1975 (10) TMI 90 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Jurisdiction of the Commissioner of Sales Tax to revise appellate orders under section 39(2) of the M.P. General Sales Tax Act, 1958.
2. Computation of the limitation period for issuing a notice under section 39(2) of the M.P. General Sales Tax Act, 1958.

Issue-wise Detailed Analysis:

1. Jurisdiction of the Commissioner of Sales Tax to Revise Appellate Orders:

The petitioner, a limited company, challenged the notice dated 23rd August 1969 and the order dated 18th April 1972 issued by the Commissioner of Sales Tax under section 39(2) of the M.P. General Sales Tax Act, 1958. The petitioner contended that the Commissioner had no power to revise an appellate order of the Deputy Commissioner of Sales Tax, as the appellate order was prejudicial to the interests of the revenue.

The Court examined the provisions under section 39 of the M.P. General Sales Tax Act, 1958, and compared them with the provisions of the C.P. and Berar Sales Tax Act, 1947. The petitioner relied on the observations of a Division Bench in Commissioner of Sales Tax, M.P., Indore v. Amarjeet Singh [1963] 14 S.T.C. 501, where it was held that the Commissioner could not revise an appellate order of the Deputy Commissioner under section 22-B of the C.P. and Berar Sales Tax Act, 1947. However, the Court noted that section 3 of the M.P. General Sales Tax Act, 1958, was differently worded, and the Deputy Commissioner of Sales Tax was an authority appointed to assist the Commissioner.

The Court referred to section 3 of the M.P. General Sales Tax Act, 1958, which enumerates various officers, including the Deputy Commissioner of Sales Tax, as authorities appointed to assist the Commissioner. The Court concluded that the Commissioner had the power to revise an appellate order of the Deputy Commissioner if it was prejudicial to the interests of the revenue. The Court also relied on the observations of a Division Bench of the Bombay High Court in H.B. Munshi, Commissioner of Sales Tax, Bombay v. Oriental Rubber Industries Pvt. Ltd. [1974] 34 S.T.C. 113, which supported the view that the Deputy Commissioner exercised powers independently but was still an authority appointed to assist the Commissioner.

2. Computation of the Limitation Period for Issuing a Notice:

The petitioner argued that the notice issued by the Commissioner was beyond the limitation period of three years as provided by the proviso to sub-section (2) of section 39 of the Act. The Court clarified that the period of three years should be computed from the date of issuance of the notice and not from the date of service. In the present case, the notice dated 23rd August 1969 was issued within three years from the date of the Deputy Commissioner's order dated 25th August 1966. Therefore, the notice was within the limitation period, and the question of limitation did not arise.

Conclusion:

The Court held that the Commissioner of Sales Tax had the power to revise the first appellate order of the Deputy Commissioner of Sales Tax under section 39(2) of the M.P. General Sales Tax Act, 1958. The notice and the order issued by the Commissioner were valid and did not call for any interference. The petition was dismissed, and there was no order as to costs. The outstanding amount of the security deposit was directed to be refunded to the petitioner.