TMI Blog2014 (8) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... ication does not use the expression "disposable containers made of plastic" would not furnish any ground to the Additional Commissioner to permit a reopening of assessment. The Assessing Authority had duly applied its mind to the business activities of the petitioner and as the assessment order would indicate, the authority was conscious of the position that the petitioner manufactures disposable containers. In this view of the matter, there was absolutely no tangible material before the Assistant Commissioner to issue an authorization and the initiation of proceedings would have to be held as being contrary to law. Tax administration must be based on the principles of certainty and stability. Certainty and stability ensure objective, fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne-II, Kanpur by which reassessment proceedings have been initiated against the petitioner for Assessment Year 2007-08. The petitioner also seeks to question the consequential reassessment notice. The petitioner is engaged in the manufacture and sale of plastic containers and was duly registered under the U.P. Trade Tax Act, 1948, which has since been repealed w.e.f. 1 January 2008. After the enforcement of the U.P. Value Added Tax Act, 2008, the petitioner has obtained registration as a manufacturer and seller of plastic containers. During the course of the Assessment Year 2007-08 and upto 31 December 2007, containers made of plastic were taxable @ 8% at the point of sale by a manufacturer or importer by virtue of a notification dated 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment Year 2007-08 (1.4.2007 to 31.12.2007) in the extended period of limitation. The notice was issued on the premise that the goods manufactured by the petitioner were not covered by the taxing entry and that the petitioner was liable to suffer tax under the said entry @ 10%. The petitioner submitted a reply to the notice objecting to the proposed reassessment. By an order dated 21 March 2014, the Additional Commissioner has granted permission to the Assessing Authority to reassess the petitioner for the Assessment Year 2007-08 in the extended period of limitation on the premise that the petitioner has manufactured disposable plastic containers and that the taxing entry is not in respect of disposable plastic containers but only in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us order dated 5 May 2014 that the petition would be taken up for final hearing at this stage and has supported the order of the Additional Commissioner. Under sub-section (1) of Section 21, a power of reassessment is conferred upon the Assessing Authority if it has reason to believe that the whole or any part of the turnover of the dealer, from any assessment year or part thereof, had escaped assessment to tax or has been under assessed or has been assessed to tax at a rate lower than at which it is assessable or a deduction or exemption has been wrongly allowed. The foundational requirement of sub-section(1) is that there must be reason to believe. Under sub-section (2), no order of reassessment is permissible after expiration of two y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tangible material must be such as would warrant an inference that the turnover of the dealer has escaped the assessment to tax or that it has been under assessed or has been assessed at a lower rate or that deductions or exemptions have been wrongly allowed. In the present case, it is clear that the notification dated 5 February 2003 refers to plastic buckets, plastic basins, plastic soap case, plastic plates and other wares and containers made of plastic , amongst other things. The notification does not qualify the expression containers made of plastic by the words 'non disposable'. Merely because the notification does not use the expression disposable containers made of plastic would not furnish any ground to the Additiona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty and stability ensure objective, fair and accountable decision making procedures which are fundamental requirements of equality before law under Article 14 of the Constitution. Uncertainty produces chaos and renders the decision making process whimsical and arbitrary. This negates the fundamental right under Article 14 which is a guarantee against non arbitrariness. The precepts of Article 14 can and should be used not only to test the validity of legislative or administrative action but also to enhance that interpretation of the law which will render its administration and implementation fair. The proviso to sub-section (2) of Section 21 lifts the bar of time. But it cannot be construed to confer an unguided or subjective power to the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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