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2016 (6) TMI 391 - DELHI HIGH COURTValidity of default notices of assessment of tax and interest issued u/s 32, 33 and 59(2) of DVAT - Availability of alternative remedy - Ex parte notices - notice deemed to be served - pasting of the notices on the web page of the dealer - Held that:- the Court finds, that there are obvious glaring errors in each of the impugned orders which appear to system generated and issued without application of mind. In the circumstances relegating the Petitioner to the alternative remedy of going before the OHA would cause further delays in resolving the disputes that have arisen and would not be efficacious. Therefore, the above preliminary objection is rejected. Service of notices - Section 59 (2) DVAT Act - Held that:- Unless it has been agreed to the contrary between the originator and the noticee, the service of an electronic record will occur only when it enters a computer resource outside the control of the originator. Section 100A of the DVAT Act, inserted with effect from 16th November 2005, enables the Commissioner to issue summons/notices/orders in electronic form. Section 100A of the DVAT Act appears to be in conformity and consistence with Sections 12 and 13 of the IT Act. The originator of the notices is a statutory authority, having the powers in terms of the DVAT Act read with the DVAT Rules to prescribe the manner of service of electronic orders, summons, notices etc. The Commissioner, as the originator of the notices under Section 59 (2) of the DVAT Act, has in terms of the order issued by him on 17th January 2014 deemed that pasting of the notices on the web page of the dealer would be deemed service of notice on the dealer. The Petitioner being a registered dealer under the DVAT Act ought to have been aware of the Order dated 17th January 2014 issued by the Commissioner. The Petitioner was required to go to its account on the DT&T website to view the notices posted on the said website. If the Petitioner had given the mobile phone details to the DT&T, it would have received SMS alerts as well. The failure by the Petitioner to go to the website to view the impugned notices, notwithstanding the order dated 17th January 2014 of the Commissioner, disables it from contending that there is no proper service on it of the said notices under Section 59 (2) of the DVAT Act. Issuance of notices by Record Keeper - Held that:- while there is a noting signed by the Record Keeper that reads: “default assessment orders and penalty framed under Section 32 and 33", there is nothing beyond that to suggest that it was the Record Keeper who framed such orders. It is plausible that the Record Keeper was merely noting the fact of the notices having been framed. From this it is not possible to infer that the impugned notices of default assessments of tax, interest and penalty were issued by the Record Keeper and not by the VATO. Validity of ex parte default notices of assessment of tax, interest and penalty - Section 32 & 33 of the DVAT Act - Inter-state sales - Held that:- each of the impugned notices of default assessment of tax and interest reveal inter alia the tax period for which the demand has been raised. While Column 2 titled 'turnover reported by dealer' contains a figure (presumably as shown in the return filed by the dealer), Columns 3 and 4 titled 'turnover assessed' and 'tax paid' are shown as '0'. The remaining Columns 5, 6, 7 and 8 titled 'tax assessed', 'additional tax due, 'interest' and 'total amount due contain figures. If the turnover assessed is zero, it is not possible that the tax assessed is at a figure for e.g., of ₹ 14,43,938 for the first quarter of 2014. This sort of obvious error can only be explained by some defect in the system through which the said notices have been generated. No attempt has been made by the DT&T to explain the error. The second obvious error is that the impugned notices of default assessment claim that the Petitioner made inter-state sales to the dealer in Rajasthan who was found to be a 'suspicious/bogus' dealer. The notices proceeds to state that “since the dealer has made ISS of fabrics to the tune of.”, he is being asked to pay additional tax and penalty under Section 86 (10) of the DVAT Act. If indeed the sale was an inter-state one, then only the CST Act would apply and not the DVAT Act. Therefore, each of the notices issued are set aside. Mr Narayan maintains that what the DT&T is seeking from the Petitioner is the information and documents mentioned in the notices dated 11th August 2015 issued under Section 59 (2) of the DVAT Act. Therefore, there is no need to issue fresh notices. - Petitions disposed
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