(Prayer: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, to call for the records relating to the Impugned Show Cause Notice No.TIN/33881320020/2009-2010 dated 22.04.2024 issued by the Respondent and quash the same.)

1. The Petitioner is before this Court against the Impugned Show Cause Notice dated 22.04.2024 issued for the Assessment Year 2009-2010.

2. The challenge to the Impugned Show Cause Notice is on the ground that there was an inordinate delay in adjudication of the proposal that was made earlier vide Show Cause Notice dated 10.02.2014 issued under Section 27 of the Tamil Nadu Value Added Tax Act, 2006 for the aforesaid Assessment Year 2009-2010.

3. It is submitted that the Petitioner had requested the Respondent by a Communication dated 28.03.2014 to await for the order of the Writ Court in W.P.Nos.6732 to 6734 of 2014, wherein Assessment Orders dated 31.01.2014 passed for the Assessment Years 2006-2007, 2007-2008 and 2008-2009 were challenged.

4. The Writ Court had remitted the cases back to the Assessing Officer vide Order dated 29.10.2014 in W.P.Nos.6732 to 6734 of 2014, to pass a fresh order on merits. Subsequently, the Respondent passed the denovo Assessment Order dated 30.09.2015 for the Assessment Years 2006-2007, 2007-2008 and 2008-2009.

5. It is further submitted that in the Petitioner’s Reply dated 28.03.2014 in response to the Show Cause Notice dated 10.02.2014 issued for the first instance under Section 27 of the Tamil Nadu Value Added Tax Act, 2006, for the Assessment Year 2009-2010, following the self-assessment order made on 15.03.2011, the Petitioner requested to keep the proceedings in abeyance, pending the order of the Writ Court in W.P.Nos.6732 to 6734 of 2014.

6. It is moreover submitted that despite the order of the Writ Court in W.P.Nos.6732 to 6734 of 2014 dated 29.10.2014 and the subsequent denovo order, confirming the demand for the Assessment Years 2006-2007, 2007- 2008 and 2008-2009, the Respondent did not take any meaningful steps to adjudicate the issue. Instead, the Respondent issued a Show Cause Notice belatedly on 22.04.2024.

7. Therefore, it is submitted that the adjudication of the Impugned Show Cause Notice issued long after the expiry of 9 years from the date of the Writ Court order dated 29.10.2014 and the subsequent order of the Respondent issued for the Assessment Years 2006-2007, 2007-2008 and 2008-2009, are liable to be interfered with.

8. The learned counsel for the Petitioner placed reliance on the following decisions of the Hon’ble Supreme Court and that of this Court:-

                     i.State of Punjab Vs. Bhatinda District Cooperative Milk Producers Union Limited, 2007 (217) E.L.T. 325 (SC).

                     ii. Kanthimathy Estate Vs. The Assistant Commissioner of Commercial Taxes, 2019 (7) TMI 1991.

                     iii.Gingee Agriculture Producers, Co-operative Marketing Society Limited Vs. The Sales Tax Officers, 2023 (9) TMI 635.

                     iv. M/s.DXC Technology India Private Limited Vs. The Joint Commissioner of GST and Central Excise, Chennai and others in W.P.Nos.2489 and 2496 of 2022 vide order dated 09.05.2025.

                     v. M/s.Oliva Care Vs. The State Tax Officer, Podanur Assessment Circle, Coimbatore in W.P.Nos.6153, 6156 and 6157 of 2021 vide order dated 18.09.2024.

                    vi. The Appellate Assistant Commissioner (CT), Commercial Taxes Department, Puducherry Vs. M/s.Supreme Coaters and Fabricators, Puducherry, Represented by its Proprietor in T.C.(Revision) Nos.41 to 43 of 2016 vide order dated 01.10.2024.

9. The learned counsel for the Petitioner further submits that in the dispute pertains to the Assessment Year 2009-2010, the records will not be available for the Petitioner to file a Reply to the Show Cause Notice, and prays for quashing of the Impugned Show Cause Notice.

10. The Learned Special Government Pleader for the Respondent, on the other hand, would submit that the Writ Petition is without any merits. It is submitted that the Respondent kept the issue pending, since the Petitioner had filed an Appeal against the Order dated 30.09.2015 passed for the Assessment Years 2006-2007, 2007-2008 and 2008-2009, pursuant to the Order dated 29.10.2014 passed in W.P.Nos.6732 to 6734 of 2014.

11. It is further submitted that the Petitioner had questioned the Jurisdiction of the Respondent in the said proceedings, and therefore, with a view to avoid any challenge to the order for the Assessment Year 2009-2010, the proceedings initiated under the Show Cause Notice dated 10.02.2014 were kept in abeyance.

12. It is moreover submitted that as against the order dated 30.09.2015, the Petitioner filed an Appeal before the Joint Commissioner (CT) Appeals, Chennai and that the Joint Commissioner (CT) Appeals, Chennai, confirmed the demand by an order dated 25.10.2016 in A.P.Nos.124, 127 and 128 of 2015, respectively.

13. That apart, it is submitted that the Petitioner has paid the entire amount of tax confirmed vide order dated 30.09.2015 and that the Petitioner’s Appeal against the order of the Joint Commissioner (CT) Appeals, Chennai in A.P.Nos.124, 127 and 128 of 2015 was confirmed by the Appellate Tribunal, Chennai, by its order dated 02.08.2023. It is in this background, the Impugned Show Cause Notice has been issued on 22.04.2024.

14. The Learned Special Government Pleader for the Respondent would specifically draw reference to the Petitioner’s Reply dated 28.03.2014 to the first mentioned Show Cause Notice dated 10.02.2014 issued under Section 27 of the Tamil Nadu Value Added Act, 2006, wherein the Petitioner had categorically stated as under:-

                     “10...

                     The proposals in the present notice are identical to the demands already raised vide aforesaid revision orders. Those orders were passed clearly on the basis of the direction of the Enforcement Wing Officer. You are also aware that the deviation proposals had been sent by your predecessor and yourself even for this year. Since you have been unable to independently adjudicate for the years 2006-07, 2007-08 and 2008-09, we are certain that you will not be able to act objectively and independently for this year.

                     We therefore request you not to adjudicate the present notice at this stage but instead await the final orders of the Hon’ble Madras High Court.”

15. It is submitted by the learned counsel for the Petitioner that there is no embargo on the Respondent proceeding with the adjudication of the proposal in the Impugned Show Cause Notice dated 22.04.2024 in terms of the decision of the Division Bench of this Court in W.P.Nos.6153, 6156 and 6157 of 2021 dated 18.09.2024.

16. The Learned Special Government Pleader for the Respondent would submit that the Sales Tax Appellate Tribunal (STAT) by its order dated 02.08.2023, confirmed the demand insofar as Defect Nos.2 and 4.

17. The Learned Special Government Pleader for the Respondent also filed a copy of the order dated 02.08.2023 of the Sales Tax Appellate Tribunal (STAT) in TA.No.28 of 17 and COP No.40 of 17, TA.No.29 of 17 and COP No.25 of 17 and TA No.30 of 17 and COP No.26 of 17. Relevant portion of the order of the Sales Tax Appellate Tribunal (STAT) reads as under:-

                     “6. The State had filed Cross Objection Petition for all the three assessment years. In the cross objection petition, they had extracted Section 12 and its subsections. They contended that the petitioner purchased vegetable oil as exempted from registered dealer as per Entry 65 of Part-B of the Fourth Schedule to the Act and used in the manufacture of biscuits. The claim of exemption is a conditional exemption for certain dealers under certain circumstances. Hence, it is clearly evident that the circumstances contemplated in Section 12 are satisfied for levy of tax. They relied on the decision of the Hon'bles Supreme Court reported in 36 STC 191 in the case of M.K.Kandasamy and Others, Ruchi Soya Industries Limited reported in 12 VST 546, orders of this Tribunal in TA Nos:27/2005 and 28/2007 dated 9.8.2010. They further stated that the petitioners claim of relief on similar issues has been denied to him on earlier occasions on sound legal basis and logical reasoning by the Hon'ble High Court and the Hon'ble Appellate Tribunal and prayed to dismiss the appeals filed by the dealers.”

18. I have considered the arguments advanced by the learned counsel for the Petitioner and the learned Special Government Pleader for the Respondent.

19. Perusal of the records reveal that Audit was conducted on 04.12.2009 for the Tax Period between April 2006 and September 2009. In this background, for the Assessment Year 2006-2007, 2007-2008 and 2008- 2009, three Show Cause Notices were issued to the Petitioner on 16.05.2011 for the Financial Year 2006-2007 and on 04.07.2011 for the Financial Years 2007-08 & 2008-09 under Section 27 of the Tamil Nadu Value Added Tax Act, 2006, for the tax having allegedly escaped assessment. However, it has to be noted that no Show Cause Notice was issued to the Petitioner for the Assessment Year 2009-2010 for income having escaped assessment.

20. Later, an Assessment Order dated 15.03.2011 came to be passed for the Assessment Year 2009-2010. The aforesaid Assessment Order was passed without considering the impact of the tax implication arising out of the Audit held on 04.12.2009.

21. Meanwhile, during the interregnum, Assessment Orders came to be passed on 31.01.2014 for the Assessment Years 2006-2007 to 2008-2009, pursuant to the above mentioned Show Cause Notices dated 16.05.2011 and 04.07.2011.

22. Close on heels, a Show Cause Notice under Section 27 of the Tamil Nadu Value Added Tax Act, 2006 was issued to the Petitioner on 10.02.2014 for the Assessment Year 2009-2010 under Section 27 of the Tamil Nadu Value Added Tax Act, 2006 to pass a fresh Assessment Order in lieu of the Assessment Order dated 15.03.2011. The above Show Cause Notice dated 10.02.2014 was replied by the Petitioner on 28.03.2014, content of relevant portion of it has been already extracted in Paragraph No.14 of this Order. In the above Reply dated 28.03.2014 for the Show Cause Notice dated 10.02.2014, the Petitioner was on merits.

23. In the reply, the Petitioner stated that the proposal in the Show Cause Notice dated 10.02.2014 was similar to the demand proposed for the Assessment Years 2006-2007 to 2008-2009 in respect of which, Assessment Orders came to be passed on 31.01.2014 and the issue is pending before the this Court in W.P.Nos.6732 to 6734 of 2014.

24. The Petitioner therefore requested the Respondent not to adjudicate the issue and to await the order of this Court in the above mentioned Writ Petitions.

25. Meanwhile, by an order dated 29.10.2014, the Writ Court quashed the Assessment Order dated 31.01.2014 passed for the above Assessment Years 2006-2007 to 2008-2009 and remitted the cases back to the Respondent to pass a fresh order which in turn culminated in denovo Assessment Orders all dated 30.09.2015 for Assessment Years 2006-2007 to 2008-2009, whereby the demand was once again confirmed.

26. The Petitioner unsuccessfully challenged the aforesaid order as the aforesaid Assessment Orders dated 30.09.2015 before the Joint Commissioner (CT) Appeals, Chennai. The Joint Commissioner (CT) Appeals, Chennai vide order dated 25.10.2016 dismissed the appeals of the Petitioner in A.T.Nos.124, 127 and 128 of 2015.

27. It is noticed that before the First Appellate Authority namely the Joint Commissioner (CT) Appeals, Chennai, the Petitioner had deposited the entire demand for the Assessment Years 2006-07 to 2008-09 and therefore contested the aforesaid Appellate Order dated 25.10.2016 before the Sales Tax Appellate Tribunal (STAT) in TA.No.28 of 17 and COP No.40 of 17, TA.No.29 of 17 and COP No.25 of 17 and TA No.30 of 17 and COP No.26 of 17.

28. The Sales Tax Appellate Tribunal (STAT) by its order dated 02.08.2023 has also confirmed the views of the Joint Commissioner (CT) Appeals, Chennai dated 25.10.2016, as also denovo order dated 30.09.2015 passed by the Deputy Commissioner (CT)-III, Large Taxpayers Unit, Chennai pursuant to order dated 29.10.2014 in W.P.Nos.6732 to 6734 of 2015.

29. Therefore, the Impugned Show Cause Notice dated 22.04.2024 has been issued. It cannot reignite the limitation which had expired on 14.03.2017 merely because the Petitioner vide reply dated 28.03.2014 requested the Respondent not to adjudicate the case which was pending for final orders of this High Court.

30. Since the Assessment Order for the Financial Year 2009-2010 was passed on 15.03.2011 after the audit was conducted by the officials on 04.12.2009, the Respondent was entitled to invoke Section 27 of Tamil Nadu Value Added Tax Act, 2006 and pass order on the ground that tax had escaped assessment. The limitation for passing order under Section 27 of the Tamil Nadu Value Added Tax Act, 2006 is six years and would have expired on 14.03.2017.

31. After the demand for the Assessment Years 2006-2007 to 2008- 2009 were confirmed vide denovo Orders dated 30.09.2015 of the Deputy Commissioner (CT)-III, Large Taxpayers Unit, Chennai, orders pursuant to Show Cause Notice dated 10.02.2014 issued for the Assessment Year 2009- 10 ought to have been passed on or before 14.03.2017 being the last date to pass order in terms of Section 27 of the Tamil Nadu Value Added Tax Act, 2006.

32. The denovo order dated 30.09.2015 passed by the Deputy Commissioner (CT)-III, Large Taxpayers Unit, Chennai was also confirmed by the Joint Commissioner (CT) Appeals, Chennai vide order dated 25.10.2016. Thus, Orders should have been passed within the limitation under section 27 of the Tamil Nadu Value Added Tax Act, 2006 by 14.03.2017.

33. Instead, the Respondent has waited for the Sales Tax Appellate Tribunal (STAT) to pass its order dated 02.08.2023 dismissing the Petitioner’s appeals order dated 25.10.2016 of Joint Commissioner (CT) Appeals, Chennai. Thus, there was no justification in keeping the issue alive beyond the statutory provisions of law.

34. The decision of this Court in M/s. Oliva Care Vs The State Tax Officer dated 18.09.2024 in W.P.Nos.6153, 6156 and 6157 of 2021 is of no relevance as it dealt with limitation under Section 22 of the Tamil Nadu Value Added Tax Act Act, 2006. It dealt with deemed assessment and procedure to be followed by the Assessing Authority. Therefore, the said decision is not applicable to the facts of the present case.

35. Since W.P.Nos.6732 to 6734 of 2014 were disposed of by this Court on 29.10.2014 and denovo Assessment Order came to be passed on 30.09.2015 by the Respondent for the Assessment Years 2006-2007, 2007- 2008 and 2008-2009, no order was passed within the period of limitation under Section 27 of the Tamil Nadu Value Added Tax Act, 2006.

36. Facts on record reveal that nothing precluded the Respondent from proceeding further from adjudicating Show Cause Notice dated 10.02.2014 even if the Petitioner had filed an Appeal against the denovo Assessment Order dated 30.09.2015 before the Joint Commissioner (CT) Appeals, Chennai and further appeal before the Sales Tax Appellate Tribunal (STAT).

37. Since Petitioner and Respondent are governed by limitation, under Section 27 of the Tamil Nadu Value Added Tax Act, 2006, the benefit of limitation has to enure to the Petitioner. A stale proceeding cannot be revived in view of limitation under Section 27 of the Tamil Nadu Value Added Tax Act, 2006.

38. Though it was argued that the Petitioner is not required to maintain books of accounts for a period beyond six years, it is to be held that as per Section 64(2)(b) of the Tamil Nadu Value Added Tax Act, 2006 read with Rule 6(11) of the Tamil Nadu Value Added Tax Rules, 2007, an Assessee is required to maintain the books of accounts for a period of 6 years from the date of assessment. I have to state that, this Rule cannot be applied rigidly, if there was an embargo to proceed further in view of the order of the Appellate Authority.

39. That apart, the issue could not have been kept pending long after the High Court passed its order on 29.10.2014 in W.P.Nos.6732 to 6734 of 2014, quashing the Assessment Orders where the Petitioner had challenged the Assessment Order dated 31.01.2014 passed for the Assessment Years 2006-07, 2007-08 and 2008-09.

40. Therefore, this Writ Petition is deserves to be allowed and is accordingly allowed. No costs. Connected Writ Miscellaneous Petition is closed.