Rishab Carbons Private Limited vs The Joint Commissioner of Commercial Taxes (Appeals-6)

B.V. Nagarathna, J.—The order of the 1st respondent-Joint Commissioner of Commercial Taxes (Appeals-6), dated 23-12-2013 passed under Section 20 of the Karnataka Sales Tax Act, 1957 read with Section 9 of the Central Sales Tax Act, 1956 is assailed in these writ petitions. Briefly stated, the facts are that the petitioner which is a private limited company, had filed its returns for the assessment years 2001-2002, 2002-2003, 2003-2004 and 2004-2005. Proposition notice in Form 31 was issued on 15-3-2007 and thereafter the assessment orders were passed on 29-3-2007. Those orders were assailed by the petitioner before the 1st respondent by filing appeals on 23-4-2010. The 1st respondent rejected those appeals on the ground of delay, by placing reliance on proviso to sub-section (2) of Section 20 of the Karnataka Sales Tax Act, 1957 (hereinafter referred to as ''the Act'', for short). Being aggrieved by that order, the petitioner has filed these writ petitions.

I have heard the learned Counsel for the petitioner and the learned Additional Government Advocate appearing for the respondents and perused the material on record.

During the course of submissions, learned Counsel for the petitioner has drawn my attention to the fact that Annexure-E which is stated to be the notice dated 15-3-2007 issued under Section 20(2) of the Act was in fact not served on the petitioner, that the assets of the petitioner including the manufacturing unit were taken over by the Karnataka State Financial Corporation (KSFC) under Section 29 of the State Financial Corporations Act, 1951 (SFC Act) on 23-2-2005, thereafter, it was released only on 15-3-2010 and that the petitioner-Company was not functioning from the said address till the latter date. As the notice was issued on the manufacturing unit and the demand notice was served by affixture on the address and not directly to the petitioner and as the manufacturing unit had been taken over by KSFC, the petitioner was not aware of the notice served by affixture on 30-7-2007. He contended that after the release of the assets by the KSFC, the petitioner became aware of the assessment orders and he made an application for certified copies of the assessment orders and on receiving the same on 17-4-2010, the appeals were filed on 23-4-2010. He therefore contended that in fact, there was no delay in filing the appeals having regard to the proviso to sub-section (2) of Section 20 of the Act.

Per contra, learned Additional Government Advocate, supporting the impugned order, stated that the petitioner is not an individual but is a Company which ought to have known about the assessment orders and that the petitioner deliberately filed the appeals belatedly and no indulgence can be shown to the petitioner in these writ petitions.

Having heard the learned Counsel for the respective parties and on perusal of the material on record, it is noted from Annexure-B, which is a letter dated 24-3-2010, addressed by the KSFC to the petitioner that its assets including the manufacturing unit which possession was taken over by the KSFC in the year 2005, was released only on 15-3-2010. Therefore, the service of notice by affixture on 30-7-2007 on the premises of the petitioner''s unit was at a time when possession of the manufacturing unit was with KSFC. Therefore, it could be inferred that there was no direct or actual service of notice on the petitioner''s Company as such. It is only on 15-3-2010 that the assets of the Company including the manufacturing unit were released to the petitioner by KSFC. Thereafter, on 13-4-2010, the petitioner, on coming to know about the assessment orders, filed an application seeking certified copies of those orders and on receipt of the same on 17-4-2010, the petitioner filed the appeals on 23-4-2010. In that view of the matter, there is no delay in filing the appeals. Even otherwise, under the proviso to sub-section (2) of Section 20, provision is there to admit an appeal preferred after the period of 30 days from the date on which the notice of assessment is served, but within a further period of 180 days if it is satisfied that the appellant had sufficient cause for not preferring the appeal within that period. But, as I have held that in the instant case there was no service of notice in view of the assets being under the control of the KSFC, the date that has to be reckoned is only from 15-3-2010 when the assets of the petitioner was released by KSFC and 13-4-2010 when the petitioner filed an application for certified copies of the orders of assessment as there was in fact no actual service of notice on the petitioner. In that view of the matter, the dismissal of the appeals on delay is erroneous. The impugned order at Annexure-F is quashed. The matter is remanded to the 1st respondent to consider the same on merits and in accordance with law. As a direction is now being issued to consider the case of the petitioner on merits and the petitioner is represented by his Counsel, they are directed to appear before the 1st respondent on 28-7-2014 without insisting any separate notice from that authority.

The writ petitions are disposed of in the aforesaid terms.