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TMI Blog1968 (10) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the turnover for the quarters ending 30th June and 30th September, 1967, made a best judgment assessment on 8th January, 1968, under rule 41(3) of the U.P. Sales Tax Rules in respect of the U.P. sales tax liability and an assessment order of the same date under rule 41(3) of the U.P. Sales Tax Rules in respect of the Central sales tax liability. As regards the quarterly return for the quarter ending 31st December, 1967, he issued a notice to the petitioner dated 16th February, 1968, calling upon it to show cause why an assessment under rule 41(3) of the U.P. Sales Tax Rules should not be made against it. The petitioner has accordingly filed this and the connected petitions challenging the jurisdiction of the Sales Tax Officer to make the assessment orders for the quarters ending 30th June and 30th September, 1967, and to take the assessment proceedings proposed by him for the quarter ending 31st December, 1967. By the instant petition for certiorari the petitioner challenges the assessment order made in regard to the U.P. sales tax liability. Writ Petition No. 530 of 1968 is directed against the assessment order in respect of the Central sales tax liability. Writ Petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovision is to be found in section 23-B of the Indian Income-tax Act, 1922, and section 141 of the Income-tax Act, 1961. It is plain from the language of sub-rules (1), (2) and (3) of rule 41 that the dealer was required merely to deposit the tax admitted by him to be due and when filing the return for each quarter to adduce proof of such payment. If the return was filed and the proof adduced there was no jurisdiction in the Sales Tax Officer to make any assessment of the turnover at that stage. It is only if no return was submitted by the dealer or the return was submitted without payment of the tax that rule 41(3) empowered the Sales Tax Officer to determine the turnover to the best of his judgment and provisionally assess the tax payable for the quarter and require the dealer to pay the tax so assessed. It is not disputed that the petitioner filed the returns for the requisite quarters, and on the basis that no tax was attracted to the turnover in question he did not deposit any amount towards tax. There was no jurisdiction in the Sales Tax Officer to enquire whether the position assumed by the petitioner when filing his returns of turnover that he was not liable to tax in relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Under sub-rule (3) the Sales Tax Officer is required to make a best judgment assessment if no return is submitted or if the return is submitted without the treasury chalan or cheque evidencing the deposit of the tax. Sub-sections (2) and (3) of section 7 do not speak of a provisional assessment at all. They appear to contemplate a final or regular assessment. Sub-section (2) provides that if the assessing authority is satisfied that the returns submitted under sub-section (1) are correct and complete he will assess the tax on the basis thereof. Sub-section (3) declares that if no return is submitted by the dealer within the period prescribed in that behalf or if the return submitted appears to the assessing authority to be incorrect or incomplete the assessing authority shall determine the turnover to the best of his judgment and assess the tax on the basis thereof. The scope of sub-section (3) of section 7 is materially different from that of sub-rule (3) of rule 41. While the jurisdiction to make a best judgment assessment if no return is submitted within the prescribed period is common to both the provisions, there is material difference in regard to the circumstances in which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eme for advance collection of the tax before the final or regular assessment. As I have said, sub-section (3) of section 7 does not speak of a provisional assessment. That it contemplates a final or regular assessment is further reinforced by the consideration that it is part of the scheme expressed in sub-section (2). If the assessing authority is satisfied that the returns submitted by the dealer are correct and complete he assesses the tax on the basis thereof. Sub-section (2) contemplates that the assessing authority, at the end of the assessment year, will take up the returns filed during the year by the dealer and make a final or regular assessment on their basis. If an assessment is not made under sub-section (2) then a best judgment assessment is contemplated under sub-section (3). In line with the nature of the assessment to be made under sub-section (2), the best judgment assessment under sub-section (3) must also be a final or regular assessment. Learned counsel for the respondents urges that the returns filed by the petitioner were incomplete and, therefore, section 7(3) was attracted. The returns were incomplete, he says, because they were not accompanied by any tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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