1980 (4) TMI 280 - HC - VAT and Sales Tax

Summary

Issues:
1. Barred by limitation - Notices for reassessment under section 19(1) challenged.
2. Interpretation of "calendar year" in section 19(1).

Analysis:
1. The judgment concerns two petitions by a registered dealer challenging reassessment notices under section 19(1) of the Madhya Pradesh General Sales Tax Act, 1958. The dealer, M/s. Brijlal Sachdeva Brothers, contested the notices issued by the Sales Tax Officer on 10th October, 1972, for reassessment for the periods from 21st October, 1962, to 31st March, 1963, and from 1st April, 1963, to 31st March, 1964. The main contention raised was that the notices were barred by limitation. The dealer argued that the period of limitation for reassessment should be based on the law as it stood during the escapement period, ignoring subsequent amendments. However, the court disagreed with this argument, emphasizing that a dealer has no vested right in machinery provisions like sections 18 and 19, which are for quantification of tax. The court held that any change in the law extending the period of limitation before the original period's expiry does not affect any vested right of the dealer.

2. The second contention raised was the interpretation of the term "calendar year" in section 19(1). The dealer argued that a calendar year should be a period of twelve months starting from any date in a year, not necessarily from 1st January to 31st December. However, the court relied on the decision of a Full Bench in Kanhayyalal Sharma's case, which held that a calendar year commences from 1st January and ends on 31st December. The court rejected the dealer's argument and emphasized that no authority supported a different interpretation of a calendar year. The court distinguished a Supreme Court case cited by the dealer, stating that it did not address the meaning of "calendar year." Ultimately, the court dismissed the petitions, ruling that the notices for reassessment were not barred by limitation and ordered the refund of the security amount to the petitioner.

In conclusion, the court's judgment clarified that reassessment proceedings under section 19(1) can be initiated within five calendar years from the date of the assessment order, as per the relevant law in force. Additionally, the court reaffirmed the standard interpretation of a calendar year as starting from 1st January and ending on 31st December, rejecting the dealer's argument for an alternative interpretation.