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Punjab and Haryana HC stays second notice against company in multi-crore VAT scam case

The High Court issued the stay order citing a special leave petition (SLP) against the earlier issued orders of the High Court is still pending in the apex court.

Written by Saurabh Prashar | Chandigarh |
March 9, 2021 2:04:57 am
Haryana HC, multi-crore VAT scam case, Value Added Tax scam, UT administration, Chandigarh news, Haryana news, Indian express newsThe UT Administration had issued a second notice under Section 29 (2) of the Punjab Value Added Tax Act, 2005 against one of the 47 companies, M/s Shiva Traders.

IN A setback to UT Administration, the Punjab and Haryana High Court put a stay on the re-proceeding initiated for the recovery of money in connection with the multi-crore Value Added Tax (VAT) scam.

The orders were issued March 1. The UT administration has received a copy of the order Monday. The proceeding was initiated following the Apex Court’s decision in favour of UT administration in February this year.

The High Court issued the stay order citing a special leave petition (SLP) against the earlier issued orders of the High Court is still pending in the apex court.

The UT Administration had issued a second notice under Section 29 (2) of the Punjab Value Added Tax Act, 2005 against one of the 47 companies, M/s Shiva Traders.

The notice against the company was issued on February 18.

A total 47 companies were identified for evading VAT and not submitting the annual statements under Rule 40 of the Punjab Value Added Tax, Rules, 2005 in 2019.

These companies had obtained a stay on the earlier issued notices from the High Court in February, 2020.

The UT Administration had then filed an SLP against the HC’s decision in the apex court, which put a stay on the stay the HC’s orders.

“We are in the process of approaching the apex court against the recent decision of high court. Certain companies are making their best efforts to evade the fine. The apex court had delivered a decision in our favor. We will pursue the again,” said Excise and Taxation Commissioner, Mandip Singh Brar.

The excise and taxation department had unearthed a multi-crore scam on part of a number of private firms which did not submit the annual statement under Rule 40 of the Punjab Value Added Tax Rules, 2005, which is applicable in Chandigarh too. The annual statements were released for the assessment year 2010-11. The notices were issued in 2019.

One of the firms, M/s Shiva Traders, had approached the High Court against 47 notices, claiming that the notices were issued beyond the time limit. The petitioner had argued that the administration can challenge the submitted annual statements only within six years of filing of statement under Section 29 (4) of the Punjab Value Added Tax Rules, 2005.

It had argued that the assessment year was 2010-11 and the annual statement was to be filed in November 2011.

The six years expired on November 19, 2017, but the notices were issued in 2019, which was beyond the time limit.

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