The High Court of Kerala quashed the reassessment proceedings under section 17D of the Kerala General Sales Tax Act (KGST), 1961 since the provision does not prescribe any time limit and no additional material to undertake the fast track assessment was presented by the department.
The petitioner, K. Sasilal was served with a notice for the re-assessment of the proceedings under Section 17D of the Kerala General Sales Tax Act, 1963 pertaining to the method of fast track completion of the assessment, noticing the escaped turnover based upon certain observation of the order. The notice also reflected in the sensor audit of the respondent authority to furnish the copies of audit objection and sanction order. But, without providing the documents as sought for, issued another notice under Section 17D of the Act, 1963.
The petitioner contended that as per Section 17D, the assessment completed shall not be re-opened unless there is a fresh receipt of materials pertaining to tax evasion, and the outer time limit as provided under Section 19 of the assessment of sale turnover would apply, which prescribed the period of five years from the expiry of the year to which the tax relates and not beyond.
“There is no justification for this department or material placed on record as per the provision of Section 17D, I am of the firm opinion that in the absence of any statutory period referred to Section 17D escaped assessment way of fast track assessment can be taken almost 14 years later. The reasonable period can be extended upon the period referred to by other provisions regarding the escaped assessment under Section 19,” the bench said.Subscribe Taxscan AdFree to view the Judgment