2000 (3) TMI 1064 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of proceedings of reassessment under section 19(1) of the M.P. General Sales Tax Act, 1958.
2. Legality of the order of reassessment passed by the Assistant Commissioner of Sales Tax, Indore.
3. Revision of the order by the Additional Commissioner of Sales Tax, M.P., Indore.
4. Computation of limitation period for the second notice issued under section 19(1) of the Act.

Analysis:
1. The petitioner, a partnership firm, was reassessed under section 19(1) of the Act for the second time, challenging the proceedings initiated by the Assistant Commissioner of Sales Tax, Indore, through a notice and subsequent order of reassessment. The petitioner contended that the second notice was time-barred as it exceeded the 5-year limitation period from the date of the original assessment order. The respondents argued that the limitation period should be computed from the date of the first reassessment order, not the original assessment.

2. The court considered the interpretation of the expression "order of assessment" in section 19(1) of the Act based on precedents like Commissioner of Sales Tax, M.P. v. Jeewa Khan and J.K. Textiles v. Additional Sales Tax Officer. It was established that an "order of assessment" does not include a reassessment order. The court noted that the amendment to section 19(1) did not alter this interpretation, emphasizing that the word "assessment" refers to the original assessment under section 18.

3. The Additional Commissioner's attempt to distinguish previous decisions based on the unamended provision of section 19(1) was deemed misconceived. Reference to a Supreme Court decision in Deputy Commissioner of Commercial Taxes v. H.R. Sri Ramulu was also found irrelevant as it pertained to a different context of revisional powers. The court clarified that the limitation period for second reassessment should be calculated from the date of the original assessment order, not the first reassessment order.

4. Consequently, the court ruled in favor of the petitioner, declaring the second reassessment proceedings as time-barred. The order of reassessment and the revision order were quashed, leading to the allowance of the petition. The notice and orders in question were invalidated, and no costs were awarded, with any security amount to be refunded to the petitioner upon verification.