1986 (9) TMI 397 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Validity of notices in Form VI-A issued for assessment as a casual dealer.
2. Validity of notices in Form VI-B issued due to defective way bills.

Issue 1: Validity of Notices in Form VI-A

The petitioner, a government company, challenged the notices issued under Form VI-A, which were served on 6th May 1984 and 4th August 1984, for assessment as a casual dealer under the Orissa Sales Tax Act, 1947. The relevant rule, Rule 28-B, mandates that a casual dealer must file a return within 24 hours upon receiving a notice in Form VI-A, failing which the Sales Tax Officer may proceed with a provisional assessment to the best of his judgment. The court noted that Rule 28-B requires giving adequate opportunity to the person to whom the notice is issued. However, the statutory notice in Form VI-A stated that no further opportunity would be given to the person, which is inconsistent with Rule 28-B. The court emphasized that taxing statutes must be rigidly construed, and any inconsistency with the procedural law renders the notice unsustainable. Consequently, the notices in Form VI-A (annexures 1-B and 1-C) were quashed.

Issue 2: Validity of Notices in Form VI-B

The petitioner also contested the notices in Form VI-B, issued on 25th May 1985 and 26th May 1985, due to defective way bills. The defect cited was the absence of an undertaking required by the Commissioner. Upon examining Section 16-A, Rule 94, and the statutory way bill format, the court found no provision mandating such an undertaking. The court observed that the way bills were complete and correct in all respects, and the additional requirement of an undertaking, not envisaged by the statute, could not justify the issuance of notices in Form VI-B. The court held that any action exceeding statutory requirements constitutes an excessive exercise of power and infringes on the rights of individuals. Since no statutory provision authorized the Commissioner to demand such an undertaking, the notices in Form VI-B (annexures 1 and 1-A) were deemed unsustainable and quashed.

Conclusion:

The court concluded that both sets of notices-Form VI-A and Form VI-B-were invalid. The notices in Form VI-A were inconsistent with Rule 28-B, and the notices in Form VI-B were issued in excess of the statutory power. Thus, the writ application was allowed, and all contested notices were quashed. No costs were awarded.