Allowed

M/S Oriental Cuisines Pvt. Ltd. v. the Deputy Commissioner of Commercial Taxes

Karnataka HC22 Sept 2022WP/4262/2020

Case brief

AI extract

What is this about?

The High Court allowed a writ petition filed by a dealer seeking to quash a reassessment order and demand notice. The court held that the reassessment order including a period prior to the cancellation of the Composition Scheme was illegal and set aside the order, declaring the petitioner not liable for VAT during that period.

What did the court decide?

Set aside the impugned reassessment order and demand notice; declare petitioner not liable for VAT from April 2015 to July 2015.

M/S Oriental Cuisines Pvt. Ltd. Vs the Deputy… — Banking and Recovery | Karnataka HC (2022)

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¹

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IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 22^ND DAY OF SEPTEMBER, 2022

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BEFORE

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THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No. 4262 OF 2020(T-RES)

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BETWEEN:

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M/S. ORIENTAL CUISINES PVT.LTD., NO.1 CLARK ROAD RICHARDS TOWN BANGALORE – 560 005. REPRESENTED BY ITS SECURITY MANAGER.

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…PETITIONER

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(BY SMT. RADHIKA SHRIRANJINI.M.D., ADVOCATE)

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AND:

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THE DEPUTY COMMISSIONER OF COMMERCIAL TAXES (AUDIT-5.5), D.V.O.5, V.T.K.2,5^TH FLOOR KORAMANGALA, BENGALURU – 560 047.

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(BY SRI. HEMA KUMAR., AGA)

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…RESPONDENT *****

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE REASSESSMENT ORDER DATED: 31.10.2019 IN ANNEXURE-G AND THE DEMAND NOTICE DATED: 31.10.2019 ISSUED DEMANDING PAYMENTS OF RS.1,00,17,141/- FOR THE YEAR 2015-16 ANNEXURE-H PASSED BY THE DEPUTY COMMISSIONER OF COMMERCIAL TAZES (AUDIT-5.5),KORAMANGALA, BANGALORE FOR THE YEAR 2015-16 IS BEING CONTRARY TO SECTION 15(1) OF THE KARNATAKA VALUE ADDED TAX ACT, 2003 AND ETC.

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THIS W.P. COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:-

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²

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ORDER

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In this petition, petitioner has sought for the following

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reliefs:-

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“a. Issue a Writ of Certiorari to quash the reassessment order dated 31.10.2019 in No.DCCT/AUDIT-5.5/VAT/2015-16-Annexure-G and the demand notice dated 31.10.2019 issued demanding payments of Rs.1,00,17,141/- for the year 2015-16 – ANNEXURE-H passed by the Deputy Commissioner of Commercial Taxes (Audit-5.5), Koramangala, Bangalore for the year 2015-16 is being contrary to Section 15(1) of the Karnataka Value Added Tax Act, 2003 and

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b. Writ of Mandamus or appropriate direction to the Deputy Commissioner of Commercial Taxes (Audit-5.5), Koramangala, Bangalore not to enforce Form VAT 180 till the time of disposal of this writ petition and to apply the actual meaning of Section 15(1) of the Karnataka VAT Act, 2003 and direct him not to travel beyond the scope of the provisions of the Act, and

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c. Grant such other relief or reliefs as this Hon’ble Court may deem fit in the circumstances of the case, in the interest of justice and equity”.

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Heard learned counsel for the petitioner, learned AGA for the respondent and perused the material on record.

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³

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In addition to reiterating the various

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contentions urged in the memorandum of petition and referring to the material on record, learned counsel for the petitioner submits that the Composition Scheme Facility (COT) that was granted by the respondent in favour of the petitioner was cancelled vide Notice dated 22.07.2015 w.e.f. 01.08.2015. It is submitted that the said cancellation of COT of the petitioner was prospective and not retrospective for any period prior to 01.08.2015. Despite this, the respondents have passed the impugned reassessment order dated 31.10.2019 under the KVAT Act, 2003 for the assessment year 2015-16 levying higher rates of tax, interest and penalty and issued the Demand notice demanding payment from the petitioner, who is before this Court by way of the present petition.

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3.1 It is further submitted that the petitioner has paid VAT for the period from January 2011 to March, 2015 and the impugned order calling upon the petitioner to pay VAT from April 2015 to July 2015 is illegal, arbitrary and deserves to be quashed. It is also pointed out that in relation to the assessment year 2014-15, the reassessment

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⁴

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order dated 04.10.2016 passed by the respondent in relation to the petitioner was quashed by this Court in W.P.Nos.57182-193/2016 dated 02.04.2018 and consequently, the said order applies in respect of the petitioner for the instant assessment year 2015-16 also and as such, the impugned reassessment order and demand notice deserve to be quashed on this ground also.

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Per contra, learned AGA for the respondent submits that there is no merit in the petition and the same is liable to be dismissed.

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As rightly contended by the learned counsel for the petitioner, a perusal of the COT cancellation order dated 22.07.2015 (Annexure-C) will clearly indicate that the same is prospective w.e.f. 01.08.2015 and not retrospective and the same will not apply for the period prior to 01.08.2015. In this context, a perusal of the impugned order at Annexure-G dated 31.10.2019 will indicate that the period from April, 2015 to July, 2015 has also been taken into account by the respondent to compute the tax liability, interest and penalty allegedly payable by the petitioner.

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⁵

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Further, in W.P.Nos. 57182-193/2016 dated 02.04.2018 preferred by the petitioner herein in relation to the assessment year 2014-15, the reassessment order dated 04.10.2016 which was impugned in the said petition was quashed by the co-ordinate Bench of this Court and the same order has attained finality and become conclusive and binding upon the petitioner. It is also seen that the petitioner has paid VAT for the period from January, 2011 to March, 2015 and he is not liable to pay any VAT for the said period.

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Under these circumstances, I am of the considered opinion that the impugned order and demand notice deserve to be set aside and the matter be remitted back to the respondent for reconsideration afresh in accordance with law by declaring that the petitioner is not liable to pay VAT from April, 2015 to July, 2015.

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In the result, I pass the following:-

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ORDER

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(i) The petition is hereby allowed.

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⁶

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(ii) The impugned re-assessment order dated

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31.10.2019 at Annexure-G and the impugned demand notice dated 31.10.2019 at Annexure-H passed by the respondent are hereby set aside.

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(iii) It is declared that the petitioner is not liable to pay Value Added Tax (VAT) from April 2015 to July-2015.

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(iv) Respondent is directed to reconsider the matter afresh in accordance with law bearing in mind the observations made in this order.

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JUDGE

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Bmc/Srl.

M/S Oriental Cuisines Pvt. Ltd. v. the Deputy Commissioner of Commercial Taxes

Case brief

What is this about?

What did the court decide?

M/S Oriental Cuisines Pvt. Ltd. v. the Deputy Commissioner of Commercial Taxes

Case brief

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What did the court decide?

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