Trade Cir. No.21T of 2012 Mumbai, Dt. 26/11/2012
Sub : Cancellation of assessment order under section 23(11)
Ref. : Representation from Sales Tax Practitioners Association, Maharashtra, dated 16th April 2012.
The section 23 of the MVAT Act, 2002 provides for the assessment of tax under different contingencies.
2. Sub-section (11) of section 23 provides that,
(1) where a dealer has been assessed under sub-section (2), (3) or (4) and if he makes an application in Form-316 to the Commissioner within thirty days from the date of service of the assessment order, for the cancellation of the assessment on the ground that he was unable to attend before the Commissioner for hearing.
(2) on receipt of the application the assessing authority verifies the correctness of the contention and if found correct, the assessing authority shall cancel the assessment order so passed. Therefore, it is mandatory for the assessing officer to cancel the assessment order, if the contentions stated in the application are found to be correct.
3. The Sales Tax Practitioners Association of Maharashtra (STPAM) has represented that sometimes the assessing authorities reject the applications made for cancellation of assessment order on the grounds that the order is being passed under sub-section (3A) and not under sub-section (2), (3) or (4) of section 23.
4. The point raised by STPAM is clarified as under:
(1) Sub-section (3A) of section 23 provides that the assessment under sub¬section (2) or (3) may be made within seven years in respect of the periods ending on or before 31st March 2008. In other words, by virtue of sub-section (3A) the order of assessment may be passed before the expiry of the seven years, however, the assessment order is required to be made under sub-section (2) or (3).
(2) As stated above the assessment order even though passed within extended time period is required to be made either under sub-section (2) and (3). Hence, the provisions of sub-section (11) will become squarely applicable.
5. This circular cannot be made use of for legal interpretation of provisions of, as it is clarificatory in nature. If any member of the trade has any doubt, he may refer the matter to this office for further clarification.
6. You are requested to bring contents of this circular to the notice of the members of your association.
Commissioner of Sales Tax,
Maharashtra State, Mumbai.