AI Structured Summary
Not yet generated for this judgment
Judgment
S. Abdul Nazeer
Leaned HCGP is directed to take notice for the respondents.
In these cases, the petitioner has called in question the validity of the order at Annexure-D dated 10.10.2011 and the demand made in the communication at Annexure-D1 dated 8.11.2011 whereby the lst respondent has rejected the request of the petitioner to stop recovery proceedings pursuant to the order at Annexure-D.
The petitioner is a Company engaged in the manufacture and sale of iron and steel and allied products having its head office at Raichur and the branch office at Bangalore. The petitioner''s branch office al Bangalore was inspected by lst respondent on 25.11.2010 u/s 52(1) of Karnataka Value Added Tax Act. 2003 (for short ''the Act''). On the basis of the inspection, a notice u/s 38(5) of the Act dated 26.3.2011 was issued to the petitioner followed by a protective assessment order at Annexure-D dated 10.10.2011 for the months of October 2010 and November 2010.
Learned Counsel for the petitioner submits that the 1st respondent has inspected the branch office of the petitioner at Bangalore without authority of law. It is further contended that the petitioner has filed its returns u/s 35(1) of the Act.. The said returns is deemed to have been accepted u/s 38(1) of the Act. Therefore, it was unnecessary for the 1st respondent to pass the protective order of assessment u/s 38(5) of the Act
On the other hand, learned HCGP appearing for the respondents has sought to justify the impugned order at Annexure-D dated 10.10.2011 and the communication at Annexure-D1 dated 8.11.2011.
I have carefully considered the arguments of the learned Counsel for the parties made at the Bar and perused the materials placed on record.
Sub-section 5(a) of Section 38 provides for passing a protective order of assessment. It states that the prescribed authority on any evidence showing a liability to tax coining to its notice may with the previous permission of his Joint Commissioner or Additional Commissioner issue a protective assessment in the case of a dealer registered under the Act or a dealer liable to be registered under the Act, if the prescribed authority has reason to believe that such dealer will fail To pay any tax. penalty or interest so assessed or imposed or payable and such tax, penalty or interest shall become payable forthwith.
In the present case, the protective assessment order was passed on 10.10.2011 for the months of October 2010 and November. 2010 Admittedly, the petitioner has filed the returns u/s 35(1) of the Act. If prescribed authority is of the view that the deemed orders of assessment requires reassessment u/s 39(1) of the Act, he has to issue notice to the petitioner and pass appropriate orders thereon. Whether the 1st respondent has been authorised or not to make inspection of the branch office of the petitioner u/s 52(1) of the Act has to be taken into consideration while passing the order u/s 39(1) of the Act. No purpose will be served by passing a projective order of assessment for the months of October and November 2010 on 10.10.2011.
The writ petitions succeed and arc accordingly allowed in part, The order at Annexure-D dated 10.10.2011 and the communication at Annexure-D 1 dated 8.11.2011 are hereby quashed. However, liberty is reserved to the prescribed authority to pass the order of reassessment u/s 39(1) of the Act. All the contentions of the parties on merit are kept open.
Learned HCCP is granted eight weeks time to file memo of appearance on behalf of the respondents. No costs.