Facts of the Case

The petitioner, M/s. Ramesh Javery & Co., challenged the assessment proceedings initiated under the Odisha Entry Tax Act before the High Court of Orissa. The principal grievance was that the assessment order passed under Section 9C of the OET Act was barred by limitation prescribed under Section 9C(6). The petitioner further contended that the Audit Visit Report (AVR) in Form E-27 had also been submitted beyond the limitation period prescribed under Section 9B(2) read with Rule 11(5)(c) of the OET Rules.

The matter came before the High Court after the Tribunal had upheld the assessment order. The Court also noted that repeated adjournments had already been granted to the Department for production of the original records, and therefore declined any further request for adjournment.

 

Issues Involved

  1. Whether the assessment order passed by the Assessing Authority under Section 9C of the Odisha Entry Tax Act was barred by limitation under Section 9C(6).
  2. Whether the submission of the Audit Visit Report (AVR) in Form E-27 was time-barred under Section 9B(2) read with Rule 11(5)(c) of the Odisha Entry Tax Rules.

 

Petitioner's Arguments

The petitioner argued that:

  • The assessment order had been passed beyond the statutory limitation prescribed under Section 9C(6) of the Odisha Entry Tax Act and was therefore invalid.
  • The Audit Visit Report (AVR) in Form E-27 had also not been submitted within the period prescribed under Section 9B(2) read with Rule 11(5)(c) of the OET Rules.
  • Both issues were already settled in favour of assessees by earlier decisions of the High Court, and the impugned orders deserved to be quashed accordingly.

 

Respondent's Arguments

The State defended the assessment proceedings and sought further adjournment for production of the original records. However, the Court rejected the request after observing that sufficient opportunities had already been granted to the Department.

 

Court Order / Findings

The High Court allowed the revision petition and held as follows:

  • The first issue relating to limitation under Section 9C(6) stood concluded in favour of the petitioner by the earlier decision in M/s. Cobra Instalaciones Y Servicios, S.A. v. Commissioner of Sales Tax, Cuttack (Order dated 29 July 2021).
  • The second issue concerning limitation for submission of the Audit Visit Report under Section 9B(2) read with Rule 11(5)(c) was also covered in favour of the petitioner by the earlier judgments in:
    • M/s. Pal Construction v. The Assessing Authority, Bhubaneswar I Circle, Bhubaneswar (Order dated 18 April 2022), and
    • M/s. Grihasthi Udyog v. Commissioner of Sales Tax (Order dated 28 June 2022).
  • Since both questions were already settled by binding precedents, the Court set aside:
    • the order of the Tribunal,
    • the order of the Assistant Commissioner of Sales Tax (ACST), and
    • the assessment order passed by the Assessing Authority.
  • The Sales Tax Revision was accordingly allowed with no order as to costs.

 

Important Clarification

  • Assessment proceedings under Section 9C of the Odisha Entry Tax Act must strictly comply with the limitation prescribed under Section 9C(6).
  • The Audit Visit Report (Form E-27) must also be submitted within the limitation prescribed under Section 9B(2) read with Rule 11(5)(c) of the Odisha Entry Tax Rules.
  • Any assessment founded upon a time-barred Audit Visit Report or completed beyond the statutory limitation is liable to be quashed.
  • This judgment reaffirms and follows the principles laid down in:
    • M/s. Cobra Instalaciones Y Servicios, S.A. v. Commissioner of Sales Tax, Cuttack
    • M/s. Pal Construction v. The Assessing Authority, Bhubaneswar I Circle, Bhubaneswar
    • M/s. Grihasthi Udyog v. Commissioner of Sales Tax.

Sections Involved

  • Section 9C(6) of the Odisha Entry Tax Act (OET Act)
  • Section 9B(2) of the Odisha Entry Tax Act
  • Rule 11(5)(c) of the Odisha Entry Tax Rules
  • Assessment Proceedings under the Odisha Entry Tax Act

 

Link to download the order -

https://mytaxexpert.co.in/uploads/1782972394_186compressed.pdf

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