M/S.Goa Carbon Ltd. v. Dy.Commissioner of Sales Tax

Orissa HC6 Feb 2024WP(C)/1071/2017

Case brief

AI extract

What is this about?

M/s Goa Carbon Limited v. Deputy Commissioner of Sales Tax, Jagatsinghpur Circle, Paradeep; withdrawal of completed VAT/CST assessment orders; Section 42A Odisha Value Added Tax Act 2004; Rule 12(3) Central Sales Tax (O) Rules 1957; Section-41 OVAT Act; Circular No.18034/CT dated 30.11.2016; Annexure-1 notice dated 05.12.2016 quashed; assessment orders dated 24.10.2016 (Annexures-9 & 10); tax period 01.04.2013 to 31.03.2015; unilateral withdrawal without notice; violation of principles of natural justice; no statutory authority to withdraw completed assessment; writ petition allowed; Orissa High Court, Cuttack; decided 06.02.2024.

What did the court decide?

Writ petition allowed; withdrawal notice dated 05.12.2016 (Annexure-1) quashed; urgent certified copy to be issued as per rules. ¶¶19

M/S.Goa Carbon Ltd. Vs Dy.Commissioner of Sales Tax — Orissa HC (2024) — LawSathi Research

What the court decided

AI extract

Outcome

Writ petition allowed; withdrawal notice dated 05.12.2016 (Annexure-1) quashed; urgent certified copy to be issued as per rules.

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Issue for consideration

Whether the unilateral withdrawal, without prior notice, of completed assessment orders passed under Section 42A of the Odisha Value Added Tax Act, 2004 and Rule 12(3) of the Central Sales Tax (O) Rules, 1957 was authorised by law and consistent with principles of natural justice.

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Court's answer

Since the petitioner fully participated in the proceedings under Section 42A of the Odisha Value Added Tax Act, 2004 and Rule 12(3) of the Central Sales Tax (O) Rules, 1957 resulting in assessment orders (Annexures-9 & 10), the unilateral withdrawal of those orders without notice under Annexure-1 violated principles of natural justice.

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Ratio / Principle

There exists no provision in law which authorises opposite party no.1 to pass a withdrawal order in completed assessment proceedings.

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Key takeaways

Annexure-1 (the withdrawal notice dated 05.12.2016) stands quashed.ratio¶¶18

Detailed headnote1 paragraphs

Orissa High Court at Cuttack (Acting Chief Justice Dr. B.R. Sarangi and Justice Murahari Sri Raman; order dated 06.02.2024) allowed W.P.(C) No. 1071 of 2017 filed by M/s Goa Carbon Limited. Assessment orders dated 24.10.2016 (Annexures-9 & 10) had been passed in lieu of audit under Section 42A of the Odisha Value Added Tax Act, 2004 and Rule 12(3) of the Central Sales Tax (O) Rules, 1957 for the tax period 01.04.2013 to 31.03.2015. Thereafter, a notice dated 05.12.2016 (Annexure-1), issued on the basis of Circular No.18034/CT dated 30.11.2016 (Annexure-2), intimated withdrawal of those assessment orders. Holding that the petitioner had fully participated in the assessment proceedings, that unilateral withdrawal of the completed assessment orders without any prior notice violated principles of natural justice, and that no provision of law authorised opposite party no.1 to pass a withdrawal order in completed assessment proceedings, the Court quashed Annexure-1 and allowed the writ petition.

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IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No. 1071 of 2017

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M/s Goa Carbon Limited

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….. Petitioner

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Mr. S.Dalei, Advocate

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Vs.

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Deputy Commissioner of Sales …... Opposite Parties Tax, Jagatsinghpur Circle, Paradeep and others

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Mr. Sunil Mishra, Standing Counsel for CT & GST Organization

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CORAM:

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ACTING CHIEF JUSTICE DR. B.R.SARANGI MR.JUSTICE MURAHARI SRI RAMAN

ORDER

06.02.2024

Order No.

This matter is taken up through hybrid mode.

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1. Heard Mr. S.P. Dalai, learned counsel appearing for the Petitioner and Mr. Sunil Mishra, learned Standing Counsel for the CT & GST Department-Opposite Parties.

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In the present case, it appears that assessment proceedings in lieu of audit under Section 42A of the Odisha Value Added Tax Act, 2004 and under Rule 12(3) of the Central Sales Tax (O) Rules, 1957 for the tax period 01.04.2013 to 31.03.2015 were carried out. As a consequence of such assessment in lieu of audit, orders under Section 42A of the Odisha Value Added Tax Act, 2004 and under Rule 12(3) of the Central Sales Tax (O) Rules, 1957 were passed on 24.10.2016 under Annexures-9 & 10 respectively. Thereafter, it appears that a notice dated 05.12.2016 under Annexure-1 has come to be issued basing on the Circular No.18034/CT dated 30.11.2016 under Annexure-2, intimating the withdrawal of assessment orders passed under Section 42A of the Odisha Value Added Tax Act, 2004 and

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under Rule 12(3) of the Central Sales Tax (O) Rules, 1957. It is contended on behalf of the petitioner that once pursuant to statutory notices, assessment orders are passed; there is no scope for withdrawal of assessment orders, so also there is no scope for further initiation of proceeding under Section-41 of the Odisha Value Added Tax Act, 2004 and Central Sales Tax (O) Rules, 1957. It is submitted that the order of withdrawal under Annexure-1 is otherwise bad in law as the same has been issued without any prior notice, thus in violation of principles of natural justice.

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Since the Petitioner has fully participated in the proceedings initiated under Section 42A of the Odisha Value Added Tax Act, 2004 and under Rule 12(3) of the Central Sales Tax (O) Rules, 1957 resulting in passing of assessment orders under Annexure-9 & 10 respectively, the withdrawal of said orders unilaterally without notice under Annexure-1 has caused violation of principles of natural justice. Further there exists no provision in law, which authorizes opposite party no.1 to pass the withdrawal order in completed assessment proceedings. Accordingly, Annexure-1 stands quashed.

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Accordingly, the writ petition is allowed.

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Issue urgent certified copy as per rules.

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(DR. B.R. SARANGI) ACTING CHIEF JUSTICE

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Signature Not Verified

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Digitally Signed Signed by: ASWINI KUMAR SETHY Designation: PA(SECRETARY-IN-CHARGE) Reason: Authentication Aswini/Suchitra Location: ORISSA HIGH COURT, CUT TACK Date: 07-Feb-2024 10:59:16

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(M.S. RAMAN) JUDGE

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M/S.Goa Carbon Ltd. v. Dy.Commissioner of Sales Tax

Case brief

What is this about?

What did the court decide?

M/S.Goa Carbon Ltd. v. Dy.Commissioner of Sales Tax

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

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