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2016 (9) TMI 969 - MADRAS HIGH COURT

2016 (9) TMI 969 - MADRAS HIGH COURT - TMI - Rejection of settlement application under Section 6(3) of the Settlement Act - settlement of arrears of Sales Tax - Tamil Nadu Sales Tax (Settlement of Arrears) Act, 2010 - applications filed by petitioner under the Settlement Act, dated 30.12.2010 - applications filed by the petitioner were put in cold storage by the competent authority - after about five years show cause notices issued to the petitioner for the assessment years 1997-1998 and 1991-19 .....

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was a statutory duty on the part of the Assessing Officer to pass the revised assessment orders and for reasons best known, the Assessing Officer has not done so, therefore, the dealer cannot be blamed for the inaction on the part of the Assessing Officer, therefore, the designated authority under the Settlement Act should call for entire files or in the alternative direct the Assessing Officer to pass revised assessment orders in terms of the orders passed by the Appellate Authority and thereaf .....

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t Pleader, accepting notice on behalf of the respondents and with the consent of learned counsel appearing on either side, these Writ Petitions are taken up for final disposal. 2. Since the issue involved in both Writ Petitions are identical, Writ Petitions are disposed of by a common order. 3. The petitioner is a registered dealer under the provisions of the Tamil Nadu General Sales Tax Act, 1959 (TNGST Act). The assessment for the years 1997-1998 and 1991-1992 were completed by orders of asses .....

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e petitioner filed applications under the Settlement Act, dated 30.12.2010. The applications filed by the petitioner were put in cold storage by the competent authority under the Settlement Act, viz., the 3rd respondent and after about five years show cause notices were issued to the petitioner for the assessment years 1997-1998 and 1991-1992, dated 19.12.2015 and 11.01.2016 stating that the petitioner has not paid 90% of the amount payable under Section 7 of the Act along with the applications .....

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etitioner stated that revised assessment orders of the Assessing Officer have not been received by them and the Assessing Officer ought to have given effect to the orders of the Appellate Assistant Commissioner (C.T)-III and passed revised assessment orders and the Assessing Officer having not done so, the petitioner cannot be blamed. The 3rd respondent after about six months from the date of receipt of the objections filed by the petitioner has rejected the applications by the impugned orders o .....

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ons filed before the Madurai Bench of this Court in W.P.(MD) Nos. 5638 to 8415 of 2014 etc. batch, wherein, among other issues, the issue as to whether the applications under the Settlement Act could be rejected on the grounds as stated in the impugned orders was also considered. In fact, in the said order, this Court after taking note of the provisions of the Act elaborated upon the procedure to be adopted by the designated authority under the Act while examining an application under the Settle .....

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lause (a) deals with the cases relating to best of judgment assessment for non-production of accounts; Clause (b) deals with non-filing of declaration forms, which arise under the provisions of CST Act; Clause (c) relates to arrears of tax, which has been admitted as tax due as per the returns filed for the year with corresponding arrears of penalty and interest and Clause (d) relates to arrears of penalty or interest or both and where there is no corresponding arrears of tax pending collection .....

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of the application to the said authority in terms of Section 5(3). Therefore, at the first instance, the onus lies on the dealer/applicant to determine the payment payable under Section 7. We have noticed that under Section 7, it is a rate applicable for determining the amount payable, which at the first instance is on the dealer/applicant. In terms of Section 6(1), the designated authority is bound to verify the correctness of the particulars furnished in the application made under Section 5 w .....

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6, which states that if the amount paid by the applicant along with application (in terms of Section 7) falls short of not more than 10% of the amount determined under sub-section (1), then and then alone the question of demanding further amount under Section 6(2) would arise. If the applicant failed to fulfill the conditions under sub-section (2) of Section 6, his application stands summarily rejected in terms of sub-section (3) of Section 6. Thus, the Act being a Settlement Act to give reprie .....

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vant records, finds that further amount is payable and if the same fall short of not more than 10% grant relief to the dealer and if not the application stands summarily rejected. Therefore, the Act operates on strict limits as clearly defined under the Statute. The onus is not only on the dealer to carefully peruse all his records and relevant documents while determining the rate payable by him, but also on the assessing officer while verifying the application as to the correctness of the parti .....

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tion 8 of the Act deals with settlement of arrears and issuance of certificate. If the authority is satisfied about the payment of amount determined under Section 6(1), by an order, settle the arrears of tax, penalty or interest and issue a certificate in such form as may be prescribed, and thereupon the applicant shall be discharged from his liability or interest. In terms of sub-section (2) to Section 8, the designated authority, for reasons, to be recorded in writing, may refuse to settle the .....

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itled to certificate under Section 8(1) has to first satisfy the designated authority about the payment of the amount determined under sub-section (1) to Section 6. Even if the applicant satisfies such requirements, still the designated authority has power to refuse to settle the arrears of tax, penalty or interest by recording reasons in writing after issuing show-cause notice. 6. With regard to the issue as to how the applications have to be dealt with when appeals are pending, it was held in .....

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ote that this Court in the case of Anitha Plastics (cited supra) held that the petitioner could not be deprived of the benefit merely because the order was passed after remand. As a matter of fact, the fresh order passed after remand, should be taken to have been passed, only because of the appellate authority finding fault with the original order. In such circumstances, the benefit of the scheme could not be denied to the petitioner and the said decision has also been followed in the case of M/ .....

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