Allowed

M/s.Vanaja Electrical Appliances (P) Ltd. v. The Commercial Tax Officer

Telangana HC8 Apr 2021WP/8774/2021

Case brief

AI extract

What is this about?

The High Court allowed a writ petition challenging an ex parte audit assessment order passed during the Covid-19 lockdown. The court set aside the order for violation of natural justice due to lack of service of pre-assessment notice and remitted the matter for fresh consideration with a personal hearing.

What did the court decide?

The impugned Assessment Order is set aside; the matter is remitted for fresh consideration with service of pre-assessment show cause notice and a personal hearing provided to the petitioner.

M/s.Vanaja Electrical Appliances (P) Ltd. Vs The… — GST and Indirect Tax | Telangana HC (2021)

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HIGH COURT FOR^{THE STATEOF TELANGANA AT HYDERABAD} (Special Original Jurisdiction)

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THURSDAY, THE EIGHTH^{DAY OF APRIL} TWO THOUSAND AND TWENTY ONE

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PRESENT

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THE HON'BLE SRI JUSTICE^{M.S.RAMACHANDRA RAO} AND

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THE HON'BLE SRI JUSTICE^{T.VINOO KUMAR}

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WRIT PETITION NO. 8774 OF 2021

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Between:

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tril/s,Vanaja Electrical Appliances^{(P) Ltd, PlotNo 48/'1 , Phase-ll, S'V C l E" Balanagar,} ff VO"raO-iO^{- -} SOO Oi7. State 6f^{Telangana,Rep. by its ManagingDirector} It'4r'lv Prabhaka

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..PETrroNER

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AND

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1 The Commercial Tax Officer,^{It/adhapurCircle-1,Hyderabad.} 2 fhe Staie - of Telangana, Rep. dy its Princip-al Secretary, Revenue (CT) Department, Telangana^{Secretariat,Hyderabad.}

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...RES'ONDENTS

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Petition under Article²²⁶ of^{lhe constitutionof lndia prayingthat in the} circumstances stated^{in the affidavitfiled therewith,the High Court may be pleased} to issue wirt of Mandamus or^{any other appropriate writ or order or direction} declaring the action of the^{'1st Respondentin passing the Audit Assessment} Proceedings, dated³¹ .03.2020^{Exparte, during the lock down period, for the tax} period 2013-14 under the Telangana^{Value Added Tax Act 2005,servedon} 23.04.2020 by RPAD,^{without providing an opportunity of being heardto the} Petitioner, levying higher^{rate of tax of Rs.1,94,60,3861-} @^{14.5 Percentage on entire} turnover of Rs.13,42,09,558/-,^{as againsi 5% sales of Rs'11,36,15,7211- and 14 5%} sales of Rs.2,05,93,8371^{liableto tax of Rs.86,66,892/- and disallowanceof ITC of} Rs.59,37,363/. on^{purchasetUrnoverof Rs.11,87,47,2671.,as arbitrary, contraryto} the provisions of the^{TVAT Act, 2005, without jurisdiction, patently barred by} limitation for the tax^{period 2013-14,and in violationof principlesof natural justice,} rule of law, and consequently^{set aside the Audit AssessmentProceedings of thel st} respondent, dated 31.03.2020,^{as nulland void.}

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lA NO: 1 OF 2021

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Petition under Section^{151CPC prayingthat in the circumstancesstated in} the affidavit filed ln^{support of the petition,the High Court may be pleasedto} suspend the operation^{of the Audit Assessment Proceedings of the 1st respondent,} dated 31.03.2020,^{served on 24.04.2020by RPAD,for the tax period 2013-14, under} TelanganaValueAddedTaxAct2005,pendingdisposaloftheaboveWritPetition' asothenvise,thePetitionerwillbeputtoseverelossandhardship'

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Counsel for the^{Petitioner:SRISHAIKJEELANI BASHA} Counsel for the^{Respondents:SRISAI KRISHNA,AGP FOR}

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ADVOCATE GENERAL

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The Court at the^{stage of admissionmadethe following:ORDER}

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HONOURABLE SRI JUSTICE M.S.RAMACHANDRA RAO

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AND

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HONOURABLE SRI JUSTICE T.VINOD KUMAR

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WRIT PETITION No.8774 of 2021

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ORDEIT:^(l)cr llor,'blc Sri Justicc V.S.^{l{amachandr-a} Iliro)

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Heard learned counsel for petitioner and Sri Sai Krishna, learned Assistant Government Pleader attached to the Office of the learned Advocate General, appearing for respondents.

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In this Writ Petition, petitioner assails the Assessment Order No.350210 dt.31-03-2020 passed by the 1" respondent under the Telangana State VAT Act,2005 (for short'the Act') for the period April, 2013 to March, 2014.

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The main contention of learneC counsel lbr petitioner is that pre-assessnrent show cause in Form VAT 305-4 was not served on petitioner and the impugned ordel has been passed during the lockdown imposed by the State and Central Govemr-nents on account of Covid-19 pandemic.

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A further contention is also raised that the said Assessment Order is barred by limitation and that the extended period of limitation introduced by Act26 of2017 cannot be applied and it is not valid.

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Sri Sai Krishna, learned Assistant Government Pleader attached to the Office of the leamed Advocate General, appearing fbr

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respondents does not dispute that there is no evidence of service of pre-assessment show cause notice on petitioner.

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Therefore, on the ground of violation of principles of natural justice, the impugned Assessment Or.der No.52010 dt.3 l_03_2020 passed by l" respondent is set aside; the matter is remitted back to the l't respondent for fresh consideration; the l,trespondent is directed to serve pre-assessment show cause on petitioner in accordance with Rule 64 of the Telangana VAT Rules; petitioner is granted six (06) weeks time from the date of receipt of such show cause to file objections along with supporting material; a personal hearing shall be provided to the petitioner by I't respondent; and then a reasoned order be passed by I't respondent and communicate it to the petitioner.

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The Writ Petition is allowed as above. No costs.

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Consequently, miscellaneous petitions, pending if any, shall

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stand closed.

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SD/-K.SAILESHI ASSrsrANr zlclsrRAR //TRUE COPY// SECTION^OFFICER

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To '1. The Commercial Tax Officer, lvladhapur Circle--l'^Hyderabad' 2. The Principal^{secretary]"n"*"'ii} f^{Cf) Department'State of Telangana'} Telanoana Secretariat,^Hvderabad' 3 o#'ic i;5n^{s-nai[leetlniBasha,Advocate[oPucl} 4. Two ccs^{to The nouocJie -G;;";;i, Higti cdurt for-theState of Telansanaat} Hvderabad. [OUT] 5. Two CD Copies.

[\r'lP

HIGH COURT

DATED:0810412021

ORDER

WP.No.8774 of 2021