Shiv Steels Vs State of Assam & Ors. (Supreme Court of India)
Conclusion: Where assessments were subsequently held invalid as being time-barred under Section 19, Revenue could not revive such invalid assessments by resort to Section 21. Supreme Court held that the Revenue authorities could not impose tax on the basis of legislative intent, substance, or analogy, unless the case strictly fell within the provisions of the statute.
Held: The present appeal arose from the common judgment and order passed by the Gauhati High Court, whereby the writ petition filed by assessee came to be dismissed. By the said order, the reassessment passed under the provisions of the Assam General Sales Tax Act, 1993, was set aside and the matter remitted to AO for fresh consideration. The controversy pertained to the assessment years 2003–04, 2004–05, and 2005–06. The case of assessee was that the assessments for these years were time-barred. It was urged that in view of the limitation prescribed under Section 19 of the Act, the authority concerned initially declared the assessments for all the years to be time-barred. However, subsequently, the Department obtained sanction from the Commissioner and invoked Section 21 to bring the reassessment within the extended limitation. High Court had upheld this view, reasoning that sanction by Commissioner under Section 21 revived the Revenue’s powers even though earlier assessments were already declared time-barred. Dissatisfied, assessee approached the Supreme Court. It was held that a plain reading of Section 21 makes it evident that it applies only in cases where no assessment had been made within the period prescribed under Section 19. In the present case, however, assessments had been undertaken but were subsequently held invalid as being time-barred under Section 19. Once so declared, Revenue could not revive such invalid assessments by resort to Section 21. The High Court’s interpretation to the contrary was legally unsustainable. It was a settled principle that in construing fiscal statutes, one must adhere strictly to the letter of the law. The subject could not be taxed by inference, analogy, or presumed legislative intent. Unless the Revenue demonstrated that the case strictly fell within the four corners of the taxing statute, no tax could be imposed. In view of the above discussion, the appeals succeeded.
