The High Court of Orissa, in a revision petition, framed and answered two points regarding tax reassessment and penalty. The Court held that since the reversal of Input Tax Credit was prompted by an audit that exceeded the statutory period for filing revised returns, the demand was sustainable.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF ORISSA AT CUTTACK
STREV No.9 of 2016
M/s. Laxmi Narayan Bhandar, Cuttack …. Petitioner
Mr. Sumit Lal, Advocate
-versus-
State of Odisha
…. Opposite Party Mr. S.K. Pradhan, ASC
CORAM: THE CHIEF JUSTICE
JUSTICE M. S. RAMAN
ORDER
07.12.2022
Order No.
“(1) Whether in the facts and circumstances of the case, the learned Authorities below are justified in not accepting the reversal made by the Petitioner in the returns when the same were submitted prior to reassessment and determining the CTO and TTO without giving credit to the tax paid upon such reversal?
(2) Whether in the facts and circumstances of the case, the learned Authorities below are justified in levying penalty in absence of any finding with regard to the malafide intention of the Petitioner to evade or avoid tax or any allegation with regard to suppression of purchase or sales or both or contravention of any provisions of Act?”
Page 1 of 2
filed beyond the statutory limitation period of three months as provided under Section 33 (4) of the Odisha Value Added Tax Act, 2004 (OVAT Act). The proviso to Section 33(5) of the OVAT Act imposes a bar on accepting voluntary disclosure which is made “after receipt of the notice for tax audit under this Act, or as a result of such audit”.
3. In the present case, the wrongful ITC was detected in course of audit and it is only the result of such audit report that the Petitioner sought to reverse the ITC wrongfully claimed by filing the revised returns. Consequently, on a combined reading of Section 33(4) and Section 33(5) of the OVAT Act, it is plain that the Authorities could not have accepted the reversal of the ITC wrongfully claimed by the Petitioner. In other words, the impugned order of the Tribunal upholding the demand does not call for interference. Question (1) is, accordingly, answered in the affirmative, i.e., in favour of the Department and against the Assessee.
4. In view of the answer to question (1), question (2) is also answered in favour of the Department and against the Assessee.
5. The revision petition is, accordingly, dismissed.
Chief Justice
Judge
MRS/Laxmikant
Page 2 of 2
2 issues framed by the court
Whether the Assessing Authority was justified in not accepting the reversal of Input Tax Credit in the returns.
Whether the Assessing Authority was justified in levying penalty in absence of any finding with regard to malafide intention of the Petitioner.
2 provisions across 1 enactments
M/s. Laxmi Narayan Bhandar, Cuttack
State of Odisha
Justice M. S. Raman
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
