Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2020 (12) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (12) TMI 947 - HC - VAT and Sales TaxValidity of reassessment order - Assessing Authority issued a revised notice under Section 39(1) of the Act proposing to reject monthly returns filed in respect of tax periods (5 months) were there was short payment of tax by the petitioner and undertake re-assessment only in respect of said tax periods - petitioner submitted that the authorities have grossly erred in ignoring the provision as it stood during the disputed period and instead considering the amended Section 39(1) of the Act which came into force with effect from 01.04.2007 - Section 39(1)(a) of Karnataka VAT Act - HELD THAT:- Even prior to amendment with effect from 01.04.2007, the Assessing Authority under Section 39(1) of the Act could re-assess the tax, if it has grounds to believe that any return furnished is deemed as assessed is incorrect or that any assessment issued under Section 38 understate the correct tax liability and could reassess the additional tax payable. Section 2(33) of the Act read with Rule 37(2) with the Rules defines tax period to mean a calendar month. Section 35 of the Act requires dealers to file returns for each tax period and as per Section 38 of the Act every dealer is deemed to be assessed to tax based on the return filed by him under Section 35 of the Act. Admittedly, there has been a short payment of tax in respect of tax periods namely April, June, July and August 2005, April, May, August, November and December 2006 and February 2007. It is also not in dispute that the orders of re-assessments have been passed in respect of the periods where there has been a short payment of tax. The Assessing Authority in the light of Section 2(33) of the Act and Rule 37(2) of the Rules has rightly taken each month as separate period of assessment. It is also pertinent to note that Section 35 requires dealers to file returns for each tax period and as per Section 38 every dealer is deemed to be assessed to tax as per Section 35 of the Act. Therefore, deemed assessment applies for each tax period and Assessing Authority while taking up re-assessment proceeding has to consider the tax paid in respect of each month and not for the year as a whole. Section 39(1) of the Act requires the Assessing Authority to reassess the additional tax payable. Therefore, the Assessing Authority has rightly reassessed the tax period in respect of which there was a short payment of tax. The reliance placed by the petitioner on the audited statement of accounts is misplaced as the same cannot be considered to be return and the same would tantamount to doing violence to the provisions of Sections 35(1) and Section 35(4) of the Act, which prescribe time periods for filing and revising of returns. It is pertinent to note that payment of tax due, if any, with Form VAT-115 and Form VAT-240 is only facility to pay the balance of tax, which was not paid in the earlier opportunities of filing the returns connected and revised returns as the case may be so that tax due according to law should be remitted to state in full. The aforesaid provision would not exempt assessee from payment of original tax liability under Section 35(1). The tax has to be assessed as per provisions of the Act, which provide for tax period as a month. Even though, Tribunal may have referred to amended provisions of the Act, however, it is trite law that mere mention of a wrong provision would not invalidate an order so long as power exists with the authority. In the instant case, the re-assessment have rightly been initiated as the power to do so exists even under the un-amended Section 39(1) of the Act. The Tribunal has neither failed to decide any question of law nor has decided any question law erroneously. Petition dismissed.
|