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TMI Blog1960 (8) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... r-State trade or commerce were not liable to be taxed. Thereafter, the successor of the Sales Tax Officer who made the assessment order on 26th July, 1955, sought the sanction of the Commissioner of Sales Tax sometime in April, 1956, for a review of the assessment order dated 26th July, 1955. On 19th June, 1956, the Deputy Commissioner of Sales Tax addressed a letter to the Sales Tax Officer communicating the refusal of the sanction and at the same time suggesting that the assessment could be reopened under section 11-A of the Act. He also added in the letter that the assessment of sales tax on the appellant for the year from 1st April, 1952 to 31st March, 1953, was under revision by the Commissioner under section 22-B. Pursuant to this suggestion the Sales Tax Officer issued a notice to the assessee under section 11-A. The notice called upon the appellant to show cause why he should not be re-assessed. It stated that the Sales Tax Officer was satisfied that the appellant's turnover during the period from 1st April, 1953, to 31st March, 1954, had been under-assessed and that the deduction had been wrongly made from the turnover. The appellant then filed a petition under Article 226 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Sales Tax Officer had jurisdiction to take proceedings under section 11-A only if he was satisfied as to the matters mentioned in section 11-A in consequence of any information received by him after the assessment sought to be reopened. Learned counsel proceeded to say that as the information on which the Sales Tax Officer issued the notice under section 11-A was not disclosed, it must be taken that he was not in possession of the information contemplated by section 11-A and that therefore in the absence of any such information he had no jurisdiction to issue the notice that he did. 5.. In our judgment, the contention put forward by Shri Bobde on behalf of the assessee must be accepted. Section 11-A(1) is as follows: "If in consequence of any information which has come into his possession, the Commissioner is satisfied that any turnover of a dealer during any period has been under-assessed or has escaped assessment or assessed at a lower rate or any deduction has been wrongly made therefrom, the Commissioner may, at any time within three calendar years from the expiry of such period, after giving the dealer a reasonable opportunity of being heard and after making such enquiry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f mere change of opinion on the same state of facts and not a case of finding as a result of new information that the dealer has escaped assessment in some respect. The satisfaction of the taxing authority in the matter of any turnover escaping assessment must be thus on information received by him subsequent to the assessment. No doubt under section 11-A it is the satisfaction of the Commissioner or the Sales Tax Officer which is necessary for action under that provision. The question of satisfaction being a subjective matter cannot be challenged in a court of law except on the ground of mala fides. But there must be causative and rational connection between the information and the satisfaction. Now the matter of the receipt of information subsequent to the assessment, its nature and its connection with the satisfaction cannot be said to be subjective matters. They are all objective, which have to be and can be determined in a court of law whenever it is questioned that the taxing authority did not come into possession of any information contemplated by section 11-A. We do not find ourselves in agreement with the view of the learned single Judge that the assessee is not entitled t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere the Income-tax Officer has in consequence of information in his possession "reason to believe" that income has escaped assessment or full assessment. Even with regard to the expression "in consequence of any information in his possession" the Supreme Court has in Maharaj Kumar v. Income-tax Commissioner[1959] 35 I.T.R. 1; A.I.R. 1959 3.C. 257., held that this means that the relevant information must have come into the possession of the Income-tax Officer subsequent to the making of the assessment order in question and this information must lead to his belief that income chargeable to income-tax has escaped assessment or full assessment. Section 11-A of the Sales Tax Act is much more explicit, and says "in consequence of any information which has come into his possession" and, therefore, the construction put by the Supreme Court on "in consequence of information in his possession" must apply with greater force to the present case. In Maharaj Kumar's case(1), the Supreme Court construed "information" for the purpose of section 34(1)(b), Income-tax Act, as not limited to factual information but including information as to the true and correct state of the law and thus covering inf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment made on 20th July, 1955. But the inability of the opponents to disclose the date of the receipt of the information and its nature cannot but be taken in the present case as indicative of the total absence of information contemplated by section 11-A. The essential prerequisite as to information was thus not fulfilled here. Therefore, the Sales Tax Officer had no jurisdiction to take proceedings under section 11-A and the notice issued by him to the appellant was altogether untenable. 9.. It must be emphasized that, here, there is total absence of any information giving jurisdiction to the competent taxing authority to proceed under section 11-A. It is not as if there was some relevant information on which the taxing authority satisfied itself as to the turnover of the appellant escaping assessment or full assessment and the decision of the authority upon the existence of a state of things being questioned on the argument that the authority could not give itself jurisdiction by a wrong decision on facts. If that had been the situation, the case would have fallen within the category of cases referred by Lord Esher in The Queen v. Commissioner for Special Purposes of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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