2003 (8) TMI 525 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to suo motu order of revision under section 36(1) of the Assam General Sales Tax Act, 1993 and fresh assessment orders.

Analysis:
The petitioner, a registered dealer, challenged the suo motu order of revision by the Deputy Commissioner of Taxes, Tinsukia Zone, under section 36(1) of the Act, along with the fresh assessment orders. The petitioner contended that the original assessments were not prejudicial to the state's revenue, as there was no tax evasion, and the revisional authority did not consider the documents presented. The court referred to previous judgments stating that revision can only be done if the order is erroneous and prejudicial to the state's interest. Notably, the court highlighted a case where it was held that suo motu revision cannot be entertained without jurisdictional errors by the assessing authority, which was lacking in the present case.

The dispute arose from the petitioner's purchase of tea from Padmadhar Tea Co., sent to the Gauhati Tea Auction Center for sale through Tea Brokers (P) Ltd. The tea was valued at Rs. 5,51,852 and Rs. 9,74,488 for two periods. The issue stemmed from the broker's certificate not mentioning the petitioner's name but that of Padmadhar Tea Co. The petitioner rectified this, but the revisional authority did not consider it, leading to suspicion and the impugned order. The petitioner argued that they owned the tea and received the sale price through the brokers, emphasizing no revenue loss to the state and no possibility of two sales for a single consignment. The petitioner obtained a corrected certificate from the brokers in their name.

Upon review, the court found that the revisional authority acted on mere suspicion without proper inquiry, resulting in alleged tax evasion by the petitioner. The court emphasized that suo motu revision cannot be based on mere suspicion and allowed the writ petition. The order by the Deputy Commissioner of Taxes and subsequent reassessment were set aside. The matter was remitted back to the Deputy Commissioner for a fresh inquiry, considering the petitioner's documents and determining ownership of the tea sold through the brokers for potential tax evasion. The Deputy Commissioner was directed to provide a hearing to the petitioner in this regard.