1966 (11) TMI 80 - HC - VAT and Sales Tax

Summary

Issues:
Claim for lower rate of tax under section 8 of the Central Sales Tax Act for inter-State transactions rejected. Commissioner of Commercial Taxes set aside the appellate order granting reduced rate. Jurisdiction of the revising authority under section 21 of the Mysore Sales Tax Act challenged.

Analysis:
The petitioner, an assessee to sales tax, claimed a lower rate of tax for certain inter-State transactions under section 8 of the Central Sales Tax Act of 1956. The original assessing authority rejected the claim due to non-production of 'C' Forms. The petitioner appealed to the Deputy Commissioner, who accepted some declarations produced before him and granted a reduced rate. However, the Commissioner of Commercial Taxes, in a suo motu revision, set aside the appellate order, leading to this writ petition challenging the revisional order's jurisdiction.

The revising authority justified its interference by citing illegality, impropriety, or irregularity in the appellate order. It contended that the Act did not allow an assessee to produce 'C' Forms post-assessment. The revising authority's opinion was that the appellate order was illegal, improper, or irregular, as detailed in the revision order. The essence of the matter lay in the requirement for the assessee to provide necessary information for concessional rates, as prescribed by rules, enabling the assessing authority to determine liability accurately.

The High Court highlighted that the appellate authority had the power to correct errors and pass orders based on correct facts and law. The petitioner's complaint of insufficient opportunity to produce 'C' Forms before the original authority was accepted by the appellate authority. The Court emphasized that the forms' information, not their annexation to returns, was crucial for assessment completion. The appellate authority's decision to grant relief based on forms produced before it was deemed legally sound.

Regarding the Madras High Court's strict view on late submission of 'C' Forms, the High Court disagreed, emphasizing the appellate authority's duty to correct mistakes. The Court opined that refusal to accept forms due to proven laches was permissible but not mandatory in all cases. In this instance, the appellate authority acted within its powers to rectify the original authority's lapses.

The High Court addressed the jurisdictional aspect, noting that the revising authority's order was appealable but found it to be without jurisdiction. The Court allowed the writ petition, setting aside the Commissioner's order and restoring the Deputy Commissioner's appellate order. The judgment emphasized the appellate authority's discretion to correct errors and the revising authority's limited scope for interference.