1963 (3) TMI 40 - HC - VAT and Sales Tax

Summary

Issues:
Jurisdiction of Deputy Commissioner of Commercial Taxes to re-open assessment and revise turnover under the Andhra Pradesh General Sales Tax Act.

Analysis:
The judgment involves a revision filed by the State of Andhra Pradesh against the decision of the Andhra Pradesh Sales Tax Appellate Tribunal regarding the revisional jurisdiction of the Deputy Commissioner of Commercial Taxes. The case pertains to a dealer in bullion and jewelry provisionally assessed for the year 1955-56, where the assessing authority estimated the turnover to the best of his judgment due to alleged suppression of turnover. The Deputy Commissioner of Commercial Taxes, in the exercise of his revisional jurisdiction, enhanced the turnover significantly, leading to an appeal by the assessee to the Sales Tax Appellate Tribunal.

The key question in this case was whether the Deputy Commissioner had the authority to re-open the assessment made by the Commercial Tax Officer. The interpretation of Section 20 of the Andhra Pradesh General Sales Tax Act, corresponding to Section 12 of the Madras General Sales Tax Act, was crucial. The language of these sections was analyzed to determine the scope of the revising authority's powers in dealing with assessment orders.

The Court examined Section 14 of the Andhra Pradesh General Sales Tax Act, which governs the assessment of tax payable by a dealer. It was observed that the function performed by the Deputy Commissioner in enhancing the turnover fell under Section 14(4), which deals with cases where turnover has escaped assessment to tax. The judgment emphasized that the power to redetermine turnover under Section 14(4) is vested in the assessing authority, not in appellate or revisional authorities.

The Court referred to a judgment of the Madras High Court, highlighting the distinction between correcting improper assessment orders and dealing with escaped turnovers. The judgment emphasized that turnover escapes assessment when not noticed due to inadvertence, omission, or deliberate concealment. Applying this principle, the Court concluded that the Deputy Commissioner's re-estimation of turnover was beyond his competence, as it was a function assigned to the assessing authority under Section 14(4).

Ultimately, the Court dismissed the tax revision cases, upholding the decision of the Sales Tax Appellate Tribunal. The judgment clarified the scope of the revising authority's powers and affirmed that re-determining turnover in cases of escaped assessment falls under the assessing authority's jurisdiction, not the revisional authority.