1954 (1) TMI 18 - HC - VAT and Sales Tax

Summary

Issues:
1. Jurisdiction of the Appellate Tribunal under Section 12A.
2. Interpretation of the Deputy Commissioner's notice dated 10th October, 1951.
3. Powers of the Deputy Commissioner under Section 12(2)(i) and (ii).

In the judgment delivered by the High Court of Madras, the court addressed the jurisdiction of the Appellate Tribunal under Section 12A. The court noted that Section 12A(1) of the Act provides the assessee with a right of appeal against an order relating to assessment passed by the Deputy Commissioner suo motu under Section 12(2). The Appellate Tribunal had initially deemed the order passed by the Deputy Commissioner as not an assessment order passed suo motu but as an order passed on the application of the assessee. However, the court disagreed with this interpretation, emphasizing that the Deputy Commissioner had set aside the assessment made by the Deputy Commercial Tax Officer and proceeded to assess the assessee himself, thereby exercising powers under Section 12(2)(i) as per the notice issued on 10th October, 1951. The court clarified that the powers under Section 12(2)(i) and (ii) are not mutually exclusive, and the Deputy Commissioner can act suo motu even after receiving an application from the assessee if new information necessitates it. The court concluded that the Deputy Commissioner had acted suo motu in making the final assessment, thus establishing the maintainability of the appeals before the Appellate Tribunal.

Furthermore, the court analyzed the interpretation of the Deputy Commissioner's notice dated 10th October, 1951. The notice indicated the cancellation of the revised final assessment order of the Deputy Commercial Tax Officer, followed by a call for the assessee to show cause for a new assessment. The Deputy Commissioner ultimately accepted the turnover figure from the Deputy Commercial Tax Officer's revised order but treated it as an assessment made in revision by himself. The court observed that the Deputy Commissioner's actions, as per the notice, reflected a suo motu assessment exercise rather than solely being based on the revision petition submitted by the assessee. The court highlighted that the notice fulfilled the requirements of Section 12(6) by issuing a notice to the assessee before enhancing the assessment, further supporting the conclusion that the Deputy Commissioner acted suo motu in making the final assessment.

In conclusion, the High Court of Madras set aside the order of the Tribunal and held the appeals to be maintainable. The court directed the Appellate Tribunal to accept the appeals and adjudicate them according to the law. The court made no order regarding costs on the petitions, ultimately allowing the petitions.