1990 (11) TMI 359 - HC - VAT and Sales Tax

Summary

Issues:
Jurisdiction of assessing authority post-remand, Interpretation of remand order, Tax liability on sales made prior to February 3, 1983, Applicability of Forty-sixth Constitutional Amendment, Imposition of penalty under section 7AA and section 16(1)(n).

Jurisdiction of Assessing Authority Post-Remand:
The revision petition challenged the jurisdiction of the assessing authority in reassessing the petitioner for the entire year post-remand, contrary to the specific direction to assess only for the period between February 3, 1983, and March 31, 1983. The court emphasized that the assessing authority's jurisdiction was limited to the directions provided in the remand order, restricting the assessment to a specific area. The failure to confine the assessment to the specified period was deemed beyond the assessing authority's jurisdiction, as determined by the appellate authority.

Interpretation of Remand Order:
The court highlighted that the appellate authority's remand order controlled the jurisdiction of the assessing authority by imposing restrictions and directions within the order itself. The appellate authority's directive to assess the petitioner only for a specific period limited the assessing authority's jurisdiction to that timeframe. The court emphasized that the assessing authority was bound to act in accordance with the directions and restrictions outlined in the remand order, preventing a de novo assessment of the assessee.

Tax Liability on Sales Made Prior to February 3, 1983:
The court affirmed that the sales made by the assessee prior to February 3, 1983, were exempted from sales tax liability based on the Forty-sixth Constitutional Amendment and relevant judgments. It was established that the petitioner had not collected any sales tax on those sales, rendering them not chargeable to tax. The court cited the precedent that sales made in the restaurant to customers were not taxable, further supporting the exemption of sales of eatables prior to February 3, 1983.

Applicability of Forty-sixth Constitutional Amendment:
The court reiterated the significance of the Forty-sixth Constitutional Amendment in exempting certain sales from tax liability. The judgment emphasized that the sales of eatable items by the petitioner before February 3, 1983, fell under this exemption due to the absence of tax collection on those sales.

Imposition of Penalty under Section 7AA and Section 16(1)(n):
The court directed a reconsideration of the penalty imposition in light of the fact that no sales tax was chargeable on sales made before February 3, 1983. It underscored that the imposition of penalty should align with the exempt status of sales during that period, as determined by the appellate authority.

In conclusion, the revision petition was allowed, setting aside the orders of the Rajasthan Sales Tax Tribunal, Deputy Commissioner (Appeals-I), and Assistant Commercial Taxes Officer. The case was remitted to reassess the petitioner for the period between February 3, 1983, and March 31, 1983, in accordance with the specific directions provided in the remand order issued by the Deputy Commissioner (Appeals-I).