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TMI Blog1980 (12) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... s liable to tax at 3 per cent. This contention as well was accepted by the Sales Tax Officer and in this way total tax liability of Rs. 6,390.78 was raised. Subsequently, it was found by the Sales Tax Officer that proper rate of tax had not been applied on the disclosed turnover and exemption too had been wrongly allowed in respect of the turnover of construction work. Accordingly action was taken under section 21 of the Act and a notice was issued to the assessee. The assessee contested the notice on the grounds that action was not justified since no fresh material had been brought on record and merely as a result of change of opinion such action could not be taken. This objection was repelled by the Sales Tax Officer and he levied tax on the turnover in respect of construction work at 4 per cent. on sales of M.S. tubes at 6.5 per cent and on sales of tabular sheds at 4 per cent. This resulted in an additional liability of Rs. 5,411.52 and to that was added a sum of Rs. 937.30 by way of interest. The assessee's appeal having failed he took up the matter in revision before the Additional Judge (Revisions), Saharanpur, and challenged the validity of initiation of proceedings under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to these two items there was a clear error of law committed by the Sales Tax Officer in the original assessment order and, that being so, it would be a case of under-assessment for which action could be taken under section 21 of the Act. It was further contended that M.S. tubes and tabular sheds will not be covered by section 14(iv) of the Central Act. According to the learned standing counsel it was not a case of change of opinion but it was a case of nonapplication of mind on the part of the Sales Tax Officer at the time of the making of the original assessment. On the other hand, from the side of the assessee it was submitted by Sri Bharatji Agarwal that these two items will be covered by section 14(iv) of the Central Act and apart from that if a wrong view had been taken by the Sales Tax Officer while making the original assessment, the remedy of the Commissioner was to file an appeal against that order. Section 21 could not be invoked for correcting such an error and thus, it was a clear case of change of opinion. It was also stated that in order to find out the nature of the disputed items one cannot proceed merely on assumptions and the question can be decided only after co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l on which the Sales Tax Officer could reasonably believe that the turnover of the assessee had escaped assessment. The view taken in Anandji Haridas and Co. (P.) Ltd. v. S.P. Kushare[1968] 21 S.T.C. 326 at 334 (S.C.). was followed. At page 334 it was observed by the Supreme Court: "In Maharaj Kumar Kamal Singh v. Commissioner of Income-tax, Bihar and Orissa[1959] 35 I.T.R. 1 (S.C.); [1959] Supp. 1 S.C.R. 10., this court laid down that the expression 'has escaped assessment' in section 34(1)(b) of the Indian Income-tax Act, 1922, is applicable not only where the income has not been assessed owing to inadvertence or oversight or owing to the fact that no return has been submitted, but also where a return has been submitted but the Income-tax Officer erroneously failed to tax a part of the assessable income. " Thus, oversight or inadvertence or failure on the part of the Income-tax Officer to tax a part of the assessable income was considered as sufficient for action under section 34(1)(b) and there is no reason for not extending this principle to an action under section 21 of the Act. It is of course correct that if action has been taken under section 21 merely on change of opin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v) Iron and steel, that is to say,- (a) pig iron and iron scrap; (b) iron plates sold in the same form in which they are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods; (d) (i) steel plates, (ii) steel sheets, sold in the same form in which they (iii) sheet bars and tin bars, are directly produced by the rolling (iv) rolled steel sections, mill." (v) tool alloy steel By the Central Sales Tax (Amendment) Act, 1972 (61 of 1972), with effect from 1st April, 1973, this clause has been redrafted and now iron and steel is divided into 16 categories which embrace widely different commercial commodities. Some of the enumerated items can serve as raw materials out of which other goods are made and others are definitely varieties of manufactured goods. So far as the present case is concerned, clause (iv) as it stood before the aforesaid amendment would apply and not the amended one. The question which arises in this connection is as to whether this clause was meant to enumerate separately taxable goods or just to illustrate what is one taxable substance "iron and steel". This question came up before the Supreme Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Sales Tax v. Bombay Machinery Co., Allahabad[1980] 46 S.T.C. 291; 1980 U.P.T.C. 724. An almost similar question had come up for consideration before me in Commissioner of Sales Tax v. Chand Stores[1981] 48 S.T.C. 417; 1980 A.T.J. 74. In that case for the assessment year 1969-70, the turnover of pullovers, cardigans, etc., was taxed at 3 per cent. Subsequently, it was found that the turnover of those goods was taxable at 6 per cent and hence proceedings were taken under section 21 of the Act. In Ram Lal Brothers v. Commissioner of Sales Tax1979 A.T.J. 41. , it had been held by this Court that woollen cardigans and woollen pullovers are woollen goods and not woollen hosiery liable to be taxed at 6 per cent and not at 3 per cent. Following that decision the action of the Sales Tax Officer in Chand Stores[1981] 48 S.T.C. 417; 1980 A.T.J. 74. was upheld. I am inclined to take the same view in the present case because when M.S. tubes and tabular sheds are not covered by section 14(iv) of the Central Act, they could not be treated as declared goods liable to tax at 3 per cent. The sales thereof were taxable at a higher rate and certainly it was a case where there had been esc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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