1971 (9) TMI 175 - HC - VAT and Sales Tax

Summary

Issues:
1. Whether the petitioner, an advertising agent, is liable to be considered a dealer under the Madras General Sales Tax Act and the Central Sales Tax Act.
2. Whether the petitioner's applications for rectification under section 55 of the Madras General Sales Tax Act and rule 5(9) of the Central Sales Tax Rules are maintainable despite not challenging the original assessment orders in higher hierarchy.
3. Whether the orders of the Sales Tax Appellate Tribunal regarding the petitioner's status as a dealer are sufficient grounds for filing rectification applications.

Analysis:
1. The petitioner, an advertising agent, contested its classification as a dealer under the Madras General Sales Tax Act and the Central Sales Tax Act. The petitioner voluntarily submitted returns for several years but challenged assessments for 1961-62 and 1962-63. The Tribunal later ruled in favor of the petitioner, determining it was not a dealer for those years. Subsequently, the petitioner filed rectification applications for later years based on the Tribunal's decision. The court noted that the petitioner did not raise objections to its dealer status during the original assessments, and failure to do so precluded invoking section 55 for rectification. The court emphasized that the assessing authority was not tasked with determining the petitioner's dealer status, rendering the rectification applications invalid.

2. The petitioner argued that despite accepting the original assessment orders as final, it could still seek rectification under section 55 if filed within the prescribed time. However, the court held that the petitioner's failure to challenge its dealer status during the original assessments precluded invoking section 55 for rectification. The court emphasized that statutory functionaries cannot rectify errors not raised during the assessment process, and the absence of objections during assessment precluded invoking section 55 for rectification.

3. The court analyzed the petitioner's reliance on the Tribunal's orders regarding its dealer status for filing rectification applications. The court noted that the petitioner's rectification applications were based on the Tribunal's decision, which determined the petitioner was not a dealer for specific years. However, the court held that the petitioner should have raised objections to its dealer status during the original assessments to invoke section 55 for rectification. The court emphasized that the Tribunal's decision was the sole basis for the rectification applications, indicating that the petitioner should have raised objections earlier to challenge its dealer status effectively.