Ms/ Rohtash Sweets And Fast Foods vs Dy. Commissioner Commercial Tax ...
2018 Latest Caselaw 4160 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

AFR
 
Court No. - 29 
 

 
Case :- WRIT TAX No. - 666 of 2017 
 

 
Petitioner :- Ms/ Rohtash Sweets And Fast Foods 
 
Respondent :- Dy. Commissioner Commercial Tax And 2 Ors. 
 
Counsel for Petitioner :- Suyash Agarwal 
 
Counsel for Respondent :- C.S.C. 
 

 
Hon'ble Pankaj Mithal,J. 

Hon'ble Pankaj Bhatia,J.

(Delivered by Hon'ble Pankaj Bhatia,J.)

Heard Sri Rakesh Ranjan Agrawal, learned Senior Counsel, assisted by Sri Ankur Agrawal, learned counsel appearing for the petitioner and Sri C.B. Tripathi, Special Counsel for Commercial Tax Department.

The present writ petition has been filed challenging the impugned order for Assessment Year 2013-14 U.P. and Assessment Year 2013-14 Entry Tax passed by the Deputy Commissioner, Commercial Tax, Sector-8, Meerut (respondent no. 1) both dated 28.10.2016 and served upon the petitioner on 13.9.2017.

The contention of the petitioner is that on the basis of the survey dated 27.6.2013, the Assessing Authority proposed to assess the petitioner for Assessment Year 2013-14 Entry Tax allegedly for the suppressed purchasers of sugar brought side from local area. Subsequently, for the Assessment Year 2013-14 U.P. and Assessment Year 2013-14 Entry Tax , the Assessing Officer passed an ex parte order on 31.7.2015 creating liability of Rs. 20,37,183/- and Rs. 2,10,000/- towards entry tax. The said assessment orders dated 31.7.2015 were reopened on the application of the petitioner, however, again on 29.3.2016, assessment orders were passed against the petitioners, as no opportunity of hearing was given to the petitioners prior to the passing of the order dated 29.3.2016, the same were reopened under Section 32 of the Uttar Pradesh Value Added Tax Act, 2008 by the order of the respondent no. 1 on 30.6.2016. After reopening the ex parte assessment order dated 30.6.2016, a show cause notice dated 28.9.2016 was served on the petitioner, calling upon the petitioner to appear before the respondent no. 1 along with entire books of accounts on 15.10.2016. In pursuance of the said show cause notice, the counsel for the petitioner appeared and made submissions, however, no orders were passed and, subsequently, on 13.9.2017, the petitioner was served with the assessment orders under Section 28(2) of the U.P. Value Added Tax Act and Section 9 sub-section 4 of the Entry Tax Act, the said orders dated 13.9.2017 are under challenge in the present writ petition and the main ground of challenge is that the same were passed after the expiry of period provided under section 28(2) of the U.P. Value Added Tax Act. It was stated and argued at the bar that the assessment orders are beyond the period of limitation prescribed under Section 29 sub-section 6 of the U.P. Value Added Tax Act. Section 29 sub-section 6 of the Value Added Tax Act is quoted as under:

(6) Where an order of assessment or re-assessment has been set aside by the assessing authority himself under section 32, a fresh order of assessment or re-assessment may be made before expiry of the assessment year in which such order of assessment or reassessment has been set aside:

Provided that if an order of assessment or re-assessment made ex parte is set aside on or after first day of October in any assessment year, fresh order of assessment or re-assessment may be made on or before thirtieth day of September of the assessment year succeeding the assessment year in which such ex parte order of assessment or re-assessment was set aside.

Provided further that where second or subsequent time any order of assessment or reassessment is made ex parte and where such second or subsequent ex parte order of assessment or reassessment is to be set aside and a fresh order of assessment or reassessment may be made within the time aforementioned when the first ex parte order is set aside.

The said section clearly stipulates that the fresh order of assessment or reassessment has to be passed before the expiry of the assessment year in which such order of assessment or reassessment has been set aside. In view of the fact that the ex parte assessment order was passed on 30.6.2016, the order of fresh assessment had to be made by 31.3.2017 on which date the limitation to pass the order would expire.

The submission by the petitioner further that the order served on the petitioner on 13.9.2017 was after a gap of about 11 months from the date of alleged assessment order. It was stated that the respondents have antedated the order only to get over the limitation and have subsequently put a date 28.10.2016 on the orders which was actually passed after the expiry of the limitation but was antedated only to overcome the limitation provided under Section 29 sub-section 6 of the U.P. Value Added Tax Act. It was further stated that all the other assessment orders passed by the respondents, were computer generated, which is clear from the perusal of the earlier orders passed in the case of the petitioners themselves from the bottom whereof it is clear that a computer code is depicted at the bottom of the said orders whereas in the order impugned the said computer code is missing which clearly demonstrates that antedated order has been passed only to overcome the limitation. It was further averred in the writ petition that no explanation has been offered by the Department as to why the order of assessment, if made prior to the expiry of limitation, was not served on the petitioner within a reasonable time and was actually served after about 11 months which further demonstrates the mala fide on behalf of the Department and gives strength to the averments that antedated order has been passed. The petitioner further relied upon Circular No. 1424 dated 23.4.2017 issued by the Commissioner, Commercial Tax wherein provision has been made for serving of all the orders under digital signatures by e-mail which would deemed to be valid service.

The respondents, in their counter affidavits filed before this Court, have stated that there was delay in the service of the impugned order which cannot be attributed to the Department as it was normal case of delay in service of the order. It has been further stated in the counter affidavit that normally the orders passed under Section 28(2) are not computer generated and it has been further stated that the orders were based on the same computer but off-line and it was not generated on-line. The respondents have alongwith counter affidavit annexed as Annexure-4 to the counter affidavit, a dispatch register showing the dispatches made, bare perusal of the said Annexure demonstrates only the date of the order and date of its service, it does not indicate the date of dispatch. However, the said register does not have any date wise orders which clearly reveals that no register of dispatch is maintained in the serial. The respondents have further argued that the question of service of the order is a disputed question of facts and cannot be examined in writ jurisdiction under Article 226 of the Constitution of India. The respondents have relied upon the judgements in the case of Shree Cement Ltd. vs. State of U.P. And another, 2013 NTN (Vol. 52)-130 and in case of M.S. Gopi Nath Anandhan, Meerut vs. Sales Tax Officer, Sector VI, Meerut, 1997 U.P.L.BC-494 whereas the petitioner has relied upon the judgment of the Hon'ble Supreme Court in the case of State of Andhra Pradesh vs. Ramakishtaiah and Co (S.C.), decided on 17.2.1994 wherein the Hon'ble Supreme Court has stated as under:

"We are of the opinion that the theory evolved by the High Court may not be really called for in the circumstances of the case. We are of the opinion that this appeal has to be dismissed on the ground urged by the assessee himself. As stated above, the order of the Deputy Commissioner is said to have been made on January 6, 1973, but it was served upon the assessee on November 21, 1973, i.e. precisely 10 1/2 months later. There is no explanation from the Deputy Commissioner why it was so delayed. If there had been a proper explanation, it would have been a different matter. But, in the absence of any explanation whatsoever, we must presume that the order was not made on the date it purports to have been made. It could have been made after the expiry of the pre3scribed four years' period. The civil appeal is accordingly dismissed. No costs."

The petitioner has fuhrer relied upon the judgement of the Andhra Pradesh High Court in case of Santhosh Builders vs. Deputy Commissioner of Commercial Taxes (CT), Nellore and others, {2013} 57 VST 186 (AP).

The petitioner has also relied upon a judgement of Allahabad High Court in the Case of Writ Tax No. 1054 of 2018 (M/s Ramky Infrastructure Limited vs. State of U.P. And two others) and other connected matters, decided on 1.11.2018 wherein this Court relied upon the decision of Hon'ble Supreme Court and following the same, have allowed the writ petitions and have held that there is a legitimate presumption, if the order is served after long delay and after an expiry of the limitation that the orders were passed after the expiry of the limitation only to get over the statutory limitation.

The present case is also clear on facts and there is no dispute with regard to the expiry of limitation for making the assessment i.e. 31.3.2017 under Section 29 sub-section 6 of the U.P. VAT Act and also the fact with that the same was served on 13.9.2017 after about 10 and half months of hearing of the case. Thus there being no dispute on the facts. The argument of the Standing Counsel is that this Court cannot go into those questions, is rejected. There is no explanation in the counter affidavit as to why the modes of service of the orders as prescribed under Rule 72 of the U.P. VAT Rules was not observed for serving of the order by the Department.

72. The service of any notice, summon or order under the Act or the rules may be affected by any of the following methods, namely:-

a) By sending scanned copy or electronically generated and digitally signed copy of the order or notice by e-mail or by facsimile message-

Where an order, notice or any communication is made electronically and addressed to the dealer by e-mail which is provided to the department by the dealer, then such order, notice or communication, shall be deemed to have been served on the addressee. For the purpose of this clause, the provisions of section 13 of the Information Technology Act, 2000 (Act no. 21 of 2000) shall be applicable.

(b) Service to be on dealer or person concerned in person when practicable or on his agent-

Wherever it is practicable service shall be made on the dealer or person concerned in person, unless he has an agent empowered to accept service, in which case service on such agent shall be sufficient.

(c) Service on agent by whom dealer or person concerned carries on business-

In a case relating to any business or work against a person who does not reside within the local limits of the jurisdiction of the authority from which the notice, summon or order is issued, service on any manager or agent, who at the time of service, personally carries on such business or work for such person within such limits, shall be deemed good service.

(d) Service on an adult member of dealer or concerned person's family-

Where in any case the dealer or person concerned is absent from his residence at the time when the service of notice, summon or order is sought to be affected at his residence and there is no likelihood of his being found at the residence within a reasonable time and he has no agent empowered to accept service of the notice, summon or order on his behalf, service may be made on any adult member of the family, whether male or female, who is residing with him.

Explanation:- A servant is not a member of the family within the meaning of this rule.

(e) Person served to sign acknowledgement-

Where the process server delivers or tenders a copy of the notice, order or summons to the dealer or person concerned personally, or to an agent or other person on his behalf, he shall require the signature of the person to whom the copy is so delivered or tendered to an acknowledgement of service endorsed on the original notice, order or summon.

(f) Procedure when dealer or person concerned refuses to accept or cannot be found-

Where dealer or concerned person or his agent or such other person as aforesaid refuses to sign the acknowledgement, or where the process server, after using all due and reasonable diligence, cannot find the dealer or person concerned who is absent from his place of business or residence at the time when service is sought to be affected on him and there is no likelihood of his being found within a reasonable time and there is no agent empowered to accept service of the notice or order or summon on his behalf, nor any other person on whom service can be made, the process server shall affix a copy of the notice, order or summon on the outer door or some other conspicuous place in the house in which the dealer or person concerned ordinarily resides or carries on business or personally works for gain and shall then return the original to the authority from which it was issued with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so and the name and address of the person (if any) by whom the house was identified and in whose presence the copy was affixed.

(g) Endorsement of time and manner of service-

The process server shall, in all cases in which the notice, order or summon has been served under clause(d), endorse or annex, or cause to be endorsed or annexed on or to the original notice, order or summon, a return sating the time when and the manner in which the notice, order or summon was served and the name and address of the person (if any) identifying the person served and witnessing the delivery or tender of the notice, order or summon.

(h) Examination of the process server-

Where a notice, order or summon is returned under clause (f), the authority shall, if the return under that rule has not been verified by the affidavit of the process server and may, if it has been so verified, examine the process server on oath or cause him to be so examined by another authority touching his proceedings and may make such further enquiry in the manner as it thinks fit and shall either declare that the notice, order or summon has been duly served or order such service as it thinks fit.

(i) Simultaneous issue of notice or order or summon for service by post in addition to personal service-

(i) The authority shall, in addition to, and simultaneously with the issue of notice, order or summon for service in the manner provided under this rule, also direct the notice, order or summon to be served by registered post, acknowledgement due addressed to the dealer or person concerned, or his agent empowered to accept the service, at the place where the dealer or person concerned or his agent actually and voluntarily resided or carries on business or personally works for gain:

Provided that nothing in this sub-clause shall require the authority to issue a notice, order or summon for service by registered post where in the circumstances of the case the authority considers it unnecessary.

(ii) when an acknowledgement purporting to be signed by the dealer or person concerned or his agent is received by the authority or the postal article containing the notice, order or summon is received back by the authority with an endorsement purporting to have been made by a postal employee to the effect that the dealer or person concerned or his agent had refused to take delivery of the postal article containing the notice, order or summon, when tendered to him, the authority issuing the notice, order or summon shall declare that the notice, order or summon had been duly served on the dealer or person concerned:

Provided that where the notice, order or summon was properly addressed, prepaid and duly sent by registered post, acknowledgement due, the declaration referred to this clause shall be made notwithstanding the fact that the acknowledgement having lost or misplaced, or for other reasons, has not been received by the authority within thirty days from the date of issue of the notice, order or summon.

(j) Substituted service-

(i) Where the authority is satisfied that there is reason to believe that the dealer or person concerned is keeping out of the way for the purpose of avoiding service or that for any other reason the notice, order or summon cannot be served in the ordinary way the authority shall order the notice, order or summon to be served by affixing a copy thereof in some conspicuous place in the office premises and also upon some conspicuous part of the house (if any) in which the dealer or person concerned is known to have last resided or carried on business or personally worked for gain or in such other manner as the authority thinks fit;

(ii) Where the authority acting under sub-clause (i) orders service by an advertisement in a newspaper, the newspaper shall be a daily newspaper circulating in the locality in which the dealer or person concerned is last known to have actually and voluntarily resided, carried on business or personally worked for gain;

iii) Effect of substituted service- Service substituted by the order of authority shall be as effectual as if it had been made on the dealer or concerned person;

iv) Time for appearance to be fixed-Where service is substituted by the order of authority, the authority shall fix such time for the appearance of the dealer or the concerned person as the case may require.

(k) Service of notice, order or summon where the dealer or person concerned resides within the jurisdiction of another authority-

A notice, order or summons may be sent by the authority by which it is issued, whether within or without the State, either by one of its process server or by post to any authority having jurisdiction in the place where the dealer or person concerned resides.

(l) Duty of authority to which notice, order or summon is sent-

The authority to which a notice, order or summons is sent under clause (k) shall, upon receipt thereof, proceed as if it has been issued by such authority and shall then return the notice, order or summons to the issuing authority, together with the record (if any) of its proceedings with regard thereto.

(m) Service on dealer or person concerned in prison

Where the dealer or person concerned is confined in a prison, the notice, order or summon shall be delivered or sent by post or otherwise to the officer in charge of the prison for service on the dealer or person concerned.

(n) Service on civil public officer or on servant of railway or local authority -

Where person concerned is a public officer (not belonging to the Indian Military, Naval or Air Forces), or is a servant of a railway or local authority, the authority may, if it appears to it that the notice, order or summon may be most conveniently so served, send it for service on the person concerned to the head of the officer in which he is employed together with a copy to be retained by the person concerned.

(o) Duty of a person to whom notice, order or summon is delivered or sent for service-

(i) Where a notice, order or summon is delivered or sent to any person for service under clause (m) or (n), such person shall be bound to serve it if possible, and to return it under his signature with the written acknowledgement of the dealer or person concerned and such signature shall be deemed to be evidence of service.

(ii) Where for any reason service is impossible, the notice, order or summon shall be returned to the authority with a full statement of such reason and of the steps taken to procure service, and such statement shall be deemed to be evidence of non-service.

(p) Substitution of letter for notice, order or summon-

(i) The authority may, notwithstanding anything hereinbefore contained, substitute for a notice, order or summons a letter signed by the authority where the dealer or person concerned is, in the opinion of the authority, of a rank entitling him to such mark of consideration;

(ii) A letter substituted under sub-clause(i) shall contain all the particulars required to be stated in a notice, order or summons, and subject to the provisions of sub-clause(iii), shall be treated in all respects as a notice, order or summons;

(iii) A letter so substituted may be sent to the dealer or person concerned by post or by a special messenger selected by the authority or in any other manner which the authority thinks fit and where the dealer or the concerned person has an agent empowered to accept service, the letter may be delivered or sent to such agent.

(q) The commissioner shall have power to the issue instructions regarding service of any notice, summon or order.

There being no explanation in the counter affidavit for non-observing any of the modes of service of order as prescribed under Rules and the Circulars the irresistible conclusion is that the order was antedated.

In view of the facts narrated above, we allow the writ petition and quash the impugned orders for Assessment Year 2013-14 U.P. and Assessment Year 2013-14 Entry Tax passed by the Deputy Commissioner, Commercial Tax, Sector-8, Meerut (respondent no. 1) both dated 28.10.2016 and served on 13.9.2017 as being beyond the prescribed period of limitation provided under Section 29 sub-section 6 of the U.P. Value Added Tax Act.

The writ petition is allowed in the aforesaid terms.

No order as to costs.

Order Date :- 6.12..2018/Puspendra