APHC010063802021 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3525] WEDNESDAY, THE NINTH DAY OF APRIL TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO THE HONOURABLE DR JUSTICE K MANMADHA RAO WRIT PETITION NO: 3846/2021 Between: M/s. Lakshminarayana And Co. ...PETITIONER AND The State Of Andhra Pradesh and Others ...RESPONDENT(S) Counsel for the Petitioner: 1. K RAJI REDDY Counsel for the Respondent(S): 1. ADDL ADVOCATE GENERAL II 2. ADDL ADVOCATE GENERAL The Court made the following order: (per Hon’ble Sri Justice R. Raghunandan Rao) Heard Sri G. Narendar Chetty, learned counsel appearing for Sri K. Raji Reddy, learned counsel for the petitioner and the learned Government Pleader for Commercial Tax appearing for the respondents. 2. The petitioner, which is a registered dealer, under the Andhra Pradesh Value Added Tax Act, 2005 (here-in-after referred to as “the Act”), 2 RRR, J & Dr. KMR, J W.P.No.3846 of 2021 was subjected to audit proceedings, under an authorisation given by the Deputy Commissioner (CT) No.1 Division, Vijayawada and subsequent assessment proceedings, on the basis of another authorisation given by the Deputy Commissioner. The assessment proceedings culminated in an order of assessment, dated 29.03.2019, passed by the 2nd respondent. The said assessment proceedings were for the years 2013-14 and 2014-15. 3. Aggrieved by the said order of assessment, the petitioner has approached this Court with the contention that the said order of assessment is beyond limitation and has to be set aside. 4. The case of the petitioner is that the period of limitation stipulated under the Act is contained in Section 21 (4) of the Act and the same reads as under: (4) The authority prescribed may, based on any information available or on any other basis, conduct a detailed scrutiny of the accounts of any VAT dealer or TOT dealer and where any assessment as a result of such scrutiny becomes necessary, such assessment shall be made within a period of four years from the end of the period for which the assessment is to be made. 5. The learned counsel for the petitioner would submit that Section 2 (36) of the Act stipulates that the tax period would be the calendar month or such period as may be prescribed. As there is no such prescription by way of the Rules, the tax period, under the provisions of the Act, would be a calendar 3 RRR, J & Dr. KMR, J W.P.No.3846 of 2021 month. The learned counsel further contends that the time for filing of returns for every calendar month is prescribed under Rule 23 of the AP VAT Rules. The time that is so prescribed is within 20 days of the succeeding month. 6. On this basis, the learned counsel would contend that the assessment order, dated 29.03.2019 could have been passed only relation to tax period from March 2015 onwards only and the periods earlier to this month would be beyond limitation. 7. The respondents have filed counter affidavit disputing this contention. 8. The learned Government Pleader for Commercial Tax has taken this Court through the pleadings in the counter affidavit. The learned Government Pleader, while reiterating the said contentions, would also submit that the order, passed by the Assessing Officer, is not just a best judgment order, but is also an order passed on account of wilful evasion of tax by the petitioner. He would submit that the petitioner had not produced the books of account before the Assessing Officer and the same should be treated as evasion of tax. He would submit that, in such circumstances, the provisions of Section 21 (5) of the Act, granting limitation of six years, would be applicable and the assessment order would be within time. 9. As pointed out by the learned counsel for the petitioner, the assessment period is every calendar month. The time within which returns are to be filed is by the 20th of the succeeding month. The period of limitation for 4 RRR, J & Dr. KMR, J W.P.No.3846 of 2021 completing assessment for each calendar month would be 4 years from the 20th of the succeeding month of the tax period. In the presenct case, the order of assessment, dated 29.03.2019, would be within limitaion, under Section 21 (4) of the Act, only for the month of March, 2015. The period prior to this month would be beyond limitation. 10. The learned Government Pleader contends that the period of limitation is six years as prescribed under Section 21 (5) in as much as there is willful evasion of tax. For the purpose of making out a case, the learned Government Pleader relies upon the counter affidavit filed by the Assessing Officer. A perusal of the counter affidaivt would show that the Assessing Officer, except stating that non-presentation of the books of accounts would amount to evasion of tax, has not made out any other ground to make out a case of evasion of tax. Apart from this, it is only the statements in the impugned order that can be looked into by this Court and a subsequent affidavit cannot improve the order under review. (please see Mohinder Singh Gill & Anr. vs The Chief Election Commissioner1) 11. A perusal of the order would show that there is no mention of any evasion of tax in the order of assessment. The only statement made in the order of assessment was that the assessment was being carried on best judgment basis as the books of accounts of the petitioner have not been produced before the Assessing Officer. 1 1978 AIR 851: 1978 (1) SCC 405 5 RRR, J & Dr. KMR, J W.P.No.3846 of 2021 12. In such circumstances, this Court has to hold that the order of assessment, dated 29.03.2019, is beyond limitation for the years 2013-14 and for the period April 2014 to Feb 2015. The order of assessment would be within limitation only for March 2015. 13. Consequently, the order of assessment would have to be set aside. As far as the period March, 2015 is concerned, the matter is remanded back to the Assessing Authority for an appropriate decision, in relation to this month alone. 14. Accordingly, this Writ Petition is allowed, setting aside the order of assessment, dated 29.03.2019, passed by the 2nd respondent and leaving it open to the 2nd respondent to undertake assessment for the month of March, 2015, after giving due notice to the petitioner. There shall be no order as to costs. As a sequel, pending miscellaneous applications, if any, shall stand closed. _______________________ R RAGHUNANDAN RAO, J _______________________ Dr. K MANMADHA RAO, J Date: 09.04.2025 MJA 6 RRR, J & Dr. KMR, J W.P.No.3846 of 2021 148 THE HON’BLE SRI JUSTICE R RAGHUNANDAN RAO AND THE HON’BLE DR JUSTICE K MANMADHA RAO WRIT PETITION NO: 3846 of 2021 (per Hon’ble Sri Justice R. Raghunandan Rao) 09.04.2025 MJA