1990 (10) TMI 354 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of assessment orders under section 12(8) of the Orissa Sales Tax Act, 1947.
2. Requirement of notice to legal representative for assessment after the death of a dealer.
3. Interpretation of relevant provisions of the Orissa Sales Tax Act and Orissa Sales Tax Rules regarding assessment procedures.

Analysis:

Issue 1: Validity of assessment orders under section 12(8) of the Orissa Sales Tax Act, 1947.
The petitioner challenged the assessment orders under section 12(8) of the Orissa Sales Tax Act, 1947, for the years 1972-73 to 1975-76 as nullity. The Sales Tax Tribunal set aside the assessments, stating that notice should have been issued to the legal representative of the deceased dealer. Despite the Tribunal's direction, the Sales Tax Officer proceeded with the assessment without serving a fresh notice to the legal representative. The petitioner contended that service of the statutory notice was a condition precedent for jurisdiction in reassessment. The Court referred to the relevant provisions of the Act, emphasizing the need for a reasonable opportunity of being heard before assessment under section 12(8).

Issue 2: Requirement of notice to legal representative for assessment after the death of a dealer.
Section 19-A(2) of the Orissa Sales Tax Act enables the Commissioner to assess and determine tax and penalty when a dealer dies, requiring the executor, administrator, or legal representative to perform obligations. Rule 23 mandates the Commissioner to serve a notice on the dealer for furnishing a return within a specified period. The Court highlighted the importance of providing an opportunity to the legal representative for assessment after the dealer's death, as failure to serve notice on the legal representative could render the assessment invalid.

Issue 3: Interpretation of relevant provisions of the Orissa Sales Tax Act and Orissa Sales Tax Rules regarding assessment procedures.
The Court analyzed previous decisions and observed that unlike some other tax laws, the Orissa Sales Tax Act does not mandate service of notice on the dealer as a condition precedent for jurisdiction in reassessment under section 12(8). Notice in form VI prescribed in the Orissa Sales Tax Rules is considered a method of providing a reasonable opportunity for the dealer to be heard. The Court dismissed the writ applications, concluding that service of notice was not a condition precedent for initiating proceedings under section 12(8) of the Act.

In conclusion, the Court upheld the validity of the assessment orders under section 12(8) of the Orissa Sales Tax Act, emphasizing the importance of providing a reasonable opportunity for the legal representative in cases of assessment after the dealer's death. The judgment clarified the interpretation of relevant provisions of the Act and Rules regarding assessment procedures, highlighting the significance of procedural requirements for a fair assessment process.