Allowed

M/S.Vedanta Ltd. v. Joint Commissioner of Sales Tax

Orissa HC17 Apr 2023WP(C)/5540/2016

Case brief

AI extract

What is this about?

The High Court of Orissa allowed the writ petition challenging the legality of an assessment order dated 04.02.2016. The Court held that the escaped assessment under Section 43 of the OVAT Act was unauthorized as it was passed without a prior completed assessment order under Section 39, rendering the proceeding illegal.

What did the court decide?

The impugned order dated 04.02.2016 under Section 43 of the OVAT Act is set aside, and the writ petition is allowed and disposed of.

M/S.Vedanta Ltd. Vs Joint Commissioner… — Constitutional and Fundamental Rights | Orissa HC (2023)

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IN THE HIGH COURT OF ORISSA AT CUTTACK

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W.P.(C) No. 5540 of 2016

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M/s. Vedanta Ltd.

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….. Petitioner Mr. S.C. Sahoo, Adv.

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Vs.

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….. Joint Commissioner of Sales Tax Opp. Parties & Others Mr. S.S. Padhy, A.S.C. (for CT & GST)

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CORAM:

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JUSTICE S.TALAPATRA JUSTICE SAVITRI RATHO

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ORDER 17.04.2023

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Order No.

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05. 1. This matter is taken up through hybrid mode.

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Heard Mr. S.C. Sahoo, learned counsel appearing for the

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Petitioner and also Mr. S.S. Padhy, learned Addl. Standing Counsel for CT and GST appearing for the Opposite Parties.

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By means of this writ petition, the petitioner has challenged the legality of the assessment order dated 04.02.2016 passed by the Joint Commissioner of Sales Tax, Orissa, 2004 which has been passed without passing any order under Section 39 of the OVAT Act and as such the pre-condition for initiation of proceeding under Section 43 of the OVAT Act was non-existent. Therefore, the escaped assessment as taken by the Joint Commissioner of Sales Tax is totally unauthorized and beyond scope of the statute.

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Mr. Sahoo, learned counsel has contended that the said issue

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Page 1 of 3

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is no more res-integra, in view of the decision of this Court in M/s.

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Jayshree Chemicalas Ltd. Vs. State of Orissa [the order dated 29.12.2008 in W.P.(C) No. 2777 of 2008]. In M/s. Jayshree Chemicals Ltd. (supra), it has been held as under:

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“Apart from that, the concept of escaped assessment under Section 43 of the Orissa Value Added Tax Act comes into play only when the assessment has been made and completed.

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In the instant case, without assessment being complete, the notice of escaped assessment is misconceived and as such the said notice under Anneuxre-1 is quashed.”

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Mr. Sahoo, learned counsel has also referred a decision of this Court in M/s. Keshab Automobiles Vs. State of Odisha [Judgment dated 01.12.2021 delivered in STREV No. 64 of 2016] where the said law has been re-stated by this Court. That apart Mr. Sahoo, learned counsel has placed his reliance one order on affirmation of the Apex Court: In Deputy Commissioner of Sales Tax Vs. M/s.

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Rathi Steel and Power Ltd. [the order dated 13.07.2022 delivered in SLP(C) No. 9912 of 2022]. It has been observed by the Apex Court

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in M/s. Rathi Steel and Power Ltd. (supra) that Section 43(1) of the OVAT Act, 2004, as it was prevailing prior to the amendment, does not contemplate the assessment under Section 43 of the OVAT Act,

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Page 2 of 3

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in absence of the formal assessment order, passed earlier to embarking on the escaped assessment.

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Mr. Padhy, learned Addl. Standing Counsel has fairly submitted that the Joint Commissioner of Sales Tax, the Opposite Party No.1 misconstrued the return as the self assessment report, but actually there was no assessment order under Section 39 of the OVAT Act, 2004.

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