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Ansal Properties & Infrstructure Ltd. Versus Commissioner of Trade &Taxes, Delhi

2015 (12) TMI 180 - DELHI HIGH COURT

Validity of reassessment proceedings - Escapement of sales turnover - Held that:- Court, after surveying the earlier cases that clarified the legal position held that the requirement of the AA having to record ‘reasons to believe’ preceding the issuance of the show cause notice to an Assessee under Section 24 (1) DSTA was mandatory. It is not enough for the AA to merely reproduce the wording of the provision and state in the notice to an Assessee that there is "reason to believe" that the whole .....

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the present case.

Schedule 13 of the balance sheet produced by the Assessee clearly discloses the know-how fees in the sum of ₹ 400 lakhs. The extracted passage of the order clearly indicates that the Assessing Officer had perused the balance sheet and thereafter framed the assessment. Consequently, what in fact the AA did was to review his earlier order based on a change of opinion that the said sum of ₹ 400 lakhs ought to have been brought to tax. This course of action .....

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neet Agarwal and Mr Deepak Anand, Advocates For the Respondent : Mr Peeyoosh Kalra, Advocate with Mr Ankit Khurana, Advocate ORDER S. Muralidhar, J 1. This Appeal by the Assessee under Section 81 of the Delhi Value Added Tax Act, 2004 is directed against the order dated 21st August, 2014 passed by the Appellate Tribunal, Value Added Tax, Delhi ( Tribunal') in Appeal No. 88/ATVAT/09-10 for the Assessment year ( AY ) 2004-05. 2. The Assessee is engaged in the real estate promotion and developm .....

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lance sheet (balance sheet is consolidated), list of tax paid purchases, which have been test checked Dealer filed list of tax paid purchases for ₹ 6743217/- exemption of tax paid sales allowed on test check. No central sale. All other sales are taxable sales under local Act. There is no sale of asset during the assessment year. Assessment is as follows: GTO 18918250 Tax assessed 737914 ISS 0 Tax dep. 737627 RD Sale 0 Tax due 287 Tax paid sale 12275290 Interest 49 Tax free sale 0 Penalty 0 .....

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been assessed at a rate lower than the rate at which it was assessable/deduction has been wrongly under vide assessment order dated 31.03.2006 made under section 23 of the Delhi Sales Tax Act, 1975 . 5. Following the above notice, the re-assessment order was passed on 31st May, 2007 where it was observed that the above said dealer has received 400 lakh during 2004-2005 as Know-How fees. This turnover has escaped for assessment while assessing the dealer for the AY 2004-05. The said sum of ͅ .....

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sed upon statement of turnover - be completed on the ground that turnover had been assessed at a lower rate than what ought to have been originally done; (c) Could be Appellate Tribunal - VAT (ATVAT), in the circumstances of the case, have confirmed the demand as one relating to transfer of right to use the goods, which was not the case of the Revenue and if so, the correct rate of tax; (d) Was interest leviable on the date determined by the ATVAT or any other time? 8. The reassessment was sough .....

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veral decisions including the recent decision in Shruti Fasteners Ltd. v. Commissioner of Value Added Tax (decision dated 15th October, 2015 in Sales Tax Appeal No. 7/2010 ) has been complied with in the instant case. In the said decision this Court, after surveying the earlier cases that clarified the legal position held that the requirement of the AA having to record reasons to believe preceding the issuance of the show cause notice to an Assessee under Section 24 (1) DSTA was mandatory. It is .....

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re 'reasons to believe' that the whole or any part of the turnover has escaped assessment. 10. In response to the above query, Mr Peeyoosh Kalra, learned counsel for the Respondent fairly stated that there was no recording by the AA in the file, prior to the issuance of notice of reassessment, that there were "reasons to believe" that the whole or part of the turnover has escaped assessment for the assessment period in question. Therefore, the mandatory requirement of Section 2 .....

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