Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + SC VAT and Sales Tax - 2022 (7) TMI SC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (7) TMI 454 - SC - VAT and Sales TaxExtension of time limit for completion of assessment - Power of the Commissioner to allow further time of six months to the Assessing Authority to complete the audit assessment must be exercised before the Assessing Authorities time to conclude the proceedings expire - Assessing Authority could pass the assessment order after the period of six months in expectation of the Commissioner extending the time or not - grant of post-facto extension, ratifying the assessment order passed beyond the period of six months - HELD THAT:- Even where a statute uses varied expression such as ‘deferment’ or ‘extension’, the purpose is only to grant further time to the Assessing Authority to complete the assessment. Therefore, there is no purpose in drawing a distinction in the power of extension by referring to the specific expressions used in different statutes provisioning extending the time. The ratio of the judgment is that, upon the lapse of period provided for the AO to make the assessment, the right of the department to assess gets extinguished. This extinguishment also gives rise to a valuable right to the assessee. Once the right to make assessment extinguishes there is no question of extension of time when the assessment has become time barred. There are similar provisions under the Income Tax Act,1961 i.e., Section 139(2) where this Court in COMMISSIONER OF INCOME-TAX VERSUS AJANTA ELECTRICALS [1995 (5) TMI 1 - SUPREME COURT] has taken a view that the power of extension can be granted by an Income Tax officer even after the expiry of the prescribed period. Considering from the perspective of administrative law, the time limitations are restrains placed by the legislature to regulate exercise of administrative power. They are intended to enforce discipline in governance and could therefore be compelling guidelines or even mandatory prescriptions. The Court must therefore, examine the provisions in the context of balance between need for executive flexibility and the quest against arbitrariness. It is the duty of the Court to synthesize these competing claims keeping in mind the public interest of good governance. This Court has traditionally drawn a distinction between statutes prescribing no time limit while performing public duties and statutes providing a time limit. Even with the statutes providing for the time limit, there is a distinction between statutes providing for consequence for not acting with the time limit and statutes not providing for any such consequences. Examination of these factors become necessary for appreciating the procedural ultra vires in the executive action. For the present, we need not say anything more. In the case of STATE OF PUNJAB AND OTHERS VERSUS M/S SHREYANS INDUS LTD. ETC [2016 (3) TMI 331 - SUPREME COURT], it was held that the Commissioner should have exercised the power of extension before the original period of limitation expired on 31.03.2013. - These matters must be placed before a three Judge bench for a consideration of the principle in Shreyans Industries and also on the applicability of the said judgment to the proceedings arising under the Act.
|