TMI Blog2014 (4) TMI 732X X X X Extracts X X X X X X X X Extracts X X X X ..... t vitiate the exercise of the power in question - Incorrect mentioning of the provision of law or even if it is not indicated in the notice issued to the assessee that AO has proceeded u/s 35(7), it would not prejudice the assessee as from the materials on record it is evident that AO has recorded reasons for proceeding against the assessee and thus, the assessee knew as to the nature of the proceeding and the demand raised by AO - From the proceeding before the Assessing Officer, it is clear that sufficient opportunity was given to Assessee - The petitioner was heard by AO - There was not required in law for issuing fresh notices u/s 35(7) and 40(2) to the assessee and therefore, held that impugned order dated 11.02.2013 has not been passed in violation of the principles of natural justice. Availability of remedy of Appeal/Review/ Revision – Held that:- Judgment in Asstt. Collector of Central Excise v. Dunlop India Ltd. 1984 (11) TMI 63 - SUPREME Court] followed - the Hon'ble Supreme Court has observed that Article 226 is not meant to short circuit or circumvent statutory procedures – Since JVAT Act, 2005 provides an effective remedy of appeal, these writ petitions cannot be en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... area of 640 acres in Village- Barai Buru- Tatiba, Barajamda, P.S.- Barajamda, District- Singhbhum-West, Jharkhand. The petitioner-company is registered under the Jharkhand Value Added Tax Act, 2005 (hereinafter referred to as the Act ) with TIN- 20241200662. It is stated that Schedule- II of the Mines and Minerals (Development and Regulation) Act, 1957 provides the rate of royalty in respect of minerals and in terms of Section 9 of the Mines and Minerals (Development and Regulation) Act, 1957, a mining lessee has to pay royalty on consumption/removal of minerals at the rate prescribed in Schedule- II of the said Act. Entry-22 of Schedule- II provides that the royalty for Iron Ore Lumps and Fines would be the sale price at ad valorem basis. The petitioner was paying royalty at the rate of 10% of the sale price. Prior to the said Notification there was fixed royalty for different quality (iron content) of Iron Ore on tonnage basis. However, basis was changed to ad valorem by the subsequent Notification. The Central Government in exercise of powers conferred by Section 13 of the Mines and Minerals (Development and Regulation) Act, 1957 amended the Mineral Concession Rules, 1960 and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of the petitioner-company and therefore, the assessment is absolutely illegal. The petitioner-company has not suppressed any sale figure or any sale amount and therefore, not liable to pay any amount. It is also stated that, there being no evidence that the petitioner-company has escaped tax, any proceeding under Section 40(2) of the Act cannot be initiated and no order can be passed. 6. A counter-affidavit has been filed on behalf of Respondent nos.3 and 4 stating that the petitioner has moved this Hon'ble Court without availing the alternative remedy of Appeal available to him under the Act. It is stated that the petitioner has not moved the Court with clean hands and it has indulged in tax evasion by deliberately undervaluing its products in the invoices raised by it. Section 35(7) of the Jharkhand Value Added Tax Act, 2005 was introduced to curb tax evasion which the dealers were adopting by way of undervaluation or under-pricing in the sale invoices than the actual price. Section 35(7) of the Act has become an effective tool for checking tax evasion and this is in the interest of public revenue. 7. It is stated that certain data were obtained from the Mining Depar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is further stated that the Indian Bureau of Mines is a Government of India agency which determines and publishes the average sale price of minerals for each month area-wise and grade-wise after taking into account the average sale price of 10 big dealers of the products in that particular area and thus, the average sale value published by Indian Bureau of Mines is the most authentic and reliable and cannot be disputed. The respondents collected the figure of raising and dispatches from the Mining Office, Chaibasa which included data of dispatches per month. On perusal of data received from the Mining Office and sale details furnished in returns, it was noticed that, in comparison to prevalent market price as shown in the sale invoices by the assessee and average sale price as determined by Indian Bureau of Mines, the Iron Ores have been shown to have been sold at a much lower selling price. The matter thus, became concealment of actual sale price by under pricing and therefore, the respondent-authority issued notices on 05.06.2013 for the period 2010-11 and 2011-12 respectively which were duly served upon the petitioner-company however, the petitioner did not produce books of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to the assessee and by an order in writing direct that the assessee shall, in addition to any tax payable which is or may be assessed under Section 35 or 36 or 38, pay by way of interest at the rate stipulated thereon. It is submitted that the proviso to Section 35(7) and Section 40(2) and the scheme of the Act do stipulate that at each and every stage there is a requirement of issuing notice and opportunity of hearing before passing the impugned order. 13. It was submitted that without giving an opportunity of hearing and without issuing notice as contemplated under the proviso to Section 35(7), the Assessing Officer unilaterally passed the order under Section 35(7) and thereafter, passed an order under Section 40(2) of the Act. It was further submitted that the notice dated 17.01.2013 was issued fixing the date of hearing on 11.02.2013 and on 11.02.2013, the petitioner appeared and filed a time-petition but the Assessing Authority ignored the same and passed the impugned order without giving the petitioner an opportunity of hearing and therefore, there is gross violation of principles of natural justice. The learned counsel further submitted that even though Section 79 pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned counsel has submitted that the proceeding for assessment and self-assessment concludes under Section 35(5), if the prescribed authority is satisfied that the return or revised-return as the case may be, and self-assessment claim are prima-facie correct and the prescribed authority accepts self-assessment. However, if the prescribed authority is not satisfied then the prescribed authority proceeds under Section 35(7) and there is no requirement of issuance of any fresh notice to the assessee as the proceeding under Section 35(7) would be a continuation of the proceeding under Section 35(5). It is thus submitted that Section 35(7) does not require issuing a fresh notice in cases in which the proceeding under Section 35 of the Jharkhand Value Added Tax Act, 2005 is in progress. It only talks of providing an opportunity of hearing to the dealer/assessee. Contrasting the provision under Section 35(7) with Section 37 which relates to audit assessment, the learned counsel has submitted that while Section 37 specifically requires serving a notice in the prescribed manner to the dealer/assessee however, no such requirement can be read into Section 35(7). In support of the above c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue has contended that since in a pending proceeding, the Assessing Officer has proceeded to determine the value of goods under section 35(7) of the Act, there was no requirement for issuing a fresh notice to the assessee. 22. It is not disputed by the parties that the impugned order has been passed when the regular assessment under Section 35 of the Act was in progress. On 05.06.2012 the Assessing Officer issued notice to the assessee for verification of the data received from the Department of Mines. From the proceeding before the Assessing Officer, it appears that the Assessing Officer did not accept the self-assessment as filed by the assessee under Section 35(5) of the Act and therefore, the Assessing Officer proceeded to assess the value of goods under Section 35(7) of the Act. Proviso to Section 35(7) provides that prescribed authority is required to record reason and afford opportunity of being heard to the dealer. In the present case, the proceeding before the Assessing Officer discloses that when it was found that the sale price as disclosed by the assessee and the data supplied by the Department of Mines, Chaibasa were not in conformity with each other and the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, this Court will always rely upon Section 114 illustration (e) of the Evidence Act to draw a statutory presumption that the official acts are regularly performed and if satisfied that the action in question is traceable to a statutory power, the courts will uphold such State action. 28. In the present case, a common Form is prescribed for issuing notice. The incorrect mentioning of the provision of law or even if it is not indicated in the notice issued to the assessee that the Assessing Officer has proceeded under Section 35(7), it would not prejudice the assessee as from the materials on record it is evident that the Assessing officer has recorded reasons for proceeding against the assessee and thus, the assessee knew as to the nature of the proceeding and the demand raised by the Assessing Officer. 29. The learned counsel for the petitioner has submitted that the assessee was not afforded reasonable opportunity of hearing and no proper notice was given to the assessee before the impugned order dated 11.02.2013 was passed. We find that the record produced in the W.P.(T) No. 1686 of 2013 discloses that when the data with respect to raising and dispatch of the goods from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Act, 2005 provides forum for appeal, revision and review of the orders passed under the Act. Section 79 provides that against the order of assessment or penalty or both passed by the prescribed authority appeal lies to the Joint Commissioner or the Deputy Commissioner especially authorised in this behalf. Sub-Section (5) of Section 79 provides that the Appellate Authority may confirm, annul, reduce, enhance or otherwise the order passed by the prescribed authority or set-aside the order directing the Assessing Authority to make fresh order. Thus, there cannot be any doubt that Appellate Authority has vast powers under Section 79 of the Act. Similarly, Section 80 makes a provision for revision to the Tribunal against an order passed in the Appeal. Section 81 provides that against the order passed by the Tribunal under Section 80 of the Act, review would lie to the State Government. In the present writ petition, the petitioner has not disclosed any reason for not approaching the statutory authority under the Act. 31. In Raleigh Investment Co. Ltd. v. Governor General in Council AIR 1947 (34) PC 78, Lord Uthwatt, J. observed that in the provenance of tax where the Act provided f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edures. The Hon'ble Supreme Court has observed as under : 3. .....It is only where statutory remedies are entirely ill suited to meet the demands of extraordinary situations, as for instance where the very vires of the statute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public justice require it that recourse may be had to Art. 226 of the Constitution. But then the Court must have good and sufficient reason to by-pass the alternative remedy provided by statute. Surely matters involving the revenue where statutory remedies are available are not such matters. We can also take judicial notice of the fact that the vast majority of the petitions under Art. 226 of the Constitution are filed solely for the purpose of obtaining interim orders and thereafter prolong the proceedings by one device or the other The practice certainly needs to be strongly discouraged. 33. In the background of facts as notices above, we hold that the assessee was afforded sufficient opportunity of hearing and the impugned order has not been passed in violation of the principles of natural justice. Since the J ..... X X X X Extracts X X X X X X X X Extracts X X X X
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