1969 (12) TMI 87 - SC - VAT and Sales Tax

Whether an exemption granted by the State Government during the course of the year was applicable to the whole or only a part of the year of assessment? Held that - Appeal allowed.

Summary

Issues:
1. Validity of ex parte assessments for failure to append list of sales to registered dealers as required by rule 30 under the Punjab General Sales Tax Act, 1948.
2. Interpretation of the scheme of levy and assessment of tax under the Act.
3. Legality of quarterly assessments under the Punjab General Sales Tax Act.
4. Overruling of previous judgments by the Full Bench of the Punjab High Court.

Analysis:
1. The judgment addressed the issue of ex parte assessments due to the failure of the assessee to append the list of sales to registered dealers as required by rule 30 under the Punjab General Sales Tax Act, 1948. The Sales Tax Officer proceeded with the assessments for two quarters without the necessary information, leading to a petition in the High Court seeking to quash the orders of assessment.

2. The court examined the scheme of levy and assessment of tax under the Act, emphasizing that a registered dealer must file returns of turnover as prescribed and pay tax accordingly. The assessing authority has the discretion to accept the return or call for explanations and evidence from the taxpayer to support the turnover. The Act mandates periodical returns and tax payments based on the turnover.

3. The judgment delved into the legality of quarterly assessments under the Punjab General Sales Tax Act, referencing a previous case where it was held that tax assessments could only occur at the end of the year. However, a Full Bench of the Punjab High Court overruled this, stating that sales tax assessments could be based on quarterly returns submitted by the dealer before the close of the financial year. The court affirmed that such assessments are not provisional but valid under the Act.

4. The judgment highlighted the overruling of previous judgments by the Full Bench of the Punjab High Court, emphasizing that assessment proceedings under the Act could commence before the end of the year if provision is made for submission of periodical returns. The court upheld the legality of such assessments and dismissed the petition, setting aside the High Court's order.