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2023 (3) TMI 795 - HC - VAT and Sales TaxAudit assessment under Section 34(2) of the Value Added Tax Act, 2003 - main plank of the challenge to the notice and the consequential order dated 1.9.2022 and 16.9.2022 respectively that the powers were invoked under Section 34(8A) of the Act despite the fact that no proceedings were pending - HELD THAT:- Section 34 of the Act deals with the audit assessment. It says that subject to the provisions of Sub section (2), the amount of tax due from registered dealer shall be assessed in the manner provided, separately for each year during which the registered dealer is liable to pay tax. The clinching aspect is that the condition precedent for exercising powers under Section 34(8A) has not been satisfied, namely that any proceedings under the Act are not pending so as to invest the authority with the power to proceed under Sub section (8A) of Section 34. When the Section expressly contemplates that the assessment under the said provisions could be resorted to only during the proceedings under the Act, the powers has to be exercised in that manner only and upon fulfillment of the said condition. In the facts of the case there is no gainsaying that any proceedings are not pending so as to justify the assessment proceedings under Section 34(8A) of the Act. When learned Assistant Government Pleader was confronted with the aforesaid aspect and non-compliance of the condition precedent for exercise of powers of assessment, he was entirely at his receiving end. Since the basic condition ‘during the course of any proceedings under the Act’ of Sub section (8A) of Section 34 of the Act is not satisfied and no proceedings under the Act are pending, the impugned notice dated 1.9.2022 and the assessment order dated 16.9.2022 stands without jurisdiction. It is an incurable jurisdictional defect and illegality rendering the notice and the order liable to be set aside - Petition allowed.
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