1987 (5) TMI 359 - HC - VAT and Sales Tax

Issues Involved:
1. Whether an assessee can seek intervention by the Deputy Commissioner under section 35 of the Kerala General Sales Tax Act, 1963.
2. Whether the Deputy Commissioner has the jurisdiction to revise assessment orders that are appealable.
3. Whether the suo motu power of revision under section 35 can be invoked by an assessee.
4. Interaction between sections 35 and 36 of the Kerala General Sales Tax Act, 1963.

Detailed Analysis:

1. Assessee Seeking Intervention under Section 35:
The primary issue is whether an assessee can seek intervention by the Deputy Commissioner under section 35 of the Kerala General Sales Tax Act, 1963. The petitioner, running a small printing press, was assessed at an 8% tax rate for the years 1980-81, 1981-82, and 1982-83, treating the printed items as "paper products." The petitioner contended that these items should be classified as "general goods" based on previous court decisions and a clarification from the Board of Revenue. The assessing authority refused to rectify the assessments, leading the petitioner to invoke the Deputy Commissioner's suo motu power of revision under section 35 to correct the alleged illegality.

2. Jurisdiction to Revise Appealable Orders:
The question arises whether the Deputy Commissioner can revise orders that are appealable. The court noted that section 35 allows the Deputy Commissioner to call for and examine any order passed by a subordinate officer, while section 36 restricts revision to non-appealable orders. The court emphasized that section 35 is not limited to revising orders prejudicial to the Revenue but can also pass orders favorable to the assessee. The court cited previous decisions, including those of the Supreme Court, affirming that the Deputy Commissioner's power under section 35 is of wide amplitude and can be exercised to correct any error or illegality in the assessment, even if the order is appealable.

3. Suo Motu Power of Revision by an Assessee:
The court examined whether the suo motu power of revision under section 35 can be invoked by an assessee. The court referenced several decisions, including Bombay Ammonia Pvt. Ltd. v. State of Tamil Nadu and Board of Revenue v. Raj Brothers Agencies, which held that the suo motu power could be exercised at the instance of an assessee. The court highlighted that the purpose of the suo motu power is to safeguard the interests of both the exchequer and the assessee, allowing the Deputy Commissioner to correct any error or illegality in the assessment.

4. Interaction Between Sections 35 and 36:
The court addressed the interaction between sections 35 and 36, noting that section 36 restricts revision to non-appealable orders, while section 35 has no such limitation. The court rejected the contention that section 36 would become meaningless if section 35 could be invoked by an assessee. The court concluded that the Deputy Commissioner is bound to exercise his power under section 35 to correct any injustice, regardless of whether the order is appealable or whether the assessee has invoked section 36.

Conclusion:
The court held that an assessee is entitled to invoke the suo motu power of revision of the Deputy Commissioner under section 35. The Deputy Commissioner must exercise this power to correct any error, illegality, or impropriety in the assessment, even if the order is appealable. The court quashed the Deputy Commissioner's order, which declined to exercise jurisdiction, and directed him to deal with the petitions on their merits. The petition was allowed, with no order as to costs.

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