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2020 (11) TMI 20 - HC - VAT and Sales TaxReopening of assessment - Interest Subsidy - Submissions were made that the Tax Board came to the conclusion that the department could not exercise powers under Section 26 of the RVAT Act, 2003 as the said power was not available under the RIPS, 2003 and also came to the conclusion on merits of the dispute that the amount of partial exemption received by the assessee was not part of payable tax and, therefore, basis for raising the demand was also quashed - it was submitted that the entire basis for reassessment is non-existent as the assessee was rightly allowed the subsidy and the interpretation sought to be placed on the term tax payable by including the amount of partial exemption granted under the CST Act cannot be sustained. HELD THAT - The facts are not in dispute, whereby, initially under the RIPS, 2003 the orders were passed determining the amount of subsidy to the respondent assessee by orders dated 1/12/2012, 27/2/2013, 29/3/2013 and 21/6/2013 for four quarters beginning from 1/4/2011 and ending with 31/3/2012. Whereafter, a notice under Section 26 of the RVAT Act, 2003, which pertains to escaped assessment was issued on 27/5/2016 and after hearing the assessee, the Commercial Taxes Officer, Special Circle-II, Bhilwara by its order dated 22/6/2016 came to the conclusion that the assessee was allowed excess subsidy based on its interpretation of the words tax payable in the Scheme and consequently raised the demand along with interest. It was determined that the amount of partial exemption granted under the CST Act was not tax payable - It is not in dispute that the RIPS, 2003 did not contain any provision for reopening the orders passed under the Scheme or for their rectification. The only provisions which dealt with variation of the orders were for review and appeal under Clause 12, whereby, SLSC and DLSC were empowered to review their decisions and SLSC was made appellate authority and power of revision was given to the State Government under Clause 13, whereby, it could suo moto or otherwise review an order passed by the Screening Committee. The law on the aspect is well settled that if the right of the assessing authority to reopen the assessment is barred under the law for the time being in force, no subsequent enlargement of right can revive such right in the absence of express words or necessary intendment - the apparent exercise of power by the assessing officer under Section 26 of the RVAT Act, 2003 for reopening the order passed in absence of any enabling power cannot be sustained. Once this Court has also come to the conclusion regarding lack of jurisdiction in the assessing authority to pass the assessment order, the determination made by the Tax Board on merits, loses its significance. Therefore, in the circumstances of the case, it is left open for the petitioner department to agitate the issue, as determined by the Tax Board, in an appropriate case and to that extent, as this Court has not dealt with the aspect on merits, it would always be open for the petitioner department to raise and agitate the issue, if the occasion arises. Revision petition dismissed.
Issues Involved:
1. Jurisdiction of the Assessing Officer under the RVAT Act, 2003 to reopen assessments under RIPS, 2003. 2. Applicability of RVAT Act, 2003 provisions to RIPS, 2003. 3. Interpretation of 'tax payable' under the CST Act for subsidy calculations. 4. Retrospective application of amendments to RIPS, 2003. Detailed Analysis: 1. Jurisdiction of the Assessing Officer under the RVAT Act, 2003 to reopen assessments under RIPS, 2003: The primary issue was whether the Assessing Officer had the jurisdiction to reopen assessments under RIPS, 2003 using Section 26 of the RVAT Act, 2003. The Tax Board concluded that the RVAT Act, 2003 provisions were not applicable to RIPS, 2003, thus invalidating the reopening of the assessments. The court affirmed this conclusion, emphasizing that the power to reopen assessments was not conferred under RIPS, 2003, and any exercise of such power by the Assessing Officer was unsustainable. 2. Applicability of RVAT Act, 2003 provisions to RIPS, 2003: The court examined whether the RVAT Act, 2003 provisions, specifically Sections 26 and 33, were applicable to RIPS, 2003. It was noted that initially, RIPS, 2003 did not include provisions for reopening or rectifying orders under the RVAT Act, 2003. An amendment in 2008 introduced Section 33 for rectification of mistakes, but no provision for reopening assessments was included. The subsequent schemes (RIPS, 2010 and RIPS, 2014) explicitly included provisions for the applicability of the RVAT Act, 2003, highlighting the absence of such provisions in RIPS, 2003. The 2018 amendment to RIPS, 2003, which introduced Clause 9A, made the RVAT Act, 2003 applicable from 1/7/2017, reinforcing that prior to this date, the RVAT Act, 2003 was not applicable to RIPS, 2003. 3. Interpretation of 'tax payable' under the CST Act for subsidy calculations: On the merits of the dispute, the Tax Board determined that the 'partial exemption' granted under the CST Act was not part of the 'tax payable.' This interpretation was crucial for calculating the interest subsidy under RIPS, 2003. The court noted that the Tax Board's finding on this issue was not necessary for adjudication once it was established that the Assessing Officer lacked jurisdiction. However, the court left open the possibility for the petitioner department to raise this issue in future cases. 4. Retrospective application of amendments to RIPS, 2003: The court addressed the argument regarding the retrospective application of the 2018 amendment to RIPS, 2003. It was clarified that the amendment was explicitly stated to be effective from 1/7/2017, and there was no basis for applying it retrospectively beyond this date. The court cited legal precedents to support the principle that a subsequent enlargement of rights cannot revive a barred right unless expressly stated. Therefore, the provisions of the RVAT Act, 2003 could not be applied to RIPS, 2003 assessments conducted before 1/7/2017. Conclusion: The court dismissed the revision petitions, affirming the Tax Board's findings on the lack of jurisdiction of the Assessing Officer and the inapplicability of the RVAT Act, 2003 to RIPS, 2003 at the relevant time. The court also clarified that the merits of the reassessment issue could be raised in future cases by the petitioner department. No order as to costs was made.
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