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TMI Blog1988 (11) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... r, believed the credit receipts and the statement of Manoranjan Dogra to the effect that the purchases were on credit and held that apart from credit sales, the dealer had also effected cash sales on 18th May, 1987, but the credit sales had been suppressed. Accordingly, he disbelieved the accounts and proceeded with the assessment to the best of his judgment by taking into consideration the credit sales suppression to the extent of Rs. 3,151.20 on 18th May, 1987 and enhanced the returned gross turnover by a sum of Rs. 12,00,000 thereby making a total tax demand of Rs. 83,452. The dealer averred that the assessment was vitiated by arbitrariness and nonapplication of mind, because the assessing officer was not solely guided by the fraud report in making the best judgment of assessment. He was influenced by a pre-assessment scrutiny report of the Assistant Commissioner of Sales Tax, Bolangir Range, who gave a direction to enhance the gross turnover of the dealer by Rs. 12,00,000 in view of the suppression of the credit sales to Manoranjan Dogra. The assessing officer did not exercise his independent judgment and having accepted the instruction of the Assistant Commissioner blindly mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontained therein. One of them is to inspect the records and to superintend the work of officers subordinate to him and their offices. The learned counsel appearing for both parties did not dispute the proposition at the time of hearing that in exercise of the above powers and in order to facilitate the discharge of functions, the Commissioner is competent to issue circulars for guidance of the Assistant Commissioners as well as the Sales Tax Officers. In exercise of such powers the Commissioner of Sales Tax issued a confidential circular on 14th May, 1987 for scrutiny of assessment records and orders the relevant part of which occurring in para 2 thereof was that the Assistant Commissioner should provide useful guidance to the officers to pass assessment orders. If the Range Assistant Commissioner has provided the guidance and the order of assessment of the Sales Tax Officer is appealed against, such appeal shall be heard by one of the Additional Commissioners of the Range concerned. This function of the Range Assistant Commissioners is called pre-assessment scrutiny. It is almost at par with the inspection of pending records by the District and Sessions judges and the Chief ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulate our opinion, we have to analyse a few decisions. 6.. In [1958] 9 STC 428 (SC); AIR 1958 SC 667 (Mahadayal Premchandra v. Commercial Tax Officer, Calcutta), though the Commercial Tax Officer was satisfied on the materials placed by the assessees and their representative that they were not liable to pay sales tax in respect of some transactions, he referred the matter first for instructions and then for obtaining the "valued opinion" of his superior, the Assistant Commissioner and the latter expressed his opinion that the assessees were liable in respect of these transactions. The Commercial Tax Officer made the reference behind the back of the assessees, who had no opportunity to meet the point of view adopted by the Assistant Commissioner. Following the instructions and the advice of the Assistant Commissioner, the Commercial Tax Officer assessed the assessees to sales tax. On these facts in short, it was held by the Supreme Court as follows: "We are really surprised at the manner in which the first respondent dealt with the matter of this assessment. It is clear that he did not exercise his own judgment in the matter and faithfully followed the instructions conveyed to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner to entertain belief with regard to the assessment for the year 1987-88 that the Assistant Commissioner had imposed his views for enhancement of the gross turnover by Rs. 12,00,000. May be, the Sales Tax Officer was really not influenced by the aforesaid preassessment scrutiny report and it was a mere coincidence that after rejection of the books of accounts of the dealer on account of the fraud report, the Assistant Commissioner, as well as the Sales Tax Officer thought likewise with regard to the quantum of enhancement. But a dealer in such a situation will normally suspect that in a quasi-judicial proceeding justice was not done to him, because of the supposed interference of the appellate authority in the assessment proceeding itself. As pointed out by the Supreme Court, the procedure adopted by the Assistant Commissioner in suggesting enhancement of the gross turnover by a specific amount on account of suppression of sales was not fair and there was scope for criticism that his action undermined the confidence of the dealer in the impartial and fair treatment of the assessment proceeding. It is important for the officers of the Sales Tax Department to note that even thoug ..... X X X X Extracts X X X X X X X X Extracts X X X X
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