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TMI Blog1966 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. In Writ Petition No. 308 of 1964 which relates to the Gadag area, the petitioner was informed that since he had failed to register himself as a dealer under the Bombay Sales Tax Act although he was liable to pay the tax in respect of the period to which the notice related, it was proposed to make a best judgment assessment of the tax due by the petitioner and to impose a penalty on him under sub-section (7) of section 14 for wilful failure to apply for registration. The notice under section 15 intimated the petitioner that it was proposed to assess his escaped turnover. The period to which both of these notices related was the period between 1st November, 1956, and 30th September, 1957. By these notices, the petitioner was called upon to produce his accounts by the dates specified in these notices. The petitioner thereupon pointed out to the concerned Commercial Tax Officer that the proceedings which were proposed to be commenced had become time barred. The Commercial Tax Officer, however, maintained that he could continue the proceedings and so, the petitioner asks us to quash the notices issued by the Commercial Tax Officer and to stop further proceedings by appropriate writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner has failed to apply for registration and so it was that he proposed to make an assessment to the best of his judgment of the amount of the tax due from the petitioner under subsection (6) of section 14. He simultaneously proposed to impose a penalty for failure to apply for registration which is possible under sub-section (7) of that section. Neither sub-section (6) nor sub-section (7) expressly prescribes any period of limitation within which an assessment could be made under sub-section (6) or a penalty could be imposed under subsection (7). But the argument maintained for the petitioner is that when the Commercial Tax Officer proposed to make an assessment under subsection (6) he proposed to do no more than to make an assessment of the escaped turnover and that no proceeding could be commenced in that regard except within the periods of limitation prescribed by section 15. From the decision of the Supreme Court in Ghanshyamdas v. Regional Assistant Commissioner of Sales Tax, Nagpur[1963] 14 S.T.C. 976., three principles clearly emerge. The first is that the expression "escaped assessment" includes a turnover which has never been assessed either for one reason or for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on (5) authorises a similar best judgment assessment in a case where the dealer furnishes no return by the prescribed date. Sub-section (6) with which we are concerned again creates the power to make a best judgment assessment in the case of a dealer who was liable to pay the tax under the Act but did not apply for registration and so produced no return. Sub-section (7) authorises the imposition of a penalty upon person governed by sub-section (6), and sub-section (8) preserves the power to commence a prosecution under the Act notwithstanding an assessment made under section 14. What becomes manifest from the pronouncement of the Supreme Court in Ghanshyamdas's case[1966] 18 S.T.C. 43; 5 Mys. L.R. 87. is that in all cases where the taxing authority wishes to make a best judgment assessment, either for the reason that the dealer produced no return or for the reason that he produced no further information though called upon to do so, he commenced a proceeding for the assessment of an escaped turnover. That was the view taken by this Court in Rajaram Factory's case(2) in which the taxing authority proposed to make a best judgment assessment under sub-section (5) of section 14 in a cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issue of a notice under section 11 for furnishing a return of business profits and which did not prescribe any period of limitation. The view expressed in that case was that taking the scheme of the Act as a whole, it was the duty of the Court to import into section 11 the period of limitation prescribed by section 14, and, in that context, the Court said this: "In our opinion, every Act must be construed as a whole and the duty of the Court must be as far as possible to reconcile the various provisions of a statute ................................ "Inasmuch as section 11 does not indicate any period of time with regard to the issuing of a notice, would it or would it not be right for us to import into section 11 the consideration which led the Legislature to fix a limitation of time for the purpose of issuing a notice under section 14? If we were not to do that, we would arrive at this rather extraordinary conclusion that the Legislature, while saving the subject from harassment of proceedings with regard to escaped assessment or under-assessment, permitted that harassment with regard to the very initiation of proceedings after the lapse of four years ....................'' We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is the limitation prescribed for an assessment of an escaped turnover is plainly applicable even to an assessment under sub-section (6). Mr. Kulkarni, the learned Government Pleader, urged that an assessment under sub-section (6) is outside the period of limitation prescribed by section 15 since the assessment of an escaped turnover of an unregistered dealer is unlike the preceding sub-section of section 14 which authorises the assessment of the turnover of a registered dealer. This submission is unacceptable. Section 13(1)(b) empowered the Collector to require even an unregistered dealer to produce a return of his turnover, and, while sub-section (1) of section 14 is applicable only to a registered dealer the other sub-sections, namely, subsections (2), (3), (4) and (5) are as much applicable to an unregistered dealer as they are to a registered dealer. While sub-section (1) expressly refers to a registered dealer, the word occurring in subsections (2), (3), (4) and (5) is the word "dealer" without the adjective "registered" preceding it. The interpretation suggested by Mr. Government Pleader that even sub-sections (2) to (5) govern only the assessment of the turnover of a regis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nover is governed. The view that we take receives support from what was said by the Supreme Court in Ghanshyamdas's case[1963] 14 S.T.C. 976., in the context of the pronouncement of the High Court of Bombay in Ramkrishna Ramnath v. Sales Tax Officer, Nagpur, and Others(2), in which the High Court of Bombay felt disposed to take the view that the period of limitation prescribed under section 11-A of the C. P. and Berar Sales Tax Act was inapplicable to a proceeding under section 11(4)(a) of that Act, in which the best judgment assessment was proposed to be made in default of compliance with the requisition of the taxing authority. The Supreme Court which did not accept the enunciation, said this: "A Division Bench of the same High Court in Ramkrishna Ramnath v. Sales Tax Officer, Nagpur[1960] 11 S.T.C. 811., made a distinction between proceedings under section 11(4)(a) and those under section 11(2) of the Act in that proceedings under section 11(2) are for the purpose of assessment whereas those under section 11(4)(a) are taken in terrorem and the dealer is penalized by a best judgment assessment in default of compliance. On that reasoning they held that the period of limitation pr ..... 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