2016 (1) TMI 954 - HC - VAT and Sales Tax

Maintenance of records for 5 years - The five year period to be reckoned from the last day of the financial year concerned or not - Revision proceedings - Rate of tax on zinc oxide - 10% or 4% - In order to set right these mistakes, a revision was proposed. That was to revise the assessment order under section 57 of the BST Act. That is how Notice in Form 40 was issued and served upon the dealer on 7th December, 1998, calling upon him to remain present on 28th December, 1998. However, on that date the dealer did not remain present. That is why the matter was adjourned. On 6th December, 2000, in the absence of the dealer and his representative, the file was closed and the subject order dated 7th December, 2000, came to be passed. Held that - This is not a case where any order to the prejudice of the applicant-dealer has been passed because of non availability or non production of the records. The Second Appellate Order initially passed on 23rd June, 2010, recites the facts. The Revisional Authority passed the order ex-parte on scrutiny of the case records underlying the assessment order dated 30th November, 1995. Thus, the records before the Assessing Authority were taken into consideration. The dealer was called upon on the basis thereof to satisfy the Revisional Authority as to why the assessment order should not be revised. There was absolutely no prejudice, therefore, to the dealer and he could have, on the basis of the order of assessment, opposed the exercise of the Revisional power. - Decided against the assessee.

Summary

Issues:
1. Interpretation of Rule 54 of the Bombay Sales Tax Rules, 1959 regarding the maintenance of records by a dealer.
2. Validity of the revisional exercise undertaken by the Revisional Authority under section 57 of the BST Act.
3. Determination of whether the questions raised by the applicant are questions of law.

Analysis:
1. The petitioner argued that Rule 54 does not mandate dealers to maintain records of past transactions for more than five years, starting from the last day of the financial year concerned. The case involved an assessment order made in 1995 for the period 1992-1993, concerning zinc oxide taxed at 10%. The Revisional Authority proposed a revision due to discrepancies in tax payment, leading to a demand of Rs. 2,94,219. The petitioner contended that the Tribunal failed to address the applicability of Rule 54, which led to the rejection of the Reference Application erroneously.

2. The respondent, representing the Revenue, opposed the petitioner's claims, stating that the revisional power can be exercised lawfully if statutory requirements are met. The Revisional Authority found the dealer unable to justify why the assessment order should not be revised based on available records. It was argued that the dealer had sufficient opportunities to present their case, and the revisional exercise was conducted within the legal framework. The respondent urged for the rejection of the application.

3. The Court considered the arguments presented by both parties and referred to a previous Division Bench judgment regarding the production of documents during assessments. The Court noted that the present case did not involve any prejudice to the dealer due to record availability or production issues. The Second Appellate Order and the Revisional Authority's actions were within legal boundaries, and the exercise of revisional power did not cause any harm to the dealer. The Court concluded that the questions raised by the applicant did not warrant further reference, as the Revisional Authority's actions were found to be justified and lawful.

In the final judgment, the Court dismissed the application, stating that the questions raised did not constitute questions of law. The Court emphasized that the Revisional Authority had appropriately exercised its power, and there was no basis for further intervention. The Court found no merit in the application and consequently rejected it.