1972 (11) TMI 70 - SC - VAT and Sales Tax

Whether the provisions of the 1959 Act empowered the assessing authority to reopen the assessments? Held that - Appeal dismissed. The question for decision is as to who had the jurisdiction to reopen the concerned assessments. Such a question cannot be considered as a question of procedure. Under the old Rules the assessee had a right to have his assessments reopened only by the appellate authority. This was undoubtedly a right conferred on the assessee. It is a valuable right. That being so, the same is protected by the proviso.

Summary

Issues:
Assessment of sales tax under the Madras General Sales Tax Act, 1939 and 1959 Act, reopening of assessments under section 16 of the 1959 Act, authority to reopen assessments, applicability of rule 17 of the Rules framed under the 1939 Act, jurisdiction to revise assessments under the Madras General Sales Tax Act, 1959, distinction between procedure and power in reopening assessments.

Analysis:
The Supreme Court heard appeals related to the assessment of sales tax on the respondent for the years 1957-58 and 1958-59 under the Madras General Sales Tax Act, 1939 and 1959 Act. The assessments were reopened under section 16 of the 1959 Act, with the appellant contending that for the year 1958-59, there was no reopening. However, the Court held that since this contention was not raised before the High Court, it could not be considered at this stage, proceeding on the basis that both assessments were reopened.

The assessing authority had reopened the assessments under the 1959 Act, but the High Court ruled that only the appellate authority could reopen assessments that were the subject of an appeal under rule 17 of the Rules framed. The Court considered whether the assessments were governed by the 1939 Rules or the 1959 Act, citing a previous decision of the Madras High Court regarding the provision for reopening assessments under the 1939 Act. The Court agreed with the High Court that the appellate authority alone could revise the assessments under the 1959 Act, as per the proviso to section 61(1) of the Act.

The Court distinguished between procedure and power in the context of reopening assessments, rejecting the argument that reopening was merely a procedural matter. It held that the jurisdiction to reopen assessments was a question of power, not procedure, as it involved the right of the assessee to have assessments reopened only by the appellate authority, a valuable right protected by the proviso to section 61(1) of the 1959 Act. Consequently, the appeals were dismissed, emphasizing that the jurisdiction to reopen assessments was a question of power, not procedure.

In conclusion, the Court upheld the decision of the High Court, dismissing the appeals and emphasizing the distinction between procedure and power in the context of reopening assessments under the Madras General Sales Tax Act, 1959.