Justice Ranjan Gogoi and Justice Navin Sinha of Supreme Court in Civil Appeal No(S).15605-15606 OF 2017 held that Designated Authority on behalf of the commissioner of trade and taxes has empowered to issue show cause notice under clause 8 of the Amnesty Scheme.
The Apex Court has held so while hearing the petition of commissioner of trade and taxes against the assesse – M/s Ahluwalia Contracts (India) Ltd.
The challenge by the Revenue is to an order of the High Court of Delhi by which the High Court has allowed the writ petitions filed by the respondents – Assesses challenging the orders issued by the Designated Authority.
Under Section 107 of the DVAT Act, an Amnesty Scheme was notified by the GNCDT on 20th September, 2013. Clause 2(c) of the Amnesty Scheme which defines the ‘designated authority’
Designated authority here means officer(s) not below the rank of Joint Commissioner as notified by the Commissioner, Value Added Tax for the purposes of this Scheme;
Clause 4 explains the procedure for making declaration and clause 5 which deals with immunity from interest, penalty and other proceedings.
Besides that there is no dispute between the parties on the basis of declaration filed by the assesse. On 16th January, 2015, a show cause notice in exercise of power of clause 8, Amnesty Scheme was issued by the Additional Commissioner (particular zone) Department of Trade and Taxes, New Delhi to which the respondent – Assesse.
In the reply so submitted the assesse shouldn’t raise question regarding the jurisdiction of the Additional Commissioner to issue the show cause notice under clause 8.
The assesse then filed a writ petitions to High Court, Delhi by questioning show cause notice submitted was unauthorized and without jurisdiction as the power to issue such notice under clause 8 is vested with the Commissioner and the same had not been delegated to the Designated Authority( Additional Commissioner ).The HC found favour to the respondent-assesse .
Accordingly the petition filed was allowed and also expressed their view as under clause 8(3) of the Amnesty Scheme show cause notice has to be issued within one year of the date of declaration.
In reverse to the HIgh Court order the current petitioner i.e.; commissioner of trade and taxes filed an appeal to the Supreme Court. On the rival contentions, two issues arise for consideration in the present appeal. The first relates to the power and jurisdiction of the Designated Authority to issue the notice under clause 8 of the Amnesty Scheme. The second issue arising would depend on an answer to the first, namely, if it is to be held that the Designated Authority is not empowered to act under clause 8.
The Supreme Court observed that had the assesse raised the question of jurisdiction in its reply or in the course of the adjudication proceedings there would have been still time for the Commissioner to solve the defect and issue a valid notice and also produced some cases related to the jurisdiction of designated authority in clause 8 of the Amnesty Scheme.
The Court observed that “what is vested in the Designated Authority is the power under clause 4 of the Scheme which is the power to hear and decide applications and issue acknowledgments of discharge on due satisfaction. The said power to hear and decide applications, by no means, would include the power to reopen a decided matter which is what clause 8 specifically contemplates.”
The court found favour to the commissioner of trade and taxes and directed the Revenue to issue a fresh notice to the assesse under clause 8 of the Amnesty Scheme.
Read the full text of the Judgment below.
