1961 (9) TMI 53 - HC - VAT and Sales Tax

Issues Involved:
1. Jurisdiction of the Commercial Tax Officer in exercising revisional powers beyond the period of limitation.
2. Validity of the order of assessment by the Assistant Commercial Tax Officer.
3. Interpretation of Section 12 of the Madras General Sales Tax Act.
4. Communication of the order of assessment to the assessee.
5. Applicability of limitation period under Section 12(4) of the Act.

Detailed Analysis:

1. Jurisdiction of the Commercial Tax Officer in Exercising Revisional Powers Beyond the Period of Limitation:
The petitioner argued that the Commercial Tax Officer exceeded his jurisdiction by exercising revisional powers beyond the prescribed limitation period under Section 12(4) of the Madras General Sales Tax Act. The Court clarified that the period of limitation for the Commercial Tax Officer to act suo motu is three years from the date on which the impugned order of assessment was communicated to the assessee. The Court emphasized that the limitation period starts from the date of communication, not from the date of the order.

2. Validity of the Order of Assessment by the Assistant Commercial Tax Officer:
The petitioner contended that the order of assessment by the Assistant Commercial Tax Officer was incomplete and invalid as it was not communicated to the assessee. The Court found no provision in the statute or rules mandating the communication of such orders to the assessee. The Court held that an assessment is valid once the competent authority makes it after scrutinizing the return submitted by the assessee and giving a reasonable opportunity to prove its correctness and completeness.

3. Interpretation of Section 12 of the Madras General Sales Tax Act:
The Court analyzed Section 12(1) and Section 12(4) of the Act, which deal with the revisional powers of the Commercial Tax Officer. Section 12(1) allows the Commercial Tax Officer to act suo motu and revise any order passed by a subordinate officer. Section 12(4) prescribes a three-year limitation period for such suo motu action. The Court stressed that the limitation period begins from the date the order was communicated to the assessee, aligning with the intent to provide the assessee a fair opportunity to seek revision.

4. Communication of the Order of Assessment to the Assessee:
The Court noted that there is no statutory requirement to communicate the order of assessment to the assessee if no tax is levied. Rule 13 of the Madras General Sales Tax (Turnover and Assessment) Rules requires communication only when tax is due from the dealer. The Court held that the absence of communication does not invalidate the assessment order.

5. Applicability of Limitation Period Under Section 12(4) of the Act:
The Court rejected the Tribunal's reasoning that the revising authority has a general power of revision without a specific limitation period under Section 12(1)(i). The Court clarified that the provisions of Section 12 must be read together, and the limitation period under Section 12(4) applies to all revisional actions. The Court affirmed that the Commercial Tax Officer's proceedings were within jurisdiction as the limitation period had not commenced due to the lack of communication of the assessment order to the assessee.

Conclusion:
The Court dismissed the revision petition, affirming the order of the Commercial Tax Officer and the Sales Tax Appellate Tribunal. The Court held that the Commercial Tax Officer acted within his jurisdiction, and the order of the Assistant Commercial Tax Officer was valid despite not being communicated to the assessee. The Court emphasized the correct interpretation of Section 12 and the applicability of the limitation period from the date of communication of the order. The petition was dismissed with costs, and counsel's fee was fixed at Rs. 100.

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