1968 (10) TMI 93 - HC - VAT and Sales Tax

Summary

Issues: Validity of order assessing escaped turnover under section 12-A of Mysore Sales Tax Act, 1957; Constitutionality of provisions authorizing power by multiple authorities.

The judgment delivered by the High Court of Mysore addressed the validity of an order made by the Deputy Commissioner of Commercial Taxes assessing the escaped turnover of the petitioner under section 12-A of the Mysore Sales Tax Act, 1957 for the assessment year 1960-61. The petitioner challenged the order on two grounds. Firstly, it was contended that the Deputy Commissioner could exercise power under section 12-A only in the context of a pending appeal before him, which was refuted based on a Supreme Court pronouncement that clarified the term "appellate authority" as merely descriptive and not limited to a pending appeal. Secondly, the petitioner argued that the provisions of section 12-A allowing multiple authorities to assess escaped turnover were unconstitutional. The court observed that the statutory provisions created three authorities - the Commercial Tax Officer, the appellate authority (Deputy Commissioner), and the revising authority (Commissioner of Commercial Taxes or Deputy Commissioner), leading to a situation where different dealers had varying appeal rights based on the selecting authority. This disparity was held to violate Article 14 of the Constitution, rendering section 12-A void.

The court further analyzed the appeal process under the Act as it stood at the time of the impugned order. It was noted that under the existing provisions, there was no avenue for appeal from an order made by the Deputy Commissioner under section 12-A, unlike if the Commercial Tax Officer had made the assessment. This lack of appeal rights for certain cases was deemed unjust and contrary to established principles of appeal processes. Drawing parallels to previous legal precedents, the court highlighted the importance of uniform appeal rights for all cases falling under similar statutory provisions to ensure fairness and adherence to constitutional principles.

In conclusion, the court set aside the order made by the Deputy Commissioner, emphasizing the unconstitutionality and lack of appeal mechanisms under section 12-A as it existed at the relevant time. The judgment underscored the need for statutory provisions to provide clear guidance and ensure equal treatment for all parties involved in assessment proceedings. The decision ultimately favored the petitioner, with costs not awarded to any party.