1960 (3) TMI 43 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Jurisdiction of the Sales Tax Officer to assess the respondent for the year 1948-49 under section 21 of the U.P. Sales Tax Act.
2. Validity of the Judge (Revisions) Sales Tax's order dated 28th March 1955.
3. Interpretation and applicability of the amended section 21 of the U.P. Sales Tax Act.

Issue-wise Detailed Analysis:

1. Jurisdiction of the Sales Tax Officer to assess the respondent for the year 1948-49 under section 21 of the U.P. Sales Tax Act:

The respondent, Messrs Jaipuria Brothers Limited, contested the Sales Tax Officer's jurisdiction to assess sales tax for the year 1948-49, arguing that it was an agent, not a dealer, and thus did not file a return for that year. Despite the respondent's protest, the Sales Tax Officer assessed the respondent on 31st March 1952, for the turnover that had escaped assessment. The respondent's appeal against this assessment was initially successful, but the Judge (Revisions) Sales Tax later set aside this annulment and ordered a fresh assessment. The respondent then filed a writ petition, leading to the learned judge ruling that the Sales Tax Officer lacked jurisdiction to make an assessment in 1955 for the 1948-49 turnover, as the period for such assessment ended on 31st March 1952.

2. Validity of the Judge (Revisions) Sales Tax's order dated 28th March 1955:

The learned judge held that the Judge (Revisions) Sales Tax's order directing a fresh assessment was invalid because it was outside the jurisdictional time limit set by section 21 of the Act. However, the appellate authority under section 9 of the Act has the power to set aside an assessment and direct a fresh order after further inquiry, which does not necessarily fall within the three-year limitation period. Similarly, the Judge (Revisions) under section 10 of the Act has broad discretionary powers to pass orders, including setting aside assessments and directing fresh assessments. The court opined that the Judge (Revisions) acted within his jurisdiction and that his order was valid.

3. Interpretation and applicability of the amended section 21 of the U.P. Sales Tax Act:

The amendment to section 21 in 1956 extended the period for making assessments and re-assessments, particularly in cases remanded by appellate or revisional authorities. The learned standing counsel argued that the amended section 21 allowed the Sales Tax Officer to proceed with the assessment despite the initial time limitation. The court agreed, stating that the new section 21 clarified that the time limitation for assessments did not apply to those made under appellate or revisional directions. The court concluded that the Judge (Revisions) had the jurisdiction to pass the order on 28th March 1955, and the Sales Tax Officer was competent to conduct a fresh assessment based on that order.

Conclusion:

The court allowed the appeal, setting aside the learned judge's order and dismissing the respondent's petition. The court held that the Judge (Revisions) Sales Tax had the jurisdiction to direct a fresh assessment and that the Sales Tax Officer was competent to proceed with the assessment under the amended section 21 of the Act. The appeal was allowed without any order as to costs.