2000 (4) TMI 802 - AT - VAT and Sales Tax

Summary

Issues Involved:
1. Legality of the revision of assessment by a Deputy Commercial Tax Officer for the assessment year 1983-84.
2. Validity of the tax levy on the sale of buses as separate commodities from their chassis and bus bodies.
3. Whether the reassessment based on a change of opinion is permissible.

Detailed Analysis:

1. Legality of the Revision of Assessment by a Deputy Commercial Tax Officer:
The petitioner contended that the revision of assessment for the year 1983-84 by the Deputy Commercial Tax Officer was invalid because the original assessment was conducted by a higher-ranking Commercial Tax Officer. The petitioner cited the Madras High Court's judgment in *Muthu Metals v. State of Tamil Nadu* (1993) 3 MTCR 300, which emphasized that an officer of equal or superior rank should undertake such revisions to maintain administrative discipline and propriety. However, the Tribunal clarified that the judgment in *Muthu Metals* was specific to the powers of the Enforcement Wing officers and did not address the competency of assessing officers within the assessment wing. It was noted that both the Deputy Commercial Tax Officer and the Commercial Tax Officer are competent to assess an assessee within their jurisdiction. Therefore, the revision of assessment by the Deputy Commercial Tax Officer was deemed valid under Section 16(1) of the Tamil Nadu General Sales Tax Act, 1959.

2. Validity of the Tax Levy on the Sale of Buses as Separate Commodities:
The petitioner argued that since the chassis and bus bodies had already suffered tax locally, the sale of buses should not be treated as a separate commercial commodity subject to additional tax. The Tribunal referred to several precedents, including *Cholan Roadways Corporation v. State of Tamil Nadu* [1994] 92 STC 159 and *State of Karnataka v. M. Madhvaraj* [1993] 91 STC 572, which established that buses sold as a single unit are distinct commercial commodities and liable to tax at 15 percent. The Tribunal held that the sale of a complete bus, which includes both the chassis and the bus body, constitutes a separate assessable commodity under Entry 3 of the First Schedule to the Act. Therefore, the levy of tax on the sale of old buses at 15 percent single point was upheld.

3. Reassessment Based on a Change of Opinion:
The petitioner contended that the reassessment was invalid as it was based on a mere change of opinion. However, the Tribunal referred to the Kerala High Court's decision in *Deputy Commissioner of Sales Tax v. T.P. Elias* [1993] 90 STC 25, which allowed reassessment on the basis of a change of opinion. Furthermore, the Tribunal noted that the revising authority provided clear reasons for revoking the exemption on second sales of buses, thus satisfying the requirement for objective reasoning as stipulated in *Brilliant Match Works v. Deputy Commercial Tax Officer* [1974] 33 STC 320. Therefore, the reassessment was deemed valid.

Conclusion:
The Tribunal concluded that the revision of assessment by the Deputy Commercial Tax Officer for the year 1983-84 was lawful, the sale of buses as separate commercial commodities was correctly taxed at 15 percent, and the reassessment based on a change of opinion was permissible. Consequently, the tax revision cases for the assessment years 1983-84 and 1984-85 were dismissed, and the orders of the Appellate Tribunal were upheld.