VAT Appeal No.76 of 2010 -1- *** IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH VAT Appeal No.76 of 2010 Date of decision: 11.3.2011 State of Punjab and another ...Appellants Versus M/s Jai Bhawani Metal Industries, Moga ...Respondents CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Mr. Jaswinder Singh, Deputy Advocate General, Punjab for the appellants. **** ADARSH KUMAR GOEL, J ( Oral) . 1. This appeal has been preferred by the revenue under Section 68 of the Punjab Value Added Tax, 2005 against order dated 31.5.2010 passed by the Value Added Tax Tribunal (for short “the Tribunal”) in appeal No.80 of 2010, claiming following substantial questions of law:- “a) Whether the order of the Tribunal accepting the appeal on the ground that the order dated 7.9.1998 was passed by AETC, Moga as Assessing Authority u/s 11-A of Act of 1948 is void abinitio is sustainable in law when the said order was passed after issuing notice u/s 21 of Act of 1948? b) Whether the order of the Tribunal holding that order dated 7.9.1998 was passed after the expiry of VAT Appeal No.76 of 2010 -2- *** period of the limitation is sustainable in law? c) Whether the findings of the Tribunal to the effect that order dated 7.9.1998 was reassessment order U/s 11-A are erroneous? d) Whether the appeal has wrongly been accepted by the Tribunal by considering the said order having been passed u/s 11-A of Punjab General Sales Tax Act, 1948? e) Whether the order of Tribunal is sustainable in law?” 2. The assessee filed its returns under the Punjab General Sales Tax Act, 1948 (for short “the Act”) for the year 1992-93. The Assessing Authority framed assessment vide order dated 25.4.1994 accepting claim of the assessee for sales to registered dealers which were liable to be deducted out of the taxable turn over. However, the Revisional Authority exercised suo motu revisional power under Section 21(1) of the Act issued notice dated 27.6.1998 on the allegation that some of the sales were wrongly claimed to be sales to the registered dealers by furnishing bogus statutory forms. This resulted in additional demand of Rs.88,152/-. Appeal against the said order was dismissed on account of failure of the assessee to make the pre-deposit of tax but finally the Tribunal decided the matter in favour of the assessee, inter-alia, on the ground that exercise of suo motu revisional jurisdiction by the Revisional Authority after a period of five years from the date of order of the VAT Appeal No.76 of 2010 -3- *** Assessing Authority was not justified. It was observed:- “From the order dated 7.9.98, it would appear that it was a reassessment had been exercised after the prescribed period of limitation and the order as such was void abinitio. Even if there had been appeals before the DETC and then before the Tribunal, those could not revalidate the proceedings taken later on since the order itself was void abinitio against the provisions of section 11-A of the PGST Act. Under these circumstances, it is held that reassessment order dated 7.9.98 of the Assessing Authority-cum-AETC, Moga of reassessment was void abinitio and order dated 16.2.09 of the Assessing Authority-cum-AETC, Moga and order dated 25.5.2009 of DETC(A), Ferozepur Division, HQ Bathinda against which the appeal is now pending are liable to be set aside and are accordingly set aside.” 3. We have heard learned counsel for the parties. 4. It is not disputed that even though for revisional jurisdiction no period of limitation is prescribed, the said power has to be exercised within reasonable time. It has been so held in State of Punjab v. Bathinda District Cooperative Milk Producers Union Ltd., (2007) 11 SCC 363. Period of reassessment which is five VAT Appeal No.76 of 2010 -4- *** years under Section 11A has been taken by the Tribunal to be reasonable period in the present case. Learned counsel for the State is unable to show that period of five years could not be treated to be reasonable period in the facts and circumstances of the case. There is, thus, no ground to interfere with the view taken by the Tribunal. No substantial question of law arises. 5. The appeal is dismissed. (Adarsh Kumar Goel) Judge March 11,2011 (Ajay Kumar Mittal) Pka Judge