1972 (7) TMI 86 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to assessment order under Mysore Sales Tax Act and Central Sales Tax Act for the year 1957-58. Failure to provide a reasonable opportunity to the petitioner for a best judgment assessment. Failure of the Commercial Tax Officer to summon necessary records for assessment. Interpretation of the powers under section 28(1) of the Act in allowing dealers to furnish information for proper assessment.

Analysis:
The petitioner, a registered dealer under both the Mysore Sales Tax Act, 1957, and the Central Sales Tax Act, 1956, challenged an assessment order made by the Commercial Tax Officer for the year 1957-58. The Commercial Tax Officer issued a notice under section 12(2) of the Mysore Sales Tax Act, deeming the petitioner's return as incorrect. The petitioner objected, leading to an order under section 12(3) which was later set aside by the court, directing a reevaluation with proper opportunity for the petitioner to present material.

After several years, a new notice was issued, and the petitioner reiterated not being the first dealer, requesting information from specific dealers to support this claim. However, the Commercial Tax Officer proceeded with an order, citing the petitioner's failure to rebut the presumption under section 6-A(2) of the Act. The petitioner's counsel contended that a proper opportunity for a best judgment assessment was not provided, as mandated by section 12(3) of the Act.

The court emphasized the power vested in the officer under section 28(1) of the Act, allowing the officer to require dealers to furnish information and documents for accurate assessment. The court rejected the argument that this power cannot be used to assist the petitioner in establishing their case, stating that it can be exercised to ensure proper assessment and benefit both the department and the dealers. Failure to utilize this power to aid the petitioner in presenting evidence was deemed a denial of the petitioner's entitlement to a fair opportunity under the Act.

Consequently, the court quashed the assessment order and remitted the case to the Commercial Tax Officer for reevaluation, emphasizing the petitioner's right to present all contentions. The petitioner was given an opportunity to provide precise details and request the officer to summon necessary materials under section 28 of the Act for a proper assessment.