1984 (4) TMI 274 - HC - VAT and Sales Tax

Summary

Issues:
Whether the assessment of the respondent for the period from 1st April, 1954, to 31st December, 1959, made by the Sales Tax Officer, Enforcement Branch, Bombay, was barred by limitation.

Detailed Analysis:
The respondent-dealer, not registered under the Bombay Sales Tax Act of 1953, had its business in Calcutta and sold goods in the State of Bombay exceeding the prescribed limit under the Act. The Sales Tax Officer assessed the dealer for the period from 1954 to 1959 as an unregistered dealer, imposing a penalty for failure to register. The Assistant Commissioner reduced the tax and penalty, which was further modified on revision. The Maharashtra Sales Tax Tribunal set aside the assessment as beyond the limitation period, based on precedents. The question referred to the High Court stemmed from this Tribunal decision.

Chapter V of the Act deals with assessment of tax, where Section 14(6) empowers the Collector to assess tax due from an unregistered dealer to the best of judgment, upon information of tax liability. Section 15 addresses turnover escaping assessment. The Supreme Court in a relevant case clarified that the provisions under Section 33(6) of the Bombay Sales Tax Act of 1959 apply to unregistered dealers evading tax willfully, without a limitation period. It was held that there is no overlap between Section 33(6) and Section 35 of the Act. The High Court applied this Supreme Court decision to the present case, concluding that the assessment was not barred by limitation.

In light of the Supreme Court ruling, the High Court answered the question in the negative, favoring the department. The respondent was directed to pay the costs of the reference. The judgment upheld the assessment made by the Sales Tax Officer, Enforcement Branch, Bombay, for the mentioned period, rejecting the limitation argument raised by the dealer.