TMI Blog2017 (1) TMI 1220X X X X Extracts X X X X X X X X Extracts X X X X ..... ons 24 and 25, thus enabling extension of the period of completion of the assessment beyond the period specified in those Sections. Section 25(1) does not speak of any limitation for completion of the proceedings. In such circumstances, if at all extension of completion of assessment is permitted by the Deputy Commissioner, that would not enable the State to initiate proceedings after the limitation period is over nor can a limitation be found from the proviso - even if an extension is made under Section 25B, the same would not enable the State to initiate proceedings after expiry of the period of limitation provided under sub section (1) of Section 25 of the Act. The power of extension granted under Section 25B having been found to be redundant, there can be no limitation for conclusion of the proceedings and as the Full bench held, there can only be a mandate that the proceeding should be completed within a reasonable time - petition dismissed - decided against petitioner. - WP (C). No. 21077 of 2016 (H) - - - Dated:- 5-1-2017 - K. Vinod Chandran, J. For the Petitioner : Sri Jose Jacob For the Respondent : Sri V. K. Shamsudheen JUDGMENT The petitioner i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is based on the third proviso which reads as under: Provided also that the period for the completion of assessments including those subjected to extension under Section 25B which expires on 31st March, 2015 shall be extended upto 31st March, 2016 . The above proviso was first introduced in the year 2010 extending the time for completion of assessments for the year 2005-2006 upto 31.03.2011 and then of each successive year from 2005-2006 to the close of the current assessment year, by successive amendments. In such circumstance, it is contended that after 2010 at least there should be a limitation for conclusion of the proceedings; as per the third proviso as declared by the Full Bench. 6. The reliance is also on the following statement made by the Full Bench in the decision in Cholayil (supra): All these taken together, the net effect of the introduction of the third proviso to sub-section (1) of section 25 and the inclusion of section 25 within the canopy of section 25B is indicative of the fact that for all intents and purposes, the Legislature fixed an outer time-limit for completion of assessment proceedings under sub-section (1) of section 25, at least, in ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other (Para 10). 10. In Abdul Jabar Butt vs. State of Jammu and Kashmir - 1957 SCR 51 a Constitution Bench held so: In the first place it is a fundamental rule of construction that a proviso must be considered with relation to the principal matter to which it stands as a proviso (Para 8). 11. 'Interpretation of Statutes' by Prof.D.S.Chopra [First Edition] in Chapter III at page 135; describes the function of a proviso to be: intended to limit the enacted provision so as to exempt something which would have otherwise been within it or in some measure to modify the enacting clause. 12. The principle in Madras and Southern Maharatta Railway Co. (supra) was reiterated in Commr. of Income Tax, Mysore vs. Indo Mercantile Bank Ltd. -1959 Supp (2) SCR 256 = AIR 1959 SC 713 where it was held that : The proper function of a proviso was merely to qualify the generality of the main enactment by providing an exception an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he proviso, as employed here, cannot be deemed to provide for a limitation. The limitation provided in Section 25(1) of the Act is for initiation of proceedings and not completion of assessment. The extension enabled for completion of assessment, hence, is inoperative and neither saves limitation provided in Section 25(1) or provides for a limitation as such. 16. In that context, Section 25B has to be specifically referred to: 25B. Extension of period of limitation for assessments in certain cases. - Notwithstanding anything contained in section 24 or in section 25, in cases where any investigation or inquiry is pending under this Act or any other law or where any assessment cannot be completed within the period specified under the said sections, the Deputy Commissioner may, for good and sufficient reasons, extend the period of completion of the assessment beyond the period specified in those sections. 17. The language of Section 25B specifically refers to extension of period of completion, beyond the 'period specified in those sections' meaning sections 24 and 25. While section 24 prescribes a limitation period of three years to reject the return and complete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be noticed that Section 25(1) of the K.V.A.T. Act does not speak of any period for completion of assessment and if a proceeding was initiated prior to the limitation period, then going by the Full Bench decision, there would only be a mandate on the department to complete the assessment within a reasonable period, which, again is not a statutory mandate. Without having initiated the proceedings within the limitation period, the consequence of the limitation cannot be averted by extending the period of completion, for which no limitation is provided for in the statute. In such circumstance, it has to be held that the proceedings initiated herein, by Ext.P1 dated 12.08.2014, is far beyond the limitation period and the same cannot be sustained. 20. W.P. (C) No. 21184 of 2016 also did not find anything to the contrary. The reliance placed by the learned counsel for the petitioner is on the statement made in paragraph 21 of the judgment: Therefore, assessment starts from the time when notice is issued under Section 25 (1) of KVAT Act and it is completed when assessment orders are passed. Issuance of notice is the first stage of initiating the assessment proceedings, however a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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