1992 (2) TMI 344 - HC - VAT and Sales Tax

Summary

Issues:
- Assessment of sales tax in different circles by a works contractor
- Jurisdiction of Sales Tax Officers in different circles
- Application of Rule 6-A of the Orissa Sales Tax Rules, 1947
- Authority of Commissioner to direct registration in one circle

Analysis:
The judgment dealt with the issue of whether a works contractor is liable to be assessed to sales tax in different circles or only by the Sales Tax Officer in one circle. The petitioner, a works contractor, had executed works in various circles but was registered only in the Balasore Circle. The Commissioner passed an order allowing the petitioner to be registered in Balasore Circle for all transactions in different circles. The order directed the petitioner to submit returns and pay tax in the Balasore Circle for works executed in sixteen circles. The petitioner was assessed by the Sales Tax Officer, Balasore Circle, for the relevant periods. However, the Sales Tax Officer, Bhubaneswar I Circle, issued a notice calling for accounts, contrary to the Commissioner's order. The court examined Rule 3(4) which allows the State Government to divide areas into circles and the Commissioner to authorize Sales Tax Officers to exercise jurisdiction. Rule 6-A empowers the Commissioner to direct registration in one circle for dealers operating in multiple circles. The court held that the Commissioner's order directing registration in Balasore Circle superseded the jurisdiction of other Sales Tax Officers. Therefore, the notice from the Sales Tax Officer, Bhubaneswar I Circle, was unauthorized and was quashed.

The judgment emphasized that the Commissioner's order directing registration in one circle for assessment purposes applies retrospectively to transactions already completed. The authority of Sales Tax Officers to assess is derived from the Commissioner's conferment of power, which can be superseded by subsequent directives. As the petitioner had already been assessed in the Balasore Circle as per the Commissioner's order, the Sales Tax Officer, Bhubaneswar I Circle, had no jurisdiction to assess the petitioner for the same transactions. The court concluded by allowing the writ petition, with no order as to costs, indicating that the petitioner was entitled to be assessed only by the Sales Tax Officer in the Balasore Circle as directed by the Commissioner.

In a concurring opinion, Justice Mahapatra agreed with the decision to allow the writ petition, affirming that the petitioner should be assessed only in the Balasore Circle as per the Commissioner's directive. The judgment clarified the jurisdictional issues concerning works contractors operating in multiple circles and underscored the significance of the Commissioner's authority in directing registration and assessment procedures to ensure uniformity and avoid overlapping assessments.