1994 (5) TMI 259 - HC - VAT and Sales Tax

Summary

Issues:
Provisional assessment under Sales Tax Act, validity of final assessment order, impact of appellate authority's decision on final assessment.

Analysis:
The petitioner's firm conducted business of manufacturing and selling rice, subject to provisional assessment under section 7B of the Sales Tax Act. A survey led to additional tax, penalty, and interest. The Deputy Commissioner (Appeals) partially allowed the appeal against the provisional assessment. Subsequently, the matter was taken to the Rajasthan Sales Tax Tribunal by both the petitioner and the Revenue. The Tribunal dismissed the appeals as infructuous due to a final assessment order under section 10(3) being passed for the relevant period. The petitioner argued that the final assessment couldn't ignore the provisional order, citing a decision in Assistant Commercial Taxes Officer v. Chauhan Enterprises.

The High Court delved into the provisions of the Act, emphasizing the provisional nature of assessments under sections 7A and 7B. It highlighted that amounts paid under provisional assessments are adjustable towards final tax liability under section 10. The Court clarified that orders under sections 7A and 7B are provisional and subject to final assessment. It addressed the question of whether the assessing authority is bound by appellate decisions on provisional assessments. Drawing an analogy to temporary injunctions in civil suits, the Court explained that provisional assessments are subject to final assessment, akin to a temporary injunction being superseded by a permanent injunction decision.

The Court examined a judgment cited by the petitioner, noting the specific circumstances of that case. It concluded that the Tribunal was justified in dismissing the appeals challenging provisional assessment as infructuous due to the final assessment made during the proceedings. The Court dismissed the revision petition, affirming the Tribunal's decision.