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TMI Blog2018 (12) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... d the right to operate. The assessments are with respect to the works contract executed by the assessee. The assessments, subject matter of W. A. No. 961/2015, are of the years 1999-2000, 2000-2001 and 2001-2002. 2. The assessment orders for all the three years were challenged in W. P. (C) No. 28084/2008. W. P. (C) No. 12748/2010 was filed seeking refund of the amounts paid at the time of admission of W. A. No. 1023/2008, which was disposed of by Ext. P2. The claim in both the Writ Petitions were that the assessee was entitled to compounding, which they had applied for, to the specific contract; in all the three years and hence there should be a refund from the amounts paid on the basis of an estimation made of the toll charges, which could have been collected on operation of the toll for a period of 19 years. 3. The learned Single Judge considered the issue for all the years and found that for the years 1999-2000 and 2000-2001 the assessee is entitled to compounding and quashed Exts. P3, P6, P6(a), P6(b) and P7 orders produced in W. P. (C) No. 28084/2008. Ext. P3 is the order passed by the Deputy Commissioner (Commercial Taxes), Mattancherry exercising powers of suo motu revisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith reference to the original contract, design and technical details; after collecting the rates and tariff from various Governmental authorities involved in civil work of construction of bridges. The assessee was also given liberty to furnish materials to facilitate a reasonable estimation of value of materials supplied in the execution of the work. W. P. (C) No. 28084/2008 in which the claim was for consideration of assessment under the compounding scheme was rejected finding the assessee was not entitled to compounding under Section 7 of the KGST Act. The assessee filed S. L. P's. from the common order. The S.L.P. filed against W. A. No. 1023/2008 was dismissed by order dated 01. 02. 2010 in S. L. P. No. 9691/2009. However, the S.L.P. filed against the judgment arising from the Writ Petition was converted to a Civil Appeal bearing C.A. No. 432/2010. Therein, there was a remand made directing fresh consideration of the Writ Petition, uninfluenced by the decision of the Division Bench in W. A. No. 1023/2008. 5. The issue arising is insofar as the assessments for the years 1999-2000 and 2000-2001, which the learned Single Judge directed to be taken up under the compounding sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en from the assessment order. The direction was only for denovo disposal, in accordance with law. Hence, if there is any short-fall of turnover, necessarily, the AO would have to take into account such short-fall and after hearing the assessee and also considering the objections, he has to again pass a fresh assessment order under the compounding scheme. The compounding permission as such having not been interfered with by the Deputy Commissioner under Section 35, the State cannot contend that the AO would have to proceed under the regular assessment. 7. M. P. Raju (supra) was a case in which a civil contractor filed an application for compounding before the assessing authority even before getting registration under the KGST Act. The assessing authority rejected the application, which was interfered with by the first appellate authority directing the assessing authority to accept payment made by the assessee as per Section 7(7) of the KGST Act. The Tribunal reversed the findings against which the assessee filed a revision before this Court. The Division Bench relied on Rule 30A of the Rules of 1963 providing the procedure for making an application by a civil contractor. Sub-Rule ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion filed and merely because an officer of the Department had accepted tax at the compounded rate, there cannot be found a permission having been granted by the Department. 10. In the present case, it is not clear from the assessment order as to the date on which the application for compounding was filed in the year 1999-2000. Further, the application stood allowed by the AO when the assessment order was passed in the year 2004. There was admittedly payment before the AO of the tax at the compounded rate on receipts by the assessee. What distinguishes the present case from the decisions cited by learned Senior Government Pleader, is the fact that here the AO had allowed an application for compounding. The Deputy Commissioner, invoking powers of suo motu revision had merely directed denovo assessment for reason of audited balance-sheet having not been filed and there being a shortfall of turnover. Denovo assessment can only be under the compounding scheme/provision, since admittedly tax was paid at the compounded rate and in any event, atleast, at the time of assessment the application for compounding was allowed by the AO; which was not the subject of suo motu revision. 11. With ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct is continued, is the compelling argument. 13. The Forms relevant to Rule 30A are Form Nos. 21B and 21BA. The application has to be made in Form No. 21B and permission is granted in Form No. 21BA. The contention of the assessee is that the provisions of Rule 30A and the Forms prescribed has to be looked at in juxtaposition with Rule 30 and the Forms prescribed thereunder. Rule 30 prescribes the procedure when the payment of tax at compounding rates is applied under Section 7 of the Act by any dealer other than a works contractor. For the works contractors applying under Sub-section (7) of Section 7, a specific prescription is brought in Rule 30A. In contrast, sub-rule (1) of Rule 30 speaks of an application to be filed at the commencement of the year, at least before the first of May of that assessment year. Form Nos. 21 and 21A also indicate that the permission is granted for a specific period; mostly the assessment year. Rule 30 and the Forms prescribed thereunder are period specific; while Rule 30A and the Forms prescribed thereunder are contract specific, is the contention of the assessee, which we are inclined to accept. If that be so, when the compounding has been applied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Senior Government Pleader, across the bar. We see that the assessee in the aforesaid proceedings had taken two contentions before the learned Single Judge,- one of limitation and the other of violation of principles of natural justice, insofar as no hearing having been afforded. On the question of limitation, the assessee conceded that it was within time, before the Division Bench. On the question of violation of principles of natural justice, the assessee was relegated to the alternative remedy finding it to be a mixed question of law and facts. We are of the opinion that this does not preclude us from considering afresh the issue. Here there is a new ground raised of the compounding of the contract having been allowed in the earlier order. When we have found that the specific contract has been permitted compounding in the previous year, necessarily, the said benefit shall enure to the assessee in the subsequent year also in which the contract has been carried on. As we noticed herein above, we would have allowed the compounding in the next year also, but for the fact that the assessee has not filed an appeal from the judgment of the learned Single Judge. 17. The assessments as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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