1990 (6) TMI 199 - HC - VAT and Sales Tax

Issues Involved:
1. Validity of the assessment order under Section 12(3) of the Karnataka Sales Tax Act, 1957.
2. Compliance with principles of natural justice.
3. Opportunity to cross-examine the officer from the market committee.
4. Imposition of penalty under Section 12(4) of the Act.

Issue-wise Detailed Analysis:

1. Validity of the assessment order under Section 12(3) of the Karnataka Sales Tax Act, 1957:
The petitioner, a registered dealer and jaggery merchant, was issued a notice on July 25, 1980, by the assessing authority stating that the returns submitted for the year ending March 31, 1979, were incorrect and incomplete. The petitioner was asked to produce documents supporting the declared turnover and exemptions claimed. Despite the petitioner's reply requesting additional time to gather necessary certificates, the assessing authority proceeded to make a best judgment assessment based on information collected from the market committee. The assessment determined a taxable turnover of Rs. 6,29,460.31 and levied a tax of Rs. 3,360 along with additional tax and a penalty of Rs. 2,000 under Section 12(4) of the Act. The appellate authorities upheld this assessment.

2. Compliance with principles of natural justice:
The petitioner contended that the principles of natural justice were violated as the assessing authority relied on information from the market committee without providing an opportunity to cross-examine the concerned officer. The petitioner relied on the Supreme Court judgment in State of Kerala v. K.T. Shaduli Yusuff [1977] 39 STC 478, which held that denying the opportunity to cross-examine a third person from whom information was collected violated natural justice principles.

3. Opportunity to cross-examine the officer from the market committee:
The court noted that the petitioner did not request an opportunity to cross-examine the concerned officer of the market committee before the assessing authority, despite being informed in the proposition notice that the assessment was based on information from the market committee. The petitioner merely denied the information regarding the purchase of jaggery from the market committee without seeking to cross-examine the officer. Consequently, the assessing authority proceeded with the assessment based on the market committee's information.

4. Imposition of penalty under Section 12(4) of the Act:
The assessing authority exercised its power under Section 12(4) of the Act to impose a penalty of Rs. 2,000 on the petitioner. The appellate authorities upheld the penalty, rejecting the petitioner's contention regarding the violation of natural justice. The court held that the petitioner could not claim a violation of natural justice when he failed to request an opportunity to cross-examine the market committee officer before the assessing authority.

Conclusion:
The court dismissed the revision petition, stating that the petitioner did not seek an opportunity to cross-examine the market committee officer before the assessing authority. The court found no substance in the petitioner's contention that the appellate authorities were bound to grant such an opportunity when it was not requested initially. The court upheld the assessment order and the imposition of the penalty, concluding that there was no violation of natural justice principles.

Order:
(i) The revision petition is dismissed.
(ii) No costs.
Petition dismissed.

← Previous Next →