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TMI Blog1978 (2) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... . 9,07,174.80 and Rs. 3,84,648.24 respectively for the assessment year 1969-70 in the A-1 return filed by it. The Commercial Tax Officer determined the net taxable turnover at Rs. 2,78,008.29. The disputed turnover of Rs. 1,10,875.57, which represented the purchase value of the groundnut kernel sold to oil-millers in the State, was exempted from tax having regard to the judgment of this court in Madar Khan Co. v. Assistant Commissioner[1971] 27 S.T.C. 18. The Deputy Commissioner, in exercise of his revisional powers under section 20(2) of the Andhra Pradesh General Sales Tax Act, hereinafter referred to as "the Act", after following the procedure prescribed, brought this turnover to tax on the basis of a subsequent decision of the Supreme Court in Sri Venkateswara etc. Oil Mill v. State of Andhra Pradesh[1971] 28 S.T.C. 599 (S.C.). The Supreme Court did not endorse the view of this court in Madar Khan Co. v. Assistant Commissioner[1971] 27 S.T.C. 18., but affirmed the earlier decision of this court in State of Andhra Pradesh v. Lakshmi Oil Mills[1967] 20 S.T.C. 489. The Deputy Commissioner disallowed the exemption granted by the Commercial Tax Officer in respect of the dispute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions 14 and 20. To the extent material, they are in these terms: "Section 14. (4) In any of the following events, namely, where the whole or any part of the turnover of business of a dealer has escaped assessment to tax, or has been under-assessed or assessed at a rate lower than the correct rate, or where the licence fee or registration fee has escaped levy or has been levied at a rate lower than the correct rate, the assessing authority may, after making such inquiry as he considers necessary, assess the correct amount of tax payable or levy the correct amount of licence fee or registration fee........ (b) within a period of four years from the expiry of the year aforesaid, if any such event has occurred due to any other causes........... (4-C) The powers conferred by sub-section (4) on the assessing authority may, subject to the same conditions as are applicable in the case of that authority, be exercised also by any of the authorities higher than the assessing authority including the Deputy Commissioner concerned. Section 20. Revision by Board of Revenue and other prescribed authorities.-(1) The Board of Revenue may suo motu call for and examine the record of any order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th October, 1974, within the period of limitation prescribed in sub-section (3) of section 20. If we are to find that the Deputy Commissioner, in exercise of the power conferred upon him under section 14(4), could have only acted as an assessing authority, the impugned order would be beyond the period of limitation prescribed in section 14(4-A). Mr. Dasaratharama Reddi invited our attention to the decision of a Division Bench of this Court consisting of Madhava Reddy and Ramachandra Raju, JJ., in Sri Balaganesh Textiles v. Commercial Tax Officer, Tirupathi[1978] 41 S.T.C. 445. (C.R.P. Nos. 209 and 238 of 1977), filed under article 227 of the Constitution of India, to contend that the Deputy Commissioner was in error in exercising the revisional jurisdiction instead of reopening the assessment under section 14(4). That was a case where the assessees filed returns showing the turnover and claimed exemption in respect of a portion of the turnover. The Commercial Tax Officer allowed exemption under various heads totalling Rs. 11,10,594.17 and assessed the assessee on a net turnover of Rs. 5,680.42. The exemptions allowed also included a turnover of Rs. 4,27,564 being the sales of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing authority to make a reassessment if the circumstances referred to in the provision exist and that he can make a reassessment where the whole or any part of the turnover escapes assessment to tax or if he fails to assess it correctly and makes under-assessment or assesses the turnover at a lower rate and not at the rate prescribed. In that case, the reassessment was made as the correct rate was not applied to the turnover. Therefore, it was held that the assessing authority was competent to do so. That was a clear case of reopening of an assessment as there was an under-assessment in the sense that the correct rate was not applied. In the case before us, we are not concerned with the correct rate of tax, but we are only concerned with the question whether the Deputy Commissioner had jurisdiction to exercise revisional jurisdiction under section 20(4). The learned counsel sought to place reliance upon another decision of this court in Additional Commissioner of Income-tax v. M.J. Devda[1977] 109 I.T.R. 484. That was a case where an application was filed in this court under section 256(2) of the Income-tax Act to direct the Tribunal to refer the question of law to the High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se to exercise his revisional power, it was found that the correct law that is applicable was the one laid down by the Supreme Court, then it would be open to him to issue a notice to the assessee and, after affording him a reasonable opportunity of being heard, revise the assessment in accordance with the law as laid down by the Supreme Court. Now, let us see what this court said in Madar Khan's case[1971] 27 S.T.C. 18. In that case, a Division Bench of this Court consisting of Chinnappa Reddy and Madhava Reddy, JJ., held that the word "miller" in the entry can only mean the person who crushes groundnuts into oil by the employment of machinery and does not include a person who merely decorticates groundnuts, and if such a "miller" also functions as a "dealer" he will be liable to tax only if the purchase can be brought within the second limb of entry 3, that is, if it is the last purchase within the State. The learned judges expressed their disagreement with the view expressed by another Division Bench of this Court in State of Andhra Pradesh v. Lakshmi Oil Mills[1967] 20 S.T.C. 489. and also Radhakrishna and Co. v. State of Andhra Pradesh[1969] 24 S.T.C. 320. The Supreme Court, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e prescribed. It was held by the court that, on the facts of the case, the reassessment was made as the correct rate was not applied to the turnover and the assessing authority was competent to reassess under section 14(4). The decision of the Supreme Court in Deputy Commissioner v. Dhanalakshmi Vilas Cashew Co.[1969] 24 S.T.C. 491 (S.C.)., puts the question beyond the pale of any controversy. There, the question arose whether the Deputy Commissioner was correct in exercising revisional jurisdiction under section 15(1)(i) of the Kerala General Sales Tax Act. There, the learned judges clearly pointed out the distinction between the revisional jurisdiction and the jurisdiction to tax the escaped turnover. The revisional jurisdiction under section 15(1)(i), as stated by the learned judges, is quite distinct and separate from the one created under rule 33 to tax escaped turnover. The Deputy Commissioner, while exercising revisional jurisdiction under section 15(1)(i), would be restricted to the examination of the record for determining whether the order of assessment was according to law. Rule 33, which confers powers to assess escaped turnover, is normally to be exercised in matters d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be the position in law where a miller purchases some groundnut for milling and the rest for sale." It, therefore, follows that the learned judges of the Supreme Court did not decide the question as to what would be the position in law where a miller purchases a part of the turnover of groundnut for milling and the rest for sale. The burden is upon the assessees to show that they purchased a part of the turnover for milling and the rest for sale. The Tribunal has not chosen to give any finding on this question, that is to say, how much of the turnover was intended for milling and how much was intended for sale. We are, therefore, constrained to remit back the case to the Tribunal to decide the question as to how much of the turnover in each case was purchased by the assessee for milling and the rest for sale. If the Tribunal finds that any part of the turnover was purchased by each of the assessees here with the intention of resale, to that extent the Tribunal will give them relief. The three revisions are accordingly remitted back to the Tribunal for disposal afresh in the light of our decision. No costs. Advocate's fee Rs. 200 in each. Cases remitted. - - TaxTMI - TM ..... X X X X Extracts X X X X X X X X Extracts X X X X
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