Patna High Court
Birla Corporation Ltd vs The State Of Bihar And Anr on 31 January, 2024
Bench: Chief Justice, Rajiv Roy
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.9612 of 2018
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Birla Corporation Ltd. and Regional Office at 301-303 Ashiana Towers,
Exhibition Road, Patna - 800003 through its Dy. General Manager,Accounts
and Taxation Kamlesh Chandra Chourasia, son of Late Sharda Prasad
Chourasia, resident of 1453, Kidwai Nagar, P.O. Allahpur, P.S. George Town
Allahabad.
... ... Petitioner/s
Versus
1. The State of Bihar through Commissioner of Commercial Taxes, Bihar,
Patna having its office at Vikas Bhawan, Patna.
2. Dy. Commissioner of Commercial Taxes, Special Circle, Patna.
... ... Respondent/s
======================================================
with
Civil Writ Jurisdiction Case No. 9613 of 2018
======================================================
Birla Corporation Ltd. and Regional Office at 301-303 Ashiana Towers,
Exhibition Road Patna - 800003 through its Dy. General Manager, Accounts
and Taxation Kamlesh Chandra Chourasia, son of Late Sharda Prasad
Chourasia resident of 1453, Kidwai Nagar, P.O. Allahpur, P.S. George Town
Allahabad.
... ... Petitioner/s
Versus
1. The State of Bihar through Commissioner of Commercial Taxes, Bihar,
Patna having its office at Vikas Bhawan, Patna.
2. Dy. Commissioner of Commercial Taxes, Special Circle, Patna.
... ... Respondent/s
======================================================
Appearance :
(In Civil Writ Jurisdiction Case No. 9612 of 2018)
For the Petitioner/s : Mr. D.V.Pathy, Advocate
For the Respondent/s : Mr. Vikash Kumar, SC-11
(In Civil Writ Jurisdiction Case No. 9613 of 2018)
For the Petitioner/s : Mr. D.V.Pathy, Advocate
For the Respondent/s : Mr. Vikash Kumar, SC-11
======================================================
CORAM: HONOURABLE THE CHIEF JUSTICE
and
HONOURABLE MR. JUSTICE RAJIV ROY
CAV JUDGMENT
(Per: HONOURABLE THE CHIEF JUSTICE)
Date : 06-02-2024
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
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The identical petitioner in the writ petitions
challenges the order of reassessment passed in the years 2005-
06 and 2006-07, as barred by limitation under Section 31 of the
Bihar Value Added Tax Act, 2005 (for brevity, the VAT Act),
which reassessment order was passed in the year 2018.
2. We have to first deal with the facts arising in the
individual cases. For the assessment year 2005-06, the
impugned notice dated 23.03.2018 issued by the Department for
reassessment is produced as Annexure-6. The petitioner had
filed its return for the period 2004-06 on the due date, and as per
the VAT Act, there is a self-assessment made unless it is taken
up for reassessment within the limitation period provided under
the statute.
3. The petitioner was issued with a show-cause
notice within the limitation period, based on an objection raised
on audit. The petitioner replied to the same and produced the
books of accounts before the Assessing Officer. The Assessing
Officer, respondent no. 2, after perusal of the records, found that
there is true and fair disclosure of the purchases and sales in the
books of accounts. The audit objection was found to be not
sustainable and an order was passed, produced as Annexure-1.
4. Again for the very same year, a notice was issued
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
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at Annexure-2, which was also responded to by production of
the books of accounts and an objection. The Assessing Officer
passed an order of reassessment on 31.12.2009, by Annexure-3
making additions. An appeal was filed wherein the assessment
order was set aside with a direction to consider the records de
novo as is produced at Annexure-4. Again, the Assessing Officer
passed an order produced as Annexure-5 dated 16.03.2017,
accepting the returns filed by the petitioner. It is after this that
the impugned notice was issued, produced as Annexure-6,
which was dated 23.03.2018, long after the limitation period.
5. Section 26 provides for a self-assessment of tax,
which is deemed on the returns being filed. This does not
preclude the Department from making a reassessment, which
can be as per Section 31. Section 31 provides that the prescribed
authority shall, in such manner as may be prescribed, proceed to
assess or reassess, as the case may be, the tax payable by such
dealer within four years from the expiry of the year during
which the original order of assessment or reassessment was
passed. The assessment, as was noticed, with respect to a dealer,
who has filed a return occurs automatically under Section 26
with power conferred on the prescribed authority to reassess it.
Insofar as a dealer, who has not filed a return, the prescribed
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
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authority has a power to make an assessment, which would be
the original assessment, and then also proceed for reassessment
on any of the ingredients under Section 31 arising.
6. In the assessment year 2005-06, as we noticed
earlier, there was a self-assessment under Section 26 and twice
reassessment was attempted, once on the basis of audit objection
and the other on finding some defect in the returns. The first
notice for reassessment was closed by the Assessing Officer
himself. The second attempt to reassesses also was closed after a
fresh consideration as directed in an appeal filed. Hence, insofar
as the petitioner is concerned, there is no reassessment carried
out and the limitation has to relate back to the original
assessment, which is the self-assessment made under Section
26, in which event, the reassessment now attempted as per
Annexure-6 is grossly delayed.
7. In the next writ petition, C.W.J.C. No. 9613 of
2018 concerned with assessment year 2006-07, the impugned
order is also dated 23.03.2018. In the said assessment year also
a proper return was filed within the due time, leading to a
self-assessment under Section 26. A notice was issued as seen
from Annexure-1 dated 22.06.2009, which was properly
responded to by an objection and production of books of
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
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accounts. A reassessment was made by Annexure-2, dated
28.02.2012
. An appeal was filed, which was allowed as per
Annexure-3, and on the remand made in the appeal, the
Assessing Officer accepted the returns filed by the petitioner, as
is seen from Annexure-4 dated 16.03.2017. The impugned
notice was issued subsequent to that, after the period of
limitation.
8. The interpretation of the provisions under
Sections 26 and 31, we made above for the assessment year
2005-06, squarely applies to the present year also.
9. We find absolutely no reason to permit the
Department to proceed with the assessment.
10. We are quite conscious of the fact that the
challenge in the writ petition is only against a show-cause notice
issued. However, it has to be noticed that the show-cause notice
is totally without jurisdiction since the limitation prescribed as
per the Statute has expired.
11. We also notice the contours of the jurisdiction
under Article 226 of the Constitution of India to interfere with
appellable orders laid down by the Hon'ble Supreme Court in
State of H.P & Ors. v. Gujarat Ambuja Cement Limited &
Anr.; (2005) 6 SCC 499. It has been held that if an assessee
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
approaches the High Court without availing the alternate
remedy, it should be ensured that the assessee has made out a
strong case or that there exist good grounds to invoke the
extraordinary jurisdiction. While reiterating that Article 226 of
the Constitution confers very wide powers on the High Court, it
was clarified that nonetheless the remedy of writ is an
absolutely discretionary remedy. The High Court, hence, can
always refuse the exercise of discretion if there is an adequate
and effective remedy elsewhere. The High Court can exercise
the power only if it comes to the conclusion, that there has been
breach of principles of natural justice or that due procedure
required for the decision has not been adopted. The High Court
would also interfere if it comes to a conclusion that there is
infringement of fundamental rights or where the orders and
proceeding are wholly without jurisdiction or when the vires of
an Act is challenged and when there is a clear abuse of process
of law.
12. Going by the aforesaid declaration, Article 226
can definitely be invoked by the assessee,
since the re-assessment notice is after the limitation period. The
writ petitions, hence, are allowed, and the
Assessing Officer-respondent no.2 in both the writ petitions is
Patna High Court CWJC No.9612 of 2018 dt.06-02-2024
restrained from proceeding against the assessee based on the
impugned show-cause notices.
(K. Vinod Chandran, CJ)
Rajiv Roy, J: I agree
(Rajiv Roy, J)
Aditya Ranjan/-
AFR/NAFR
CAV DATE 25.01.2024.
Uploading Date 06.02.2024.
Transmission Date
