, therespondent verified the books of accounts on 07.02.1997 and fixed thetotal and taxable turnover as Rs.19,86,04,287/- and Rs Nilrespectively. Since the taxable turnover was nil, no intimation wassent as regards the completion of the original assessmentproceedings. Later a pre-revision notice dated 14.04.2004 had beenissued on the basis of the information received from the CommercialTax Officer, Harbour-II, Assessment Circle, Chennai, that theappellant had effected sales of REP licence for Rs.10,46,359/- from01.04.1995 to 31.03.1996 and directed the appellant to sendobjection, if any, to the proposal. The appellant immediately sent anobjection dated 27.04.2004 to the respondents submitting that therevision of assessment under Section 16(1)(a) of the TNGST ACT wasclearly barred by limitation on the ground that pre-revision noticewas issued on 14.04.2004, which is after the expiry of five years.After considering the objection, the respondent has completed therevised assessment year 1995-96, which is as follows:Total turnover for the year 1995-96 -Rs. 10,46,359.00Taxable turnover determined for the year 1995-96 -Rs. 10,46,359 x 8/100Tax due -Rs 83,709/-Tax paid -NilBalance - Rs. 83,709.00 Surcharge: Surcharge @ 15% is also levied for the year 1995-96.Surcharge due - Rs 12.556.00Surcharge paid - Rs. NilBalance - Rs. 12,556.00Aggrieved by the revised assessment order, the appellant filed thewrit petition in W.P.No.32 of 2004 challenging the revised ordermade by the respondent on the ground that it is ex facie, illegal,barred by limitation and without any basis and justification. Afterhearing, the learned single judge has dismissed the writ petition on30.07.2004 by holding as follows:" In result, https://hcservices.ecourts.gov.in/hcservices/ (i)The above Writ Petition does not merit admission forthe foregoing reasons assigned, but becomes only liable tobe dismissed at the admission stage itself and is dismissedaccordingly.(ii)However, the learned senior counsel for thepetitioners has a request to be made with the Court thatsince he has made an attempt before this court under theconstitutional provisions in filing the above writpetition, much time is lost and would crave permission toelongate the time for preferring the regular appeal beforethe appellate authority. Since it is a reasonable requestmade on the part of the learned senior counsel for thepetitioner, the lower appellate authority is herebydirected to entertain the appeal, provided the same ispreferred within thirty days from the day that this ordercopy is made ready.(iii)The appellate authority is further directed toconsider and pass such interim orders which are necessaryin the circumstances of the case even during the pendencyof the appeal, if sought for, in strict observance of thelaw, rules and procedures. However in the circumstances of the case, there shallbe no order as to costs."Aggrieved by that order, the appellant has filed the present appeal.4. The learned senior counsel appearing for the appellant hassubmitted that the revision of assessment passed by the Respondentfor the assessment year 1995-96 is statutorily barred by limitation.Further it was contended that when the Respondent has no jurisdictionto revise the assessment, the existence of alternate remedy of filingappeal is not a bar in approaching this Court. It is thereforesubmitted that the impugned order passed by the Respondent is not inaccordance with law. 5. The learned Government pleader appearing for the respondentsubmitted that the appellant has effected the sales of REP licencefor Rs.10,46,359/- from 01.04.1995 to 31.03.1996 and hence, there isan escape turnover under Section 16 of the TNGST Act. It is furthercontended that respondent has correctly invoked the provision ofSection 16 of the Act and it is well within the time. It is alsofurther submitted that there is an alternative remedy available underthe statute. Without exhausting the same, the appellant hasapproached the Court by filing the writ petition and, therefore, thelearned single judge is right in dismissing the writ petition and thesame should be confirmed. https://hcservices.ecourts.gov.in/hcservices/

6. Heard the learned counsel appearing on either side. The onlypoint for consideration is whether the revised assessment is passedwithin the time prescribed or not. Section 16(1)(a) of the TNGST Act,1959, is the relevant provision, which reads as follows:" Where, for any reason, the whole or any part of theturnover of business of a dealer has escaped assessment totax, the assessing authority may, subject to theprovisions of sub-section (2) at any time within a periodof five years from the expiry of the year to which the taxrelates, determine to the best of its judgment theturnover which has escaped assessment and assess the taxpayable on such turnover after making such inquiry as itmay consider necessary and after giving the dealer areasonable opportunity to show cause against suchassessment." The above section deals with the revised assessment of escapedturnover. From a bare reading of the above provision it is clear thatif for any reason, the whole or any part of the turnover of businessof a dealer has escaped assessment of tax, the assessing officer haspower to revise the assessment at any time within a period of fiveyears from the expiry of the year to which the tax relates. In thepresent case, the assessment year is 1995-96 and the period of fiveyears expires on 31.03.2001. However, the assessing officer has powerto re-assess on or before 31.03.2001. But, the pre-revision noticewas issued only on 14.04.2004. The appellant has also sent anobjection on 7.04.2004 and the revised assessment was finally passedon 01.06.2004. From the above facts, it is very clear that the noticeissued on 14.04.2004 and the revised assessment order passed underSection 16 of the Act on 01.06.2004, are statutorily barred bylimitation.7. It is also brought to our notice that Section 16(1)(a) of theAct was later amended by Amended Act 22 of 2002 with effect from01.07.2002. The amended provision of Section 16(1)(a) of the TNGSTAct, 1959 (amended Act 22 of 2002) reads as follows:" Where, for any reason, the whole or any part of theturnover of business of a dealer has escaped assessment totax, the assessing authority may, subject to the provisionsof sub-section (2) at any time within a period of fiveyears from the (date of order of the final assessment bythe assessing authority) determine to the best of itsjudgment the turnover which has escaped assessment andassess the tax payable on such turnover after making suchinquiry as it may consider necessary and after giving thedealer a reasonable opportunity to show cause against suchassessment. " https://hcservices.ecourts.gov.in/hcservices/ From a bare reading of the provision, it is clear that the limitationperiod commences from the date of final assessment order. The saidprovision came into effect prospectively and not retrospectively.There is nothing in the amendment made to Section 16(1)(a) that thesame was intended to operate retrospectively. There is no disputeregarding the same. Therefore the amended provision is not relevant.There is also no dispute that the revision of assessment is barred bylimitation as early as on 31.03.2001, which is much before theintroduction of amended provision of Section 16(1)(a) by AmendmentAct of 22 of 2002, which came into effect from 01.07.2002. Comingto the next contention regarding alternative remedy, normally underArticle 226 of the Constitution of India, the High Court should notexercise its writ jurisdiction when an alternative remedy isavailable under the statute and the same can be exercised only whenthe order is lacking jurisdiction or it is statutorily barred bylimitation. The appellant has established the revision of assessmentmade under Section 16(1)(a) of the Act is statutorily barred bylimitation and therefore, it is a fit case for the interference underArticle 226 of the Constitution of India. Further we are also of theview that the revised assessment made by the respondent is illegal,wrong, without basis and justification.10. For the foregoing reasons, we are of the view that therevised assessment passed by the appellant is statutorily barred bylimitation under Section 16(1)(a) of the TNGST Act. Hence, we setaside the order of the learned single judge and the writ appeal isallowed. No costs. Consequently WAMP No.6107 of 2004 is closed.sd/-Asst.Registrar/true copy/Sub Asst.RegistrarraaToThe Additional Commercial Tax Officer (FAC),Srivilliputtur.1 cc To The Special Government Pleader (Taxes), SR.24132+1 cc To Mr.T.Ramesh Kutty, Advocate, SR.23659W.A No.3243 of 2004mdr [co]gkg/16.6