1994 (9) TMI 340 - HC - VAT and Sales Tax

Issues Involved:
1. Jurisdiction of the Joint Commissioner of Commercial Taxes (Administration) under Section 15(1) of the Karnataka Tax on Entry of Goods Act, 1979.
2. Legality and correctness of the assessment orders being prejudicial to the interest of the Revenue.

Issue-wise Detailed Analysis:

Issue 1: Jurisdiction of the Joint Commissioner of Commercial Taxes (Administration) under Section 15(1) of the Act

Contentions of the Appellant:
- The Joint Commissioner of Commercial Taxes (Administration), who passed the impugned order, had no jurisdiction under Section 15(1) of the Act.
- The notification dated July 31, 1981, empowering the Deputy Commissioner of Commercial Taxes (Administration) did not authorize the Joint Commissioner to pass such an order.
- The notification was outside the scope of Section 15(1) as it did not involve any special empowerment but was merely a general empowerment.
- A later notification dated January 19, 1993/April 22, 1993, transferred the jurisdiction to the Additional Commissioner of Commercial Taxes, thereby nullifying the Joint Commissioner's authority.

Contentions of the Respondent:
- The Joint Commissioner of Commercial Taxes (Administration) had jurisdiction as per the notification dated July 31, 1981, which was not rescinded or superseded.
- The term "Deputy Commissioner" in the notification should be read as "Joint Commissioner" due to subsequent amendments in the Act.
- Section 20 of the Karnataka General Clauses Act, 1899, supports the interpretation that terms in statutory notifications should align with the parent Act.

Court's Analysis and Conclusion:
- The notification dated July 31, 1981, empowered the Deputy Commissioners of Commercial Taxes (Administration) to exercise revisional powers under Section 15(1).
- The Supreme Court's judgment in the case of State of Gujarat v. Chaturbhuj Maganlal clarified that such notifications amounted to special empowerment.
- The term "Deputy Commissioner" as used in the notification must be read as "Joint Commissioner" following the amendment by Karnataka Act 5 of 1993.
- The notification dated January 19, 1993/April 22, 1993, did not affect the revisional proceedings pending before specially empowered officers under Section 15(1).
- The Joint Commissioner of Commercial Taxes (Administration) had jurisdiction to pass the impugned order on July 22, 1993.

Conclusion on Jurisdiction:
The Joint Commissioner of Commercial Taxes (Administration), Bangalore, had the jurisdiction to exercise powers under Section 15(1) of the Act.

Issue 2: Legality and Correctness of the Assessment Orders

Contentions of the Appellant:
- The revisional authority erred in holding that the assessment orders were erroneous and prejudicial to the interest of the Revenue.
- The appellant claimed that the goods were either purchased from local dealers who had paid entry tax or were sold from godowns outside the municipal limits.

Contentions of the Respondent:
- The assessing authority accepted the appellant's claims without sufficient evidence, resulting in orders prejudicial to the Revenue.
- The appellant failed to produce necessary evidence such as Form No. 30 to substantiate the claim that the goods were tax-suffered.
- The appellant's alternative claim that the goods were stored and sold outside municipal limits was inconsistent and unsupported by evidence.

Court's Analysis and Conclusion:
- The appellant failed to discharge the burden of proof under Section 28A of the Act to show that the goods were not liable to entry tax.
- The assessing authority's orders were based on the appellant's unsubstantiated claims, amounting to an error of law.
- The revisional authority was justified in revising the assessment orders and computing the taxable turnover and tax payable.
- The appellant's attempt to introduce additional evidence at the appellate stage was rejected as it was an afterthought and not part of the original proceedings.

Conclusion on Merits:
The revisional authority's orders revising the assessment orders and computing the taxable turnover and tax payable were upheld as legal and proper.

Final Judgment:
The appeals are dismissed with no order as to costs. The Joint Commissioner of Commercial Taxes (Administration), Bangalore, had jurisdiction, and the revisional orders revising the assessment orders were justified.

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