1966 (5) TMI 62 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of assessment based on repealed rule 28 under the Bengal Finance (Sales Tax) Act, 1941, as extended to Delhi.
2. Scope of power of review by the Sales Tax Officer under sub-section (4) of section 20 of the Act in light of a subsequent Supreme Court decision.
3. Applicability of the limitation period under section 11(2a) of the Act for assessments made for specific quarters.

Analysis:
1. The petitioner-firm challenged the assessment order based on rule 28, which was repealed in November 1959, as unconstitutional due to an alleged illegal delegation of legislative power. However, the court noted that the firm voluntarily opted for a 30% exemption under rule 28 as they couldn't provide labor details, making the assessment valid. The court cited a previous case where rule 28 was deemed invalid but clarified that the voluntary exemption acceptance didn't render the assessment illegal.

2. The petitioner-firm contended that the Sales Tax Officer's power of review should have limitations akin to those in the Civil Procedure Code. The court rejected this argument, emphasizing that the term "review" doesn't have a fixed legal meaning and cited legal definitions to support its stance. It highlighted that wider review powers were likely granted to rectify injustices, and in this case, the officer was justified in reviewing the order due to a reversal by the Supreme Court on tax liability for building contractors.

3. Regarding the limitation period under section 11(2a) of the Act, the court clarified that the four-year limitation period is calculated from the end of the relevant year, not the specific quarter. As the assessment order was issued before March 31, 1960, within four years from the end of the year 1955-56, the limitation provision wasn't applicable. Consequently, the court dismissed the petition challenging the assessment order, ruling in favor of the Sales Tax Officer's decision.