M/S Vishal Udyog vs. The State Of Assam And 3 Ors

Held

The Court held that the assessment orders for the assessment years 2012-13 and 2013-14 were liable to be set aside. The Court noted that while the period stipulated under Section 39 of the Act ended on 31.03.2018 and 31.03.2019 for these years, the demand notices were issued in July and August 2019. The Court found no explanation on record for this delay of over two years. Citing the Supreme Court's judgment in M. Ramakishtaiah and Company, the Court concluded that in the absence of any explanation for the delay, it must be presumed that the assessment orders were not made on the dates they purported to be (21.12.2017), but could have been made after the expiry of the prescribed period. Consequently, the assessment orders for the period 2012-13 and 2013-14 were set aside. The Court also set aside and quashed the assessment orders dated 21.12.2017 and 24.06.2019, along with the demand notices dated 10.08.2019, 02.07.2019, and 01.07.2019.

Facts

The petitioner, M/s Vishal Udyog, a proprietorship concern registered under the Assam Value Added Tax Act, 2003, filed writ petitions challenging assessment orders and demand notices issued by the Superintendent of Taxes, Unit-C, Guwahati. For the financial year 2013-2014, the petitioner's return was subjected to scrutiny assessment, resulting in a demand for interest and penalty. Subsequently, a notice under Section 36 of the Act was issued for audit assessment for periods 2012-13 to 2014-15. The petitioner appeared and produced documents. A demand notice dated 27.12.2018, issued on 01.07.2019, demanded Rs. 22,599/- for the assessment year 2013-14. The petitioner applied for a certified copy of the assessment order dated 21.12.2017, which was received on 20.09.2021. The assessment order did not allow Input Tax Credit. A similar issue arose for the financial year 2014-15, where scrutiny assessment led to a demand for interest and penalty, which was paid.

Key Issues

1. Whether the assessment orders for the assessment years 2012-13 and 2013-14 are liable to be set aside on the ground that they were passed after the expiry of the prescribed period, as evidenced by the delay in issuing demand notices? The Petitioner argued that the demand notices for the assessment years 2012-13 and 2013-14 were issued in July and August 2019, significantly after the period stipulated under Section 39 of the Act, which ended on 31.03.2018 and 31.03.2019 respectively. The Petitioner contended that there was no explanation for this delay, and following the Supreme Court's decision in M. Ramakishtaiah and Company, such delay creates a presumption that the orders were not made on the dates they purported to be, but rather after the expiry of the prescribed period. The Petitioner relied on the principle that orders must be communicated within a reasonable period. The Respondent State did not record any specific arguments on this point.