9911796707
TMI Blog2022 (8) TMI 697X X X X Extracts X X X X X X X X Extracts X X X X ..... itution of India, inter alia, contending that: (a) The assessment order vide Annexure-19 pursuant to notice dated 13.01.2022 in Form-E 32 for the tax periods from 1.4.2013 to 30.09.2015 is not tenable inasmuch as the assessment for the year 2013-14 is barred by limitation as envisaged in Section 10(1) of the said Act; and (b) On account of misconception and misunderstanding of Accounting Standard the assessing authority construed addition of Rs.6019,11,90,908/- shown in the balance sheet against Note-11 (Tangible Assets) for the year 2014-15 as if the entry of goods have been effected during said period. 3. The fact submitted by the petitioner and not disputed by the opponent reveals that by Order dated 08.01.2018 the audit assessment under Section 9C of the OET Act was passed by Joint Commissioner of Sales Tax, Angul Range, Angul pursuant to Audit Visit Report by raising a demand of Rs.9,03,81,036/- pertaining to the tax periods covering 01.04.2013 to 30.09.2015. The self-same person in the capacity of Additional Commissioner of Sales Tax of Angul Range has sought to invoke power under Section 10 contemplating reassessment for the said tax periods by issue of Notice dated 04. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that the purchase of plant and machinery has been made since 2009-10 and the said purchase of assets shown to have been capitalized in the Balance Sheet for the year 2014-15 are as per requirement of Accounting Standard. Amplifying such contention it has been explained that the capitalization of pre-operative expenses in the year plant got operational is in accordance with the provisions of the Companies Act, 2013 and in compliance of requirement of Accounting Standards being AS-10 (fixed assets) and AS-16 (borrowing costs) issued by the Institute of Chartered Accountants of India. It is submitted that the petitioner-company incurred capital work-in-progress expenses and project development cost during the period from the financial year 2009-10 to financial year 2013-14 towards construction/installation of the thermal power plant. 4.2. It is further elaborated that the power plant project normally takes several years in conceptualizing, designing, erection, installation and commissioning. The petitioner has incurred capital work-in-progress of Rs.5472,56,81,731/- during the periods from 2009-10 till 2013-14 towards construction of 2X600MW Thermal Power Plant. It is, theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arrangement as allowed by this Court. The reassessment proceeding, therefore, in respect of the tax periods from 01.04.2013 to 30.09.2015 is not permissible. 5. Mr. Sunil Mishra, learned Additional Standing Counsel for the CT&GST Organisation upon instruction submitted that the contention as to capitalization is in accordance with the provisions of the Companies Act, 2013 and in compliance of requirement of Accounting Standards being AS-10 (fixed assets) and AS-16 (borrowing costs) issued by the Institute of Chartered Accountants of India was never put forth by the petitioner-company before the Assessing Authority. He further submitted that even if this Court holds the assessment pertaining to 2013-14 has been hit by limitation period stipulated under Section 10 of the OET Act, it would have no impact on the determination of liability inasmuch as no part of turnover pertaining to 2013-14 has been taken into consideration in the impugned reassessment. 6. With regard to initiation of proceeding by issue of notice for reassessment for the tax periods from 01.04.2013 to 31.03.2014 it is pertinent to take note of sub-section (1) of Section 10 of the OET Act which reads as follows: " ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limitation as provided under Section 10(1) of the OET Act. 7. As regards the contention of the petitioner through its counsel that the subject-goods, i.e., plant and machinery, which were brought from outside into the local area during the period from 2009-10 till 2014-15 and subsequently capitalized in the year 2014-15, had already suffered entry tax, the same is subject to factual adjudication by the competent authority. 7.1. Refuting the said contention of the counsel for the petitioner, Mr. Sunil Mishra, learned Additional Standing Counsel (CT&GST Organisation) furnished a copy of instruction dated 22.07.2022 under the signature of the Assessing Authority wherein the following has been stated: "As regard point No.-2, I am to say that the contention now taken never raised before me at the time of adjudicating the case. In every occasion the person appearing on behalf of the dealer-company has challenged the jurisdiction of the assessing authority and objected that there is no material with the revenue which proves that there is no escapement of turnover. *** But as per the audited balance sheet in column No.-11 it has been categorically mentioned addition of plant and m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for ready reference: "3. Levy of tax.- (2) The tax leviable under this Act shall be paid by every dealer in scheduled goods or any other person who brings or causes to be brought into a local area such scheduled goods whether on his own account or on account of his principal or customer or takes delivery or is entitled to take delivery of such goods on such entry: Provided that no tax shall be levied under this Act on the entry of scheduled goods into a local area, if it is proved to the satisfaction of the assessing authority that such goods have already been subjected to entry tax or that the entry tax has been paid by any other person or dealer under this Act. Explanation.- Where the goods are taken delivery of on their entry into a local area or brought into the local area by a person other than a dealer, the dealer who takes delivery of the goods from such person or makes carriage of the goods shall be deemed to have brought or caused to have brought the goods into the local area." 7.6. It transpires from the aforesaid provision that onus lies on the assessee to satisfy the Assessing Authority by adducing evidence to the effect that subject-goods have already been s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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