1987 (8) TMI 433 - HC - VAT and Sales Tax

Summary

Issues:
Assessment under section 10 vs. section 12 of the Rajasthan Sales Tax Act, 1954; Validity of best judgment assessment; Application of section 10-B of the Act.

Analysis:
The case involved a dispute regarding the assessment of a registered firm and dealer under the Rajasthan Sales Tax Act, 1954 for the accounting period ending on Deepavali 1965. The Assistant Commercial Taxes Officer made an assessment under section 10 to the best of his judgment due to the assessee's non-appearance. Subsequently, the assessment was set aside, and a new assessment was made on July 20, 1981, imposing sales tax, penalties, and interest. The Deputy Commissioner (Appeals) relied on a previous court decision to quash the assessment, stating that the turnover had escaped assessment, necessitating compliance with section 12 notice requirements.

The assessing authority filed a second appeal before the Sales Tax Tribunal, which upheld the decision based on the previous court ruling. The assessing authority then filed a revision petition, questioning the Tribunal's interpretation of whether the assessment should have been made under section 12. The court differentiated the present case from the precedent, emphasizing that the initial and subsequent assessments were made under section 10(1)(b) and not under section 12. The court clarified that section 12 notice provisions were not applicable in this scenario.

The court rejected the argument that section 10-B, limiting assessments after 5 years, should apply retroactively, noting that it was inserted after the initiation of the assessment proceedings. Consequently, the court allowed the revision, set aside the Tribunal's order, and remanded the case for a fresh decision in accordance with the law. The court concluded that the Tribunal and the Deputy Commissioner erred in applying the previous court ruling, which was not relevant to the facts of the present case.