M/S Piramal Petrolium PVT. LTD. Shyam Plaza vs. State Of Chhattisgarh

Held

The Court allowed the writ petitions. It held that the re-assessment proceedings initiated under Section 22(1) of the Chhattisgarh VAT Act, 2005, were unsustainable because no prior assessment order, as required under Section 21(1) of the Act, had been passed. The Court found that the issue was squarely covered by the Division Bench judgments in State Of Chhattisgarh Vs. M/s Tata Teleservices Limited and M/s Iron Junction Raipur, which were not disputed by the State in terms of the legal issue involved. The Court was of the firm view that under these circumstances, relegating the petitioner to the statutory alternative remedy would not be proper or justified. Therefore, the impugned orders passed by the Commercial Vat Tribunal, the Appellate Authorities, and the reassessment order were set aside and quashed. The ratio decidendi is that re-assessment proceedings under Section 22(1) of the VAT Act are invalid if initiated without a preceding assessment order under Section 21(1).

Facts

The petitioner, M/s Piramal Petrolium Pvt. Ltd., filed two writ petitions challenging orders passed by the Chhattisgarh Commercial Tax Tribunal, the Additional Commissioner of Commercial Tax, and the Assistant Commissioner of Commercial Tax. The Assistant Commissioner initiated re-assessment proceedings under the Chhattisgarh VAT Act, 2005, disallowing Input Tax Rebate (ITR) on GST purchases from certain companies, alleging they were bogus dealers who had not deposited collected tax. The petitioner's appeal to the Additional Commissioner and subsequent appeal to the Commercial Tax Tribunal were dismissed. The petitioner argued that the re-assessment proceedings were initiated under Section 22(1) of the VAT Act without a prior assessment order, which is unsustainable. The State raised objections regarding the maintainability of the writ petitions, citing the availability of an alternative statutory remedy of reference under Section 55, the petitioner's participation in the re-assessment proceedings, and the delay in filing the petitions.

Key Issues

1. Whether the re-assessment proceedings initiated under Section 22(1) of the Chhattisgarh VAT Act, 2005, are sustainable in the absence of a prior assessment order, as contended by the petitioner? 2. Whether the writ petitions are maintainable given the availability of an alternative statutory remedy of reference under Section 55 of the Chhattisgarh VAT Act, 2005, as argued by the State? 3. Whether the petitioner is estopped from challenging the assessment order as it participated in the re-assessment proceedings, a contention raised by the State? 4. Whether the writ petitions are barred by limitation, as argued by the State on the grounds of delay in filing the reference petition? Petitioner's Arguments: The petitioner contended that the re-assessment proceedings under Section 22(1) of the VAT Act were invalid as no prior assessment order existed. They relied on the Division Bench judgments of this High Court in State Of Chhattisgarh Vs. M/s Tata Teleservices Limited and M/s Iron Junction Raipur Vs Commissioner Of Commercial Tax, which reiterated the principle from the Tata Teleservices case. The petitioner argued that these judgments squarely cover the present cases and warrant allowing the petitions. State's Arguments: The State argued that the writ petitions were not maintainable due to the existence of an alternative statutory remedy of reference under Section 55. They also contended that the petitioner had participated in the re-assessment proceedings and moved for a fresh assessment, thus they cannot now raise jurisdictional objections. Furthermore, the State argued that the petitions were filed beyond the prescribed time for filing a reference petition under Section 55.