TMI Blog2014 (4) TMI 494X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 44 is only a mode of recovery and not the power of authority to pass any order deciding the liability of an assessee for payment of tax or any other monies due to the Government under the VAT Act - Such recovery therefore, necessarily shall have to be provided by such order as may be passed by the competent authority in terms of provisions of VAT Act - Only once the demand is quantified the question of recovering either through the special mode as provided in section 44 or through any other mode under the Act would arise. When admittedly no order of assessment or any other order of quantification of the assessee’s liability was passed, straightway ordering recovery without any opportunity of hearing to the assessee was wholly no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s taken for final hearing straightway at the request of learned counsel for the parties. The Government has challenged an order of the Value Added Tax Tribunal ( the Tribunal for short) dated 30.4.2010. 4.Brief history is as follows : 4.1. The respondent company (hereinafter referred to as the assessee ) is engaged in the activities of manufacturing and exporting goods. For the said purpose, the respondent established two units which were covered by sales tax incentives declared by the State Government. These units were for the purpose of manufacturing pipes and coating pipes respectively. The assessee was entitled to purchase goods from the registered dealer at a concessional rate of duty and on the sales made by the company, it co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 25.05.09 to curtail the incentive limit even by tax relating to purchases of goods used for the manufacture of goods exported outside the country and recovery of such amount in cash is bad and illegal and liable to be set aside. 2. In our view, it may be held that incentive limit cannot be curtailed by tax relating to purchase of goods used in the manufacture of goods exported outside the country. In view of the same the authority is directed to assess the case of the appellant accordingly. 4.5. While doing so, the tribunal examined various statutory provisions and the tax exemption scheme of the State Government and on merits came to the conclusion that the stand of the assessee was right and that remission incentive on the expor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that powers under section 45 are extraordinary measures to be taken for protecting the interest of the Government revenue when necessary requirements are satisfied. Even then the order that can be passed is one of provisional attachment and life of such attachment is limited to that provided in subsection (2). 9.On the other hand, section 44 of the VAT Act pertains to special mode of recovery. Sub-section (1) there of reads as under : 44. (1) Notwithstanding anything contained in any law or contract to the contrary, the Commissioner may, at any time or from time to time, by notice in writing, a copy of which shall be forwarded to the dealer at his last known address, require,-- (a) any person from whom any amount of monies is due, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admittedly no order of assessment or any other order of quantification of the assessee s liability was passed, straightway ordering recovery without any opportunity of hearing to the assessee was wholly not permissible. 11. In that view of the matter, tribunal s final conclusion that notice of recovery and the appellate order confirming such notice must be quashed, was perfectly in order. 12. We are however, in agreement with the suggestion of learned AGP that while doing so the tribunal could not have gone into the validity of merits and de-merits of rival stands. Such a stage had not yet arisen. The tribunal therefore, committed an error in striking down the Government demand holding that the assessee was entitled to retain all exp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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