# M/S Ramky Infra. Ltd., Hyderabad v. State of U.P. & Ors. 716 INDIAN LAW REPORTS ALLAHABAD SERIES

- **Citation:** (2021) 1 ILRA 715
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-12-15
- **Case number:** Writ Tax No. 671 of 2020
- **Bench:** Surya Prakash Kesarwani, Dr. Yogendra Kumar Srivastava
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-ramky-infra-ltd-hyderabad-v-state-of-u-p-ors-716-indian-law-reports-46122
- **Pages:** 6

## Headnote

(A) Civil Law - U.P. VAT Act, 2008: Section
29(7) read with U.P. Tax on Entry of
Goods into Local Areas Act, 2007- Section
9(4) - Tax - Assessment/ Re-assessment -
The Court held that where the whole of the
turnover has escaped assessment on account of
not passing an assessment order, the provisions
of Section 29(1) of the Act, 2008 can be invoked
by the Assessing Authority and the authorization
under sub-section (7) can be granted by the
competent authority. It is not incumbent upon
the Assessing Authority to make the assessment
first and then only to proceed under Section
29(1) for bringing to tax the turnover not
assessed. (Para 15)

Writ Petition Rejected. (E-8)

List of Cases cited :-

## Text

1 All. M/S Ramky Infra. Ltd., Hyderabad Vs. State of U.P. & Ors.
715
the C.G.S.T. Act shall come into play only
when any proceeding on the same subjectmatter has already been initiated by a
proper officer under the U.P.G.S.T. Act.

18.

Thus,
the
words
"any
proceeding" on the same "subject-matter"
used in Section 6(2)(b) of the Act, which is
subject to conditions specified in the
notification issued under sub-Section (1);
means any proceeding on the same cause of
action and for the same dispute involving
some adjudication proceedings which may
include
assessment
proceedings,
proceedings for penalties etc., proceedings
for demands and recovery under Sections
73 and 74 etc.

Conclusions:-

19. In view of the above, we have
reached to the following conclusions :-

(i) The word "inquiry" in Section 70
has a special connotation and a specific
purpose to summon any person whose
attendance may be considered necessary by
the proper officer either to give evidence
or to produce a document or any other
thing. It cannot be intermixed with some
statutory steps which may precede or may
ensue upon the making of the inquiry or
conclusion of inquiry. The process of
inquiry under Section 70 is specific and
unified by the very purpose for which
provisions of Chapter XIV of the Act
confers power upon the proper officer to
hold inquiry. The word "inquiry" in Section
70 is not synonymous with the word
"proceedings", in Section 6(2)(b) of the
U.P.G.S.T. Act/ C.G.S.T. Act.

(ii) The words "any proceeding" on
the same "subject-matter" used in Section
6(2)(b) of the Act, which is subject to
conditions specified in the notification
issued under sub-Section (1); means any
proceeding on the same cause of action and
for the same dispute involving some
adjudication
proceedings
which
may
include
assessment
proceedings,
proceedings for penalties etc., proceedings
for demands and recovery under Section 73
and 74 etc.

(iii) Section 6(2)(b) of the C.G.S.T.
Act prohibits a proper officer under the Act
to initiate any proceeding on a subjectmatter where on the same subject-matter
proceeding by a proper officer under the
U.P.G.S.T. Act has been initiated.

(iv) Facts briefly noted in paras-6 and
7 above, would disclose that there is no
proceeding by a proper officer against the
petitioner on the same subject-matter
referable
to
Section
6(2)(b)
of
the
U.P.G.S.T. Act. It is merely an inquiry by a
proper officer under Section 70 of the
C.G.S.T. Act.

20. For all the reasons afore-stated,
we do not find any merit in the present
writ petition. Consequently, the writ
petition fails and is hereby dismissed.
----------

(2021)01ILR A715
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 15.12.2020

BEFORE

THE HON'BLE SURYA PRAKASH
KESARWANI, J.
THE HON'BLE DR. YOGENDRA KUMAR
SRIVASTAVA, J.

Writ Tax No. 671 of 2020

M/S Ramky Infra. Ltd., Hyderabad
 ...Petitioner
Versus
State of U.P. & Ors. ...Respondents
716 INDIAN LAW REPORTS ALLAHABAD SERIES
Counsel for the Petitioner:
Sri Shubham Agrawal

Counsel for the Respondents:
C.S.C., Sri C.B. Tripathi

(A) Civil Law - U.P. VAT Act, 2008: Section
29(7) read with U.P. Tax on Entry of
Goods into Local Areas Act, 2007- Section
9(4) - Tax - Assessment/ Re-assessment -
The Court held that where the whole of the
turnover has escaped assessment on account of
not passing an assessment order, the provisions
of Section 29(1) of the Act, 2008 can be invoked
by the Assessing Authority and the authorization
under sub-section (7) can be granted by the
competent authority. It is not incumbent upon
the Assessing Authority to make the assessment
first and then only to proceed under Section
29(1) for bringing to tax the turnover not
assessed. (Para 15)

Writ Petition Rejected. (E-8)

List of Cases cited :-

1. Catalysts Vs St. of U.P. & ors. 2014 UPTC
1054 (DB) (Para-26) (distinguished)

2. M/s Harbilas Prabhu Dayal Vs Commissioner
of Sales Tax, 1979 UPTC 999

3. Commissioner of Sales Tax Vs Jag Mohan
Nath (1972) 29 STC 663 (All) (followed)

4. Commissioner, Sales Tax U.P. Vs Bhuj Singh
Mohan Singh, Bulandshahar 1974 Vol. VI tax
Law Diary 134 (followed)

(Delivered by Hon'ble Surya Prakash
Kesarwani, J. & Hon'ble Dr. Yogendra
Kumar Srivastava, J.)

1. This case was listed as a fresh case
on 09.12.2020 relating to Assessment Year
2012-13 but no one appeared on behalf of the
petitioner
to
press
the
writ
petition.
Therefore, the case was adjourned for
14.12.2020. On 14.12.2020, none appeared
for the petitioner to press the writ petition
even in the revised call. Therefore, the case
was adjourned for 15.12.2020.

2. Today also none has appeared for the
petitioner to press the writ petition even in the
revised call. Sri C.B. Tripathi, learned Special
Counsel for the State-respondents is present.

3. This writ petition has been filed
praying for the following relief:

"(a)Certiorari quashing the impugned
order dated 20.08.2020 passed by the no.3.

(b) Mandamus/ Prohibition restraining
the respondent no.2 from initiating any
assessment/
reassessment
proceedings
against the petitioner in pursuance of the
order dated 20.08.2020 passed by the
respondent no.3.

(c) Mandamus directing the respondent
authorities to produce/ bring on record the
exparte assessment order dated 18.3.16, the
order sheet maintained by the assessing
authority, report furnished by the assessing
authority (respondent no.2) before the Joint
Commissioner (Executive), Mirzapur, as
recorded in the order dated 30.3.19, registers
R-5A, 5B;"

4.

The
impugned
order
dated
20.08.2020 is an authorisation granted by the
Additional
Commissioner
Grade-I,
Commercial Tax, Varanasi Zone - II,
Varanasi under Section 29(7) of the U.P.
VAT Act, 2008 (hereinafter referred to as 'the
Act, 2008') read with Section 9(4) of the
Uttar Pradesh Tax on Entry of Goods into
Local Areas Act, 2007 (hereinafter referred to
as 'the Act, 2007').

5. The Additional Commissioner has
granted the authorisation on the facts of the
present case on the ground that purchases
of U.P. iron and steel of Rs.15,51,47,792/-,
purchase of Ex-U.P. iron and steel of
1 All. M/S Ramky Infra. Ltd., Hyderabad Vs. State of U.P. & Ors.
717
Rs.7,61,61,195.04
and
bitumen
of
Rs.13,03,70,473/- escaped assessment to
entry tax under the Act, 2007 inasmuch as
for reasons mentioned in the impugned
order, the assessment order of entry tax
under Section 9(4) of the Act, 2007 for the
Assessment Year 2012-13 could not be
passed.

6. Section 29(1)/(7) of the U.P. VAT
Act, 2008 (hereinafter referred to as 'the
Act, 2008') are reproduced below:

"29. Assessment of tax of turnover
escaped from assessment.- (1) If the
assessing authority has reason to believe
that the whole or any part of the turnover
of a dealer, for any assessment year or part
thereof, has escaped assessment to tax or
has been under assessed or has been
assessed to tax at a rate lower than that at
which it is assessable under this Act, or any
deductions or exemptions have been
wrongly allowed in respect thereof, the
assessing authority may, after issuing
notice to the dealer and making such
inquiry as it may consider necessary,
assess or re-assess the dealer to tax
according to law :

Provided that the tax shall be charged
at the rate at which it would have been
charged had the turnover not escaped
assessment or full assessment as the case
may be.

Explanation I. - Nothing in this subsection shall be deemed to prevent the
assessing
authority
from
making
an
assessment to the best of its judgment.

Explanation II. - For the purpose of
this section and of section 31, "assessing
authority" means the officer or authority
who passed the earlier assessment order, if
any, and includes the officer or authority
having jurisdiction for the time being to
assess the dealer.

Explanation III. - Notwithstanding the
issuance of notice under this sub-section,
where an order of assessment or reassessment is in existence from before the
issuance of such notice it shall continue to
be effective as such, until varied by an
order of assessment or re-assessment made
under this section in pursuance of such
notice.

(7) Where the Commissioner, on his
own or on the basis of reasons recorded by
the assessing authority, is satisfied that it is
just and expedient so to do, authorises the
assessing authority in that behalf, such
assessment or re-assessment may be made
within a period of eight years after expiry
of
assessment
year
to
which
such
assessment
or
re-assessment
relates
notwithstanding such assessment or reassessment may involve a change of
opinion:

Provided that it shall not be necessary
for the Commissioner to hear the dealer
before authorising the assessing authority."

7. Perusal of the afore-quoted
provisions shows that if the Assessing
Authority has reason to believe that the
whole or any part of the turnover of a
dealer, for any assessment year or part
thereof, has escaped assessment to tax or
has been under assessed or has been
assessed to tax at a rate lower than that at
which it is assessable under this Act, or any
deductions or exemptions have been
wrongly allowed in respect thereof, the
assessing authority may, after issuing
notice to the dealer and making such
inquiry as may be considered necessary,
assess or re-assess the dealer to tax
according to law. Section 29(3) of the Act,
2008 provides that except as otherwise
provided in this section or elsewhere in this
Act, no order of assessment or reassessment under any provision of this Act
718 INDIAN LAW REPORTS ALLAHABAD SERIES
for any assessment year shall be made after
the expiration of three years from the end
of such assessment year. Sub-section (7) of
Section 29 provides for extended period of
limitation upto eight years. It provides that
where the Commissioner, on his own
motion or on the basis of reasons recorded
by the assessing authority, is satisfied that
it is just and expedient so to do, authorises
the assessing authority in that behalf, such
assessment or re-assessment may be made
within a period of eight years after expiry
of
assessment
year
to
which
such
assessment or re-assessment relates.

8. Thus, the normal period of
limitation for assessment or reassessment is
three years as provided under Sub-Section
(3) of Section 29. Beyond the aforesaid
period
of
limitation,
an
Assessing
Authority
can
make
assessment
or
reassessment if he is authorised by the
Commissioner by order passed under SubSection (7) of Section 29, which empowers
the Commissioner to issue authorisation for
making assessment or reassessment within
a period of eight years after expiry of
assessment year to which the assessment or
reassessment relates.

9. In the present set of facts, there is
no
dispute
that
somehow
for
the
Assessment Year 2012-13, assessment
under the Act, 2007 escaped to notice of
the
Assessing
Authority.
Detailed
circumstances leading to the escaping and
passing of the assessment order under the
Act, 2007 for the Assessment Year 20122013 have been mentioned in the impugned
order. Thus, extended period of limitation
under Sub-section (7) of Section 29 of the
Act, 2008 was invokable for which
authorisation has been granted by the
Additional Commissioner by the impugned
order dated 20.08.2020.

10. From perusal of the writ petition,
it appears that the basic objection of the
petitioner to the impugned order is that
reassessment proceedings can take place
only when there is an assessment order and
there is reason to believe that there has
been a case of no assessment or escaped
assessment. In support of the aforesaid
objection, the petitioner has relied upon a
judgment of this Court in the case of
Catalysts vs. State of U.P. and others,
2014 UPTC 1054 (DB)(Para-26).

11. The judgment in the case of
Catalysts vs. State of U.P. and others
(supra) was rendered by this Court in three
writ petitions, namely, Writ Tax No.704 of
2010, 705 of 2010 and 706 of 2010. In Writ
Tax Nos.704 and 705, both of 2010, the
petitioners have challenged the order
passed by the competent authority granting
permission for initiation of proceedings
under Section 21. Both these writ petitions
were dismissed by this court. Third writ
petition, i.e. Writ Tax No.706 of 2010, was
allowed by this court on the facts of that
case. To appreciate facts of the aforesaid
judgment in Writ Tax No.706 of 2010, it
would
be
appropriate
to
reproduce
paragraphs-7, 25, 26 and 27 of the said
judgment, as under:

"7. In Writ Petition No.706 of 2010,
the learned counsel submitted that the
Assessing Officer treated enzymes as a
unclassified item and taxed the same at the
rate of 10% for the assessment year 200607 under the U.P. Trade Tax Act. The
petitioner preferred an appeal, which was
allowed and the matter was remanded back
to
the
Assessing
Officer
for
fresh
assessment.
During
the
pendency
of
assessment
proceedings
before
the
Assessing Officer pursuant to the remand
order
of
the
appellate
authority
1 All. M/S Ramky Infra. Ltd., Hyderabad Vs. State of U.P. & Ors.
719
reassessment proceedings were initiated
under Section 21 of the Act. The learned
counsel submitted that during the pendency
of original assessment proceedings the
question of escaped assessment does not
arise and, therefore, question of issuance of
notice under Section 21 of the Act was
wholly illegal and had been issued without
any application of mind and was liable to
be quashed. In support of his submission,
the learned counsel has placed reliance on
various decisions, which will referred
hereinafter.

25. With regard to Writ Petition
No.706 of 2010, we find that the Assessing
Officer
had
treated
enzyme
as
an
unclassified item and had taxed it at the
rate of 10% for the assessment year 200607 under the U.P. Trade Tax Act. The
petitioner filed an appeal, which was
allowed and the assessment order was set
aside and the matter was remitted to the
Assessing
Officer
to
pass
a
fresh
assessment order. During reconsideration
of the matter reassessment proceedings was
initiated under Section 21 of the Act.

26. In M/s Harbilas Prabhu Dayal Vs.
Commissioner of Sales Tax, 1979 UPTC
999 a Full Bench of this Court held that
once proceedings are remanded by the
appellate authority, the entire matter is at
large.

27. We are of the opinion that
reassessment proceedings can only take
place when there is an assessment order
and there is reason to believe that there has
been a case of under assessment or escaped
assessment. In the event, there is no
assessment
order
there
can
be
no
reassessment proceedings. "

12. The afore-quoted portion of the
judgment in the case of Catalysts (supra) is
the foundation of the present writ petition.
Perusal of the aforesaid judgment in Writ
Tax No.706 of 2010 would show that the
facts were that the assessment order passed
by the Assessing Authority was set aside by
the Appellate Authority for the Assessment
Year 2006-07 under the U.P. Trade Tax
Act, 1948 and the matter was remanded to
the Assessing Authority to pass a fresh
assessment
order.
During
remand
proceedings,
the
Assessing
Authority
eventually initiated proceedings under
Section 21 of the U.P. Trade Tax Act,
1948, which is para materia with Section
29 of the Act, 2008. On these facts, relying
upon a full bench judgment in the case of
M/s
Harbilas
Prabhu
Dayal
Vs.
Commissioner of Sales Tax, 1979 UPTC
999, this court held that hence proceedings
are remanded by the appellate authority, the
entire matter is at large. In the background
of these facts and the legal position, this
court held in para-27, which has been relied
by the petitioner in the present case; that
reassessment proceedings can only take
place when there is an assessment order.
Since no assessment order was passed by
the Assessing Authority pursuant to the
remand order and the entire matter was at
large before him, therefore, it was held by
this court that there is no question of
initiating reassessment proceedings. Thus,
the aforesaid judgment in the case of
Catalysts (supra) is distinguishable on the
facts of the present case.

13. Besides above, if the judgment in
the case of Catalysts (supra) is read in the
manner as interpreted by the petitioner, it
shall be in conflict with the law settled by a
Full Bench (5 Judges) of this court in the
case of Commissioner of Sales Tax vs.
Jag Mohan Nath (1972) 29 STC 663 (All)
in which the Full Bench interpreted the pari
materia provision of Section 21(1) of the
U.P. Sales Tax Act, 1948 and held as under
(Majority view):-
720 INDIAN LAW REPORTS ALLAHABAD SERIES

"33. The principle of law laid down by
the Supreme Court in the cases of
Ghanshyamdas
v.
Regional
Assistant
Commissioner,
Sales
Tax,
Nagpur
MANU/SC/0216/1963 and Anandji Haridas
&
Co.
Private
Ltd.
v.
S.P.
Kushare MANU/SC/0298/1967
applies
equally to assessments under the U.P. Sales
Tax Act and assessment proceedings in
cases where no returns are filed by a
dealer can be made both under Section
7(3) and Section 21(1). Which of the two
sections will apply to a particular case will,
however, depend on the circumstances of
each case. The non-furnishing of returns by
a dealer, and the consequent failure to pay
the tax due, vest in the assessing authority
the power to make a best judgment
assessment
both
under Section
7(3) and Section 21(1) of the Act. If the
circumstances are such as to attract the
provisions of Section 21(1), the assessment
will be made under that provision,
otherwise under Section 7(3). It is not
incumbent on the assessing authority to
make the assessment first under Section
7(3) and
then
only
to
proceed
under Section 21 for bringing to tax the
turnover not assessed under Section 7(3).
The
powers
contemplated
by Section
7(3) and Section 21 are independent of
each other and can be resorted to
independently according to the material
available to the assessing authority."

14. The Full Bench judgment in the
case of Jag Mohan Nath (supra) has also been
followed by a Division Bench of this court in
Commissioner, Sales Tax U.P. vs. Bhuj
Singh Mohan Singh, Bulandshahar (S.T.R.
No.214 of 1971, decided on 04.09.1974)
1974 Vol.VI Tax Law Diary 134.

15. Perusal of sub-section (7) of Section
29 of the Act, 2008 leaves no manner of
doubt that it empowers the Commissioner to
grant authorisation and also empowers the
Assessing Authority to make assessment or
reassessment within a period of eight years
after expiry of assessment year to which such
assessment or reassessment relates. Subsection (1) of Section 29 empowers the
Assessing Authority to make assessment or
reassessment where he has reason to believe
that whole or any part of the turnover of a
dealer, for any assessment year or part
thereof, has escaped assessment to tax or has
been under assessed or has been assessed to
tax at a rate lower than that at which it is
assessable under this Act, or any deductions
or exemptions have been wrongly allowed in
respect thereof. Thus, where whole of the
turnover has escaped assessment on
account of not passing an assessment
order, the provisions of Section 29(1) of the
Act, 2008 can be invoked by the Assessing
Authority and the authorisation under
sub-section (7) can be granted by the
competent authority. It is not incumbent
upon the Assessing Authority to make the
assessment first and then only to proceed
under Section 29(1) for bringing to tax the
turnover not assessed.

16. For all the reasons afore-stated,
we find that the writ petition is without
substance. Consequently, it is hereby
dismissed. However, there shall be no
order as to costs.
----------
(2021)01ILR A720
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 18.12.2020

BEFORE

THE HON'BLE SURYA PRAKASH
KESARWANI, J.
THE HON'BLE DR. YOGENDRA KUMAR
SRIVASTAVA, J.