2017 (12) TMI 885 - HC - VAT and Sales Tax

Rectification of assessment order - whether the subject issue is an error, which could be rectified by the assessing officer invoking Section 55 of the TNGST Act and as to how the taxable turnover has to be computed? - Held that - it cannot be stated that the power under Section 55 of the TNGST Act can be exercised only for the purpose of rectifying clerical mistakes or typographical mistakes. In the instant case, the mistake sought to be rectified is as to how the taxable turnover has to be computed. This undoubtedly is well within the jurisdiction of the power exercisable by the assessing officer under Section 55 of the TNGST Act. Thus, the respondent was justified in examining his power under Section 55 of the TNGST Act. Computation of taxable turnover - Held that - the respondent has rightly held that the turnover has to be fixed for the whole of the year and the year means the financial year as defined under Section 2(t) of the TNGST Act. Petition dismissed - decided against petitioner.

Summary

Issues:
Challenge to order passed under Section 55 of TNGST Act for rectifying assessment order for assessment year 2005-06. Calculation of taxable turnover and additional sales tax rate.

Analysis:
1. The petitioner challenged an order under Section 55 of the TNGST Act rectifying the assessment order for the assessment year 2005-06. The respondent rectified the tax rates based on the taxable turnover reported by the petitioner. The petitioner objected to the additional sales tax calculation, arguing that the total turnover should be considered for the period without additional sales tax. The objections were rejected by the respondent.

2. The two main issues in this case are whether the matter is rectifiable under Section 55 of the TNGST Act and how the taxable turnover should be computed. Section 55 allows rectification of errors apparent on the face of the record, including enhancing assessments or penalties. The assessing officer has the authority to rectify mistakes related to taxable turnover calculation. The respondent was justified in examining the power under Section 55.

3. Regarding the computation of taxable turnover, the respondent correctly determined that the turnover should be calculated for the entire financial year as defined under the TNGST Act. The court referred to a previous judgment stating that the expression 'taxable turnover' in the TNAST Act should be understood in the same sense as in the TNGST Act. Therefore, the respondent's rectification of the error in taxable turnover calculation was deemed appropriate.

4. The court found the impugned order to be just and proper, leading to the dismissal of the writ petition without costs. The judgment highlights the importance of correctly interpreting statutory provisions and applying them in tax assessments to ensure fairness and accuracy in the process.

By analyzing the issues raised in the petition and the court's detailed reasoning, the judgment provides clarity on the application of Section 55 of the TNGST Act and the computation of taxable turnover, setting a precedent for similar cases in the future.