Tajmahal Tobacco Company P.LTD vs. Assistant Commissioner

Facts

M/s. Tajmahal Tobacco Company P. Ltd. (Petitioner) filed a writ petition seeking to quash an order dated 26.07.2021 passed by the Assistant Commissioner of GST & Central Excise (1st Respondent) and a consequent bank attachment dated 28.07.2021 by the State Bank of India (2nd Respondent). The Petitioner alleged tax arrears of Rs. 14,94,150/- for the assessment year 2007-08. The 1st Respondent issued a Form U notice to the 2nd Respondent bank for recovery. The bank attached Rs. 8,75,886/- from the Petitioner's account. The Petitioner had previously filed a rectification petition under Section 84 of the TNVAT Act on 20.07.2021, which was pending when the recovery proceedings were initiated.

Held

The Court held that the limitation period for filing the rectification petition under Section 84 of the TNVAT Act was saved due to the pendency of earlier proceedings where the Petitioner had enjoyed a stay. The Court noted that the earlier proceedings concluded on 03.10.2019, and the Petitioner received the order copy on 15.07.2021, making the subsequent rectification petition filed on 20.07.2021 well within the extended time frame. Consequently, the Court directed the 1st Respondent to consider the Petitioner's rectification petition dated 20.07.2021 on merits and in accordance with law, after providing an opportunity of being heard to the Petitioner, within eight weeks from the date of receipt of the order. The Court also ordered that no further coercive steps would be taken against the Petitioner regarding the alleged arrears for the assessment year 2007-08 until the disposal of the rectification petition.

Key Issues

1. Whether the rectification petition filed by the petitioner under Section 84 of the TNVAT Act, dated 20.07.2021, is within the prescribed limitation period, considering the assessment year 2007-08 and the order passed on 24.04.2009. Petitioner's Contention: The Petitioner argued that the limitation period for filing the rectification petition should be extended due to the pendency of earlier writ petitions filed by them and others, which challenged the relevant provisions. These earlier petitions were decided on 03.10.2019, and the Petitioner received the order copy only on 15.07.2021. Therefore, the rectification petition filed on 20.07.2021 was within time, excluding the period of pendency of the earlier litigation. Revenue's Contention: The Revenue contended that under Section 84 of the TNVAT Act, a rectification petition must be filed within five years. Since the assessment year was 2007-08 and the order was passed in 2009, the petition filed in 2021 was beyond the five-year limitation period and therefore liable to be rejected.