2015 (12) TMI 1477 - HC - VAT and Sales Tax

Levying of tax under the Rajasthan Tax on Entry of Motor Vehicles Into Local Area Act, 198 - Jurisdiction of AO - Held that - when one statute make a reference to another Act then it cannot be said that provision of that Act cannot be read into it, and as observed earlier when all the provisions of Rajasthan Sales Tax Act, 1954 are made applicable mutatis mutandis to the provisions under the Act, therefore, the assessment order passed by the Assistant Commissioner, Anti Evasion Wing, though may not be proper but the entire assessment order could not have been quashed and set aside for all times to come. At least when liability under the Act is fastened on an assessee who imports vehicle into the State of Rajasthan for personal use and such intention is to use the vehicle for all times to come, the provisions of the Act cannot be made redundant as held by the Tax Board that the Assistant Commissioner, Anti Evasion Wing had no jurisdiction. CTO under Section 3(2)(b) had the jurisdiction to assess the assessee according to the area where one ordinarily resides or carries on business or provides any service, therefore, in the instant case assessment will have to be passed by the CTO in accordance with the place of residence or the place of business or place of providing service. In case the respondent-assessee is already assessed to tax by a particular CTO, the same officer would have jurisdiction to assess the assessee and in case some of the assessees are not assessed to sales tax, then the CTO will get jurisdiction to assess according to the place of residence of the person. - order of the Tax Board is quashed and set aside, the order of Dy. Commissioner(Appeals) insofar as direction to assess the assessee by the Assessing Officer (CTO) having jurisdiction, as above, is upheld - Decided in favour of Revenue.

Issues Involved:
1. Jurisdiction of the Assistant Commissioner, Commercial Taxes Department, Anti Evasion Wing.
2. Legality of the Rajasthan Tax Board's decision to set aside the appellate authority's order.
3. Applicability of Section 3(2)(b) of the Act of 1988 to non-dealers.
4. Jurisdiction of Anti Evasion Officers under Sections 3(2)(b), 6, and 7 of the Act of 1988.
5. Legal sustainability of the Anti Evasion authorities' jurisdiction over "persons" versus "dealers."
6. Justification of the Rajasthan Tax Board's acceptance of the appeal without considering Section 84 of the RST Act, 1994.

Issue-wise Detailed Analysis:

1. Jurisdiction of the Assistant Commissioner, Commercial Taxes Department, Anti Evasion Wing:
The Rajasthan Tax Board concluded that the Assistant Commissioner, Commercial Taxes Department, Anti Evasion Wing, lacked jurisdiction to levy tax under the Rajasthan Tax on Entry of Motor Vehicles Into Local Area Act, 1988. Consequently, the assessment orders were quashed. The court upheld that the Anti Evasion Wing had no jurisdiction but emphasized that the assessment order should not have been entirely quashed. Instead, it should have been remanded to the appropriate Commercial Tax Officer (CTO) with jurisdiction.

2. Legality of the Rajasthan Tax Board's decision to set aside the appellate authority's order:
The appellate authority had remanded the matter to the appropriate CTO, but the Tax Board set aside this decision, leading to the quashing of the assessment orders. The court found the Tax Board's decision unjust and improper, stating that the assessment should have been remanded to the correct jurisdictional officer rather than quashing it entirely.

3. Applicability of Section 3(2)(b) of the Act of 1988 to non-dealers:
Section 3(2)(b) of the Act applies mutatis mutandis to non-dealers in the same manner as to dealers. The court clarified that the provisions of the Rajasthan Sales Tax Act, 1954, are applicable to the assessment, reassessment, collection, and enforcement of tax under the Act of 1988.

4. Jurisdiction of Anti Evasion Officers under Sections 3(2)(b), 6, and 7 of the Act of 1988:
The court analyzed Sections 3(2)(b), 6, and 7 of the Act, which empower the authorities to assess, reassess, collect, and enforce payment of tax, including penalties and interest. It concluded that the Anti Evasion Wing lacked jurisdiction, but the CTO of the area where the importer resides or conducts business has the authority to assess the tax.

5. Legal sustainability of the Anti Evasion authorities' jurisdiction over "persons" versus "dealers":
The court examined the notification No.3(a)(9)Jurs/Tax/CCT/97-1 dated 1.4.1997, which restricted the Anti Evasion authorities' jurisdiction to "dealers" and not "persons." The court upheld that the Anti Evasion Wing had no jurisdiction over individuals importing vehicles for personal use, reiterating that the appropriate CTO should handle such assessments.

6. Justification of the Rajasthan Tax Board's acceptance of the appeal without considering Section 84 of the RST Act, 1994:
The court found that the Tax Board failed to consider the provisions of Section 84 of the RST Act, 1994, and the judgment in Ashapura Oil Centre v. State of Rajasthan. It emphasized that the Tax Board should have referred to the Division Bench's judgment and the provisions of the Act, which mandate the application of Rajasthan Sales Tax Act provisions to the assessment under the Act of 1988.

Conclusion:
The court quashed the Tax Board's order and upheld the Dy. Commissioner (Appeals) decision to remand the assessment to the appropriate CTO. The CTO with jurisdiction was directed to assess the assessees expeditiously within six months. The Commissioner, Commercial Taxes Department, Rajasthan, Jaipur, was instructed to transfer all relevant cases to the appropriate assessing officers to avoid further delays. The petitions were allowed, and no costs were imposed.

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