2026-VIL-631-MAD
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VAT High Court Cases

Tamil Nadu Value Added Tax Act, 2006 - Limitation period for passing assessment order under Section 27, Validity of revival of stale proceeding - A show cause notice for assessment year 2009-2010 was issued on 10.02.2014, to which the assessee replied on 28.03.2014 requesting the respondent to await the order of the High Court in related writ petitions for assessment years 2006-2007, 2007-2008 and 2008-2009. The High Court disposed of the related writ petitions on 29.10.2014, after which a denovo assessment order was passed on 30.09.2015. Subsequently, the assessee filed appeals before the Joint Commissioner and the Sales Tax Appellate Tribunal. The respondent issued an impugned show cause notice on 22.04.2024, which was after the statutory limitation period of six years under Section 27 had expired on 14.03.2017 - Whether the respondent can issue a show cause notice and pass an assessment order for the assessment year 2009-2010 after the statutory limitation period prescribed under Section 27 of the TNVAT Act, 2006 has expired – HELD - The respondent cannot revive a stale proceeding by issuing a fresh show cause notice after the limitation period has expired. The statutory limitation of six years under Section 27 commences from the date of the original assessment order dated 15.03.2011 and expired on 14.03.2017. Although the assessee requested the respondent to keep the proceedings in abeyance pending the High Court's order, this request does not suspend or extend the statutory limitation period. The respondent was entitled to proceed with the adjudication of the SCN even while appeals were pending before the Appellate authorities. Nothing precluded the respondent from passing the order within the prescribed limitation period. The benefit of limitation must enure to the assessee, and a stale proceeding cannot be revived merely because the assessee had sought deferment of adjudication. The fact that the assessee is not required to maintain books of accounts beyond six years further supports this conclusion. The Rule prescribing maintenance of records for six years cannot be applied rigidly when there is a statutory embargo to proceed further - The impugned show cause notice is quashed and the writ petition is allowed
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