1974 (11) TMI 86 - HC - VAT and Sales Tax

Issues Involved:

1. Jurisdiction of the Assistant Commissioner to revise the assessment.
2. Limitation period for initiating revision proceedings.
3. Validity of the transfer of files and creation of the Central Section.
4. Delegation of powers by the Commissioner.
5. Scope of revisional powers under Section 20(3) of the Bengal Finance (Sales Tax) Act, 1941.
6. Alternative remedy as a bar to the writ petition.

Detailed Analysis:

1. Jurisdiction of the Assistant Commissioner to Revise the Assessment:

The court held that the Assistant Commissioner of Commercial Taxes, Central Section, West Bengal, had no authority to assume jurisdiction over the petitioner's files as there was no valid order passed by the Commissioner for such transfer. The purported transfer by the Commercial Tax Officer, China Bazar, and the assumption of jurisdiction by the Commercial Tax Officer, Central Section, over the petitioner's case was deemed ultra vires.

2. Limitation Period for Initiating Revision Proceedings:

The court concluded that the impugned proceeding was time-barred. It was noted that if the proceeding was initiated by the Commissioner suo motu, a four-year limitation period under sub-rule (5) of rule 80 would apply. However, since the proceeding was initiated on an application by an inferior officer, sub-rule (2) of rule 80, which provides a limitation of 60 days, was applicable. The benefit of the proviso to rule 80(2) for condoning the delay was neither claimed nor urged at the hearing.

3. Validity of the Transfer of Files and Creation of the Central Section:

The court found that the creation of the Central Section having jurisdiction over the whole of Bengal could not be questioned. However, the transfer of the petitioner's case from China Bazar to the Central Section was not validated by any order of the Commissioner nor appeared to be any delegation of power to the Commercial Tax Officer. The transfer and assumption of jurisdiction were thus ultra vires.

4. Delegation of Powers by the Commissioner:

The court held that the delegation of powers by the Commissioner to the Assistant Commissioner to revise an order passed by the Commercial Tax Officer remained valid even if the Commissioner who made the delegation had vacated office. The delegation was made in an official capacity, not personal, and continued unless revoked.

5. Scope of Revisional Powers under Section 20(3) of the Bengal Finance (Sales Tax) Act, 1941:

The court opined that the power of revision conferred on the Commissioner under Section 20(3) is of the widest amplitude and includes the power to enhance the taxable turnover by bringing into account the alleged escaped turnover. The court rejected the contention that the power of revision cannot be utilized for enhancing the taxable turnover, noting that the Bengal Act does not contain any express provision for assessment of escaped turnover, and the power of revision is not circumscribed by any limitation save those expressly made in the statute.

6. Alternative Remedy as a Bar to the Writ Petition:

The court rejected the contention that the alternative remedy operated as a bar to the initiation of the proceeding under Article 226(1) of the Constitution, particularly when a question of jurisdiction of the authority to issue the impugned order was involved. The application was deemed maintainable in law.

Conclusion:

The appeal was allowed, and the judgment and order under appeal were set aside. The rule was discharged, and all interim orders were vacated. The court granted a stay of the operation of this order for eight weeks from the date of the judgment.

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