Karnataka High Court
M/S J K Developers vs The Deputy Commissioner on 29 March, 2019
Author: S.Sujatha
Bench: S.Sujatha
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 29TH DAY OF MARCH, 2019
BEFORE:
THE HON'BLE MRS. JUSTICE S.SUJATHA
WRIT PETITION No.11792/2019 (T - RES)
BETWEEN:
M/S J.K. DEVELOPERS
No.15/2, FIRST FLOOR
HESSERGHATTA MAIN ROAD
BANGALORE - 560 073
REPRESENTED BY
PROPRIETOR MR. JAGADISH S.
... PETITIONER
[BY SRI UMAPATHI, ADV.]
AND:
THE DEPUTY COMMISSIONER
COMMERCIAL TAXES (AUDIT) - 6, 7
DVO - 06, 3RD FLOOR, 4TH CROSS
KIADB COMPLEX, BLOCK - B
PEENYA, BANGALORE - 560 058.
...RESPONDENT
[BY SRI VIKRAM HUILGOL, HCGP)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
QUASH THE ASSESSMENT ORDER ISSUED BY THE RESPONDENT
DATED 29.08.2015 MARKED AT ANNEXURE - E AND ETC.,
THIS PETITION COMING ON FOR PRELIMINARY HEARING
IN 'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:-
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ORDER
The petitioner, an individual concern was registered under the provisions of the Karnataka Value Added Tax Act, 2003 ('Act' for short) during the relevant tax periods.
2. It is the contention of the petitioner that the respondent concluded the re-assessment proceedings under Section 39(1) of the Act for the tax periods April 2012 to March 2013 without any express authorization by the Commissioner of Commercial Taxes as required under the Act relating to the petitioner. No opportunity of hearing was provided to the petitioner before concluding the assessment; neither the proposition notice nor the assessment order was served. On the other hand, respondent filed recovery petition before the JMFC (Sales Tax) registered as C.Misc.No.20/16.
3. It is contended that after obtaining certain documents under the Right to Information Act pertaining to the assessment order, objections were filed to the recovery proceedings initiated. The learned Magistrate -3- rejected the objections of the petitioner by order dated 15.2.2019 and issued Fine Levy Warrant.
4. At this juncture, the petitioner is before this court challenging the order of re-assessment dated 29.8.2015 passed under Section 39(1) of the Act.
5. The learned counsel appearing for the petitioner mainly contended that the order impugned lacks jurisdiction. No assignment order was issued by the Commissioner of Commercial Taxes authorizing the respondent in terms of the provisions of the Act to re- assess the petitioner. Reliance was placed on the following judgments of this Court:
1. Model Bucket & Attachments Pvt.
Ltd., Vs. Deputy Commissioner of Commercial Taxes (DM) passed in W.P.Nos.60078-81/2010 (D.D. 19.03.2010).
2. Windsor Garden Pvt. Ltd., Vs. State of Karnataka and another passed in W.P.Nos.35005-16/2010 (D.D. 10.11.2010).
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3. M/s R.C.India Vs. The State of Karnataka passed in STA Nos.61 to 63/2009 (D.D.27.10.2009).
6. Learned counsel appearing for the Revenue has filed a memo along with the copy of the assignment order issued by the Commissioner of Commercial Taxes in respect of the petitioner to assess and reassess for the tax periods 2012-13.
7. Learned counsel appearing for the respondent submitted that the writ petition deserves to be rejected at the threshold on delay and laches in challenging the re- assessment order dated 29.3.2015 at this stage. It is submitted that the petitioner was not oblivious of the re- assessment order as he had participated in the recovery proceedings initiated before the learned Magistrate and it is only after suffering an order and subsequent to issue of FLW by the learned Magistrate, is before this Court. Hence seeks for dismissal of the writ petition. -5-
8. I have carefully considered the rival submissions of the learned counsel appearing for the parties and perused the material on record.
9. It is evident that the Commissioner of Commercial Taxes has issued an order assigning assessment and re-assessment under the provisions of the KVAT Act on the respondent relating to the petitioner for the tax period 2012-13. Sl.No.726 of the order of the Commissioner of Commercial Taxes dated 1.10.2013 placed on record by the learned counsel for the Revenue makes it clear that the reasons have been assigned for issuing the assignment note that the assessee received advance amount of Rs.3,94,22,952 on which dealer is liable to pay tax.
10. The Judgments referred to by the learned counsel for the petitioner were rendered in a different context wherein:
a. No assignment note was issued by the Commissioner of Commercial Taxes. -6- b. No specific assignment was made with the designation/name of the officer. c. No material was produced to show that the Commissioner had issued any authorization to the officer to reassess the tax in consonance with the provision 39 of the Act.
11. However in the present case, the order of the Commissioner of Commercial Taxes placed on record envisages the authorization issued to the respondent to reassess the petitioner relating to the tax periods in question.
12. Hence, the arguments of the learned counsel on this point is negated.
13. As regards the submissions made by the learned counsel inasmuch as non service of the proposition notice and the assessment order, the petitioner ought to have challenged the same at the earliest, however proceeded to challenge the recovery proceedings -7- before the learned Magistrate sans challenging the assessment order. It is finally on the rejection of the objections by the petitioner the assessment order is challenged at this length of time.
14. Indisputably, the order impugned is an exparte order and assessee-petitioner is before this Court making allegations inasmuch as non service of proposition notice and assessment order. The petitioner was challenging the assessment order unsuccessfully before the learned Magistrate since 2015-16. In this background, this Court is of the considered opinion that the justice would be sub-served in rejecting the petition with liberty to the petitioner to file an appeal against the order impugned before the appellate forum within a period of two weeks from today.
15. The writ petition stands dismissed relegating the petitioner to avail the alternative remedy of appeal available under the Act. If such an appeal is filed within a period of two weeks from today, the same shall be -8- considered by the Appellate Authority on merits without objecting to the period of limitation, subject to the compliance of other procedural aspects. The Appellate Authority shall decide the matter on merits in accordance with law after hearing the parties in an expedite manner. All rights and contentions of the parties are left open.
16. It is made clear that filing of an appeal is not a bar to proceed with the recovery proceedings unless an interim order of stay is obtained by the Appellate Authority, staying the demand raised by the Revenue.
With the aforesaid observations and directions, writ petition stands disposed of.
Sd/-
JUDGE Dvr/PMR: