1976 (1) TMI 153 - SC - VAT and Sales Tax

Whether the exercise of the power of revision under sub- section (3) of section 20 of the Bengal Finance (Sales Tax) Act, 1941, as extended to the Union Territory of Delhi-hereinafter called the Act-is subject to the period of limitation provided in sub-section (2a) of section 11 or section 11-A of the said Act? Held that - Appeal dismissed. There was no undue or unreasonable delay made by the Commissioner. It may be stated here that an appeal has to be filed by an assessee within the prescribed time and so also a time-limit has been prescribed for the assessee to move in revision. The appellate or the revisional powers in an appeal or revision filed by an assessee can be exercised in due course. No time-limit has been prescribed for it. It may well be that for an exercise of the suo motu power of revision also, the revisional authority has to initiate the proceeding within a reasonable time. Any unreasonable delay in exercise may affect its validity. What is a reasonable time, however, will depend upon the facts of each case

Issues Involved:
1. Period of limitation for exercising appellate or revisional power under sub-section (2a) of section 11 of the Bengal Finance (Sales Tax) Act, 1941.
2. Limitation period for the Commissioner's exercise of power in revision under section 20(3) of the Act.
3. Applicability of the limitation period provided in sections 11 and 11-A to the Commissioner when exercising revisional power under section 20(3).
4. Requirement for the revisional authority to exercise power in a reasonable manner and within a reasonable time.

Issue-wise Detailed Analysis:

1. Period of Limitation for Exercising Appellate or Revisional Power:
The appellant contended that appellate and revisional authorities must exercise their powers within the period prescribed under sub-section (2a) of section 11 of the Act. Specifically, if their orders are final orders of assessment, they are exercising powers under sub-sections (1) or (2) of section 11. Even if their orders are of remand for fresh assessment, they must pass their orders within the prescribed periods, although the assessing authority may have a further period of 4 or 6 years for passing a fresh assessment due to the proviso added in 1959. The court noted that section 11(2a) provides a limitation period for assessments, but the proviso allows the period to be reckoned from the date of an appellate or revisional order. The legislature did not provide a specific period for appellate or revisional authorities to make their orders, as it would be impractical.

2. Limitation Period for Commissioner's Exercise of Power in Revision:
The appellant argued that the Commissioner cannot overstep the 3-year limitation period provided in section 11-A of the Act when exercising revision power. The court observed that section 20(3) allows the Commissioner to revise any assessment or order under the Act. The revisional power is not circumscribed in sub-section (3) but is akin to the appellate authority's power. The court referenced the State of Kerala v. K.M. Cheria Abdulla and Company case, noting that the revisional authority should not encroach upon powers expressly reserved by the Act or Rules to other authorities. Section 11-A deals with escaped assessments and is subject to its own limitations.

3. Applicability of Limitation Period Provided in Sections 11 and 11-A:
The appellant suggested that the Commissioner is subject to the limitation periods in sections 11 and 11-A even when exercising revisional power under section 20(3). The court rejected this argument, stating that the Commissioner revises orders made by other authorities and is not the one who passed the original assessment order under section 11. The term "Commissioner" in the sections includes officers assisting the Commissioner, but they exercise different powers.

4. Requirement for Revisional Authority to Exercise Power Reasonably and Timely:
The appellant contended that the revisional authority must exercise power reasonably and within a reasonable time, and cannot act suo motu after a long delay. The court agreed that unreasonable delay could affect the validity of the exercise of revisional power. However, in this case, the Commissioner acted within a few months of the appellate order, indicating no undue or unreasonable delay. The court emphasized that what constitutes a reasonable time depends on the facts of each case.

Conclusion:
The court dismissed the appeals, holding that the Commissioner's revision of the appellate order was valid and timely. The arguments regarding the limitation periods and the exercise of revisional power were rejected, and the court found no undue delay in the Commissioner's actions. The appeals were dismissed with costs, and the court awarded one set of hearing fees.

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