1976 (5) TMI 92 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Validity of the notice issued by the Assistant Commissioner of Commercial Taxes.
2. Power of the Commissioner in exercise of his jurisdiction of revision under the Bengal Finance (Sales Tax) Act, 1941.
3. Construction of the order passed by the Commissioner on the revisional application.

Detailed Analysis:

Issue 1: Validity of the Notice Issued by the Assistant Commissioner of Commercial Taxes
The petitioner challenged the notice issued by the Assistant Commissioner on 23rd July 1974, which directed the petitioner to show cause why the entire claim of Rs. 49,82,246.90 should not be disallowed in terms of the latest Supreme Court decision. The court found that the Assistant Commissioner did not have jurisdiction to reconsider the claim for exemption of Rs. 49,82,246.90, which had already been allowed by the appellate authority. The impugned notice was set aside and quashed.

Issue 2: Power of the Commissioner in Exercise of His Jurisdiction of Revision
The court examined the scope of the Commissioner's revisional powers under Section 20 of the Bengal Finance (Sales Tax) Act, 1941. It was noted that the Commissioner could revise any assessment made or order passed by subordinate officers. However, before passing an order prejudicial to a person, the Commissioner must provide a reasonable opportunity for the person to be heard and must record reasons for the revision. The court emphasized that the Commissioner cannot revise an order to the detriment of a party based on a revision application by that party unless a specific notice is given.

Issue 3: Construction of the Order Passed by the Commissioner
The court interpreted the Commissioner's order dated 4th December 1973, which directed the Assistant Commissioner to verify the details of the sales amounting to Rs. 68,518.17. The court concluded that the Commissioner's order did not set aside the entire appellate order but only the portion related to the claim of Rs. 68,518.17. The Commissioner had not provided any grounds for disallowing the claim of Rs. 49,82,246.90, which had been previously allowed by the appellate authority. Therefore, the Assistant Commissioner was not authorized to reconsider the entire claim.

Conclusion:
The court allowed the petition, setting aside and quashing the impugned notice dated 23rd July 1974. The court clarified that this order does not prevent the Commissioner from passing a fresh order to revise the appellate order if deemed necessary and in accordance with the law. The rule was made absolute with no order as to costs.