1977 (8) TMI 144 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Assessment of escaped turnover.
2. Jurisdiction of the revisional authority under Rule 80 of the Orissa Sales Tax Rules.
3. Delegation of powers to the Assistant Commissioner of Sales Tax.
4. Application of Section 12(8) of the Orissa Sales Tax Act.
5. Validity of the revisional order passed by the Assistant Commissioner.

Issue-wise Detailed Analysis:

1. Assessment of Escaped Turnover:
The petitioner, a dealer in electrical goods, was assessed for the year 1971-72 under section 12(4) of the Orissa Sales Tax Act. The Sales Tax Officer excluded a turnover of Rs. 1,30,095.49 from the gross turnover due to ignorance of its contravention under section 5(2)(A)(a)(ii). The Assistant Commissioner later assessed this escaped turnover under his revisional powers, leading to an additional tax demand of Rs. 9,156.45. The petitioner contended that the Assistant Commissioner lacked original jurisdiction to assess escaped turnover, which should be done under Section 12(8) by the Sales Tax Officer.

2. Jurisdiction of the Revisional Authority under Rule 80:
Rule 80 allows the Commissioner to revise orders passed by subordinate authorities. The Assistant Commissioner, acting under delegated powers, revised the assessment to include the escaped turnover. The court examined whether Rule 80 confers the power to assess escaped turnover, concluding that Rule 80 does not grant such power, especially when Section 12(8) specifically addresses escaped turnover.

3. Delegation of Powers to the Assistant Commissioner:
The Commissioner's delegation of powers to the Assistant Commissioner was limited to revising assessment orders, not assessing escaped turnovers. The court noted that the Assistant Commissioner, as an appellate authority, can only enhance turnover from sources already considered in the original assessment. The Assistant Commissioner overstepped by assessing a new source of turnover, which was not within his delegated powers.

4. Application of Section 12(8) of the Orissa Sales Tax Act:
Section 12(8) explicitly provides for the assessment of escaped turnover by the Sales Tax Officer within thirty-six months from the expiry of the relevant year. The court emphasized that the escaped turnover should be assessed under this section, not through revisional powers under Rule 80. The case law cited supported the view that specific provisions for escaped turnover assessment take precedence over general revisional powers.

5. Validity of the Revisional Order Passed by the Assistant Commissioner:
The court concluded that the Assistant Commissioner's order to assess the escaped turnover was without jurisdiction. The revisional jurisdiction under Rule 80 does not extend to assessing new sources of turnover not considered in the original assessment. Consequently, the impugned order was quashed.

Conclusion:
The court allowed the petition, quashing the Assistant Commissioner's order (annexure 2) and directing a writ of certiorari. The petitioner was awarded costs assessed at Rs. 200. The judgment underscores the importance of adhering to specific statutory provisions for assessing escaped turnover and limits the scope of revisional powers to ensure proper jurisdictional boundaries are maintained.