The High Court of Karnataka,dismissed the appeal filed by Kalyan Jewellers Salem (Pvt.) Ltd. holding that a rectification order under Section 69 cannot be treated as part of a reassessment order passed under Section 39(1) of the Karnataka Value Added Tax (KVAT) Act,2003.

Kalyan Jewellers Salem (Pvt.) Ltd,petitioner-assessee,filed an appeal under Section 66(1) of the Karnataka Value Added Tax Act, 2003, challenging the order dated 16.01.2025 passed by the Additional Commissioner of Commercial Taxes, for the assessment year 2010-11.

The appeal questioned the correctness of the revision proceedings initiated under the said order and raised two substantial questions of law.

The petitioner counsel stated that the appellant did not challenge the reassessment order dated 20.01.2017 under Section 39(1) of the KVAT Act but instead filed a rectification application under Section 69 on 15.05.2019. This application was dismissed on 25.06.2019, and an appeal was filed against that dismissal under Section 62(6).

It was argued that the rectification order merged with the reassessment order, so the First Appellate Authority should have considered the appeal on merits. The counsel also submitted that the Revisional Authority failed to address the grounds raised and did not examine the appellant’s input tax credit claim.

The department counsel submitted that the appellant did not file an appeal against the reassessment order under Section 39(1) of the KVAT Act within the time allowed. Instead, a rectification application was filed under Section 69, which was rejected on 25.06.2019.

It was argued that appeal and rectification are two separate legal remedies, and the rectification order could not be treated as part of the reassessment order. Since the appellant missed the opportunity to appeal, they could not raise the same grounds through rectification. The counsel therefore submitted that the second substantial question of law did not arise and the appeal should be dismissed at the admission stage.

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Justice S.G Pandit and Justice T.M Nadaf observed that both the substantial questions of law raised by the appellant did not arise for consideration.

On the second issue, the Court held that the rectification order could not be treated as part of the reassessment order passed under Section 39(1) of the KVAT Act. It noted that appeal and rectification are two separate legal remedies.

Since the appellant did not challenge the reassessment order and only filed an appeal against the rejection of the rectification application, the validity of the reassessment order could not be examined. The Court therefore found that the second question of law did not arise and dismissed the appeal.

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