Revenue’s Failure to Produce Server Records Strengthens Anti-Dating Claim: Allahabad HC Quashes Trade Tax Assessment as Time-Barred [Read Order]
Allahabad High Court quashed a trade tax assessment as time-barred, holding that Revenue’s failure to produce process server records strengthened the assessee’s anti-dating claim.
Trade - Tax - Taxscan
Trade - Tax - Taxscan
In a recent ruling, the Allahabad High Court held that when the Revenue fails to produce original records of the process server, the allegation of anti-dating of an assessment order cannot be disbelieved, and the benefit must go to the assessee.
Avant Grade Carpets Pvt. Ltd., a 100% export-oriented unit engaged in the manufacture and sale of woollen carpets, filed revisions against the orders of the Trade Tax Tribunal, Meerut, relating to the assessment year 1996-97 under the U.P. Trade Tax Act.
The assessee’s books of account were rejected after a survey in June 1998, and a show cause notice was issued. The assessing authority passed an assessment order, which was confirmed in first appeal but later remanded in second appeal in February 2001. After remand, the assessment order was again passed and served on 29 November 2002.
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The assessee’s counsel argued that the order should have been served by 27 November 2002 under Section 21(5) of the Act, and service on 29 November 2002 made it time-barred. It was also argued that the order was anti-dated to show compliance within limitation and that the absence of the process server’s record supported this claim.
The department’s counsel argued that the assessment order was actually passed on 12 November 2002 and handed to the process server on 13 November 2002, which was within time. It was further argued that the allegation of anti-dating was only based on assumptions.
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The Division Bench comprising Justice Piyush Agrawal observed that the Revenue had failed to produce the original record of the process server despite repeated directions of the court. The court explained that it was the duty of the authorities to maintain such records, and in their absence, the assessee could not be made to suffer.
The court pointed out that without the original record, the assessee’s allegation of anti-dating stood fortified. The court held that the assessment order was time-barred and that the Tribunal and appellate authorities erred in treating it as valid. The court quashed the impugned orders and allowed the revisions in favour of the assessee. The question of law was answered against the Revenue.
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