2004 (7) TMI 624 - HC - VAT and Sales Tax

Summary

Issues:
1. Correctness of the remand order by the Joint Commissioner of Commercial Taxes.
2. Jurisdiction of the Commissioner to interfere with the assessment order in a refund matter.

Analysis:
1. The case involved a reference under section 48 of the Bihar Finance Act, 1981 regarding an assessment order passed under section 17(2) of the Act for the period 1978-79. The petitioner claimed exemption from sales tax for exports to Nepal, leading to a refund claim. The Joint Commissioner set aside the assessment order and remanded the matter, which was challenged before the Commercial Taxes Tribunal. The Tribunal referred questions of law to the High Court regarding the validity of the remand order.

2. The High Court reframed the question to determine if the Joint Commissioner had the authority to interfere with the assessment order under section 46(4) of the Act while the matter was pending for refund consideration. Section 46(4) empowers the Commissioner to examine any order passed by another authority for legality or propriety. The Court noted that the Commissioner can exercise suo motu power upon discovering any illegality, even if the matter is under a different jurisdiction.

3. Drawing parallels with section 397 of the Code of Criminal Procedure, the Court emphasized the wide scope of the Commissioner's suo motu powers under section 46(4). Citing precedent, the Court held that the Commissioner can intervene to ensure the legality and propriety of orders, even if the matter is pending for a different purpose. The Court concluded that the Commissioner was justified in remanding the assessment order, dismissing the assessee's contentions.

4. In light of the analysis, the High Court answered the reference against the assessee, affirming the Commissioner's authority to exercise suo motu powers under section 46(4) of the Act. The reference was answered accordingly, upholding the legality of the remand order by the Joint Commissioner of Commercial Taxes.