9911796707
TMI Blog1993 (6) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... assessing authority to pass a proper order calculating the tax payable and to issue a revised demand notice. This order is dated July 3, 1986. The appellant went up in appeal against this order before the Appellate Tribunal and the said appeal is still pending. In the meanwhile the Joint Commissioner initiated proceedings under section 22A of the Act proposing to revise the order of the Deputy Commissioner aforesaid as well as the order of the assessment. The notice issued opens with the following statement: "Please take notice that the records leading to the assessment order dated August 31, 1984 passed by the Assistant Commissioner of Commercial Taxes, (Assessments), Mangalore, for the year 1981-82 and the SMR Order No. SMR 107/85-86 dated July 3, 1986 passed by the Deputy Commissioner of Commercial Taxes (Admn.), Mangalore, in your case have been examined by me and it is considered that the SMR order and assessment order are erroneous and prejudicial to the interest of revenue for the following reasons:" According to the Joint Commissioner the rate of tax should have been 6 per cent and not 5 per cent on the purchase turnover of the raw cashewnuts. Similarly the rate of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stands merged and therefore for the purpose of limitation the relevant date will be the date of the rectification order. In the instant case the Appellate Tribunal has not made any order. The appeal of the appellant is still pending consideration before the Appellate Tribunal. The Joint Commissioner has proposed to revise the order made by the Deputy Commissioner read with the order of the assessment. Under section 22A of the Act the Joint Commissioner is competent to call for and examine the record of any proceeding under the Act; and if the Joint Commissioner considers that any order passed therein by any officer who is not above the rank of a Deputy Commissioner is erroneous in so far as it is prejudicial to the interest of the Revenue, he may pass an order under the said provision. In the instant case the order sought to be revised is of the Deputy Commissioner read with the original order of assessment. The order made by the Deputy Commissioner is an order made in a proceeding under section 21 of the Act. In these circumstances there can be no doubt that the Joint Commissioner had jurisdiction to invoke section 22A. According to Mr. Indrakumar the Deputy Commissioner sought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion while making an order would render the said order erroneous, and if so, certainly section 22A will be attracted provided it is prejudicial to the interest of the Revenue. Mr. Indrakumar relied on the decision of this Court reported in H.V. Subraya Setty Sons v. State of Karnataka [1991] 35 Kar LJ (Tri. Supp.) 44. According to the learned counsel, in the said decision it was held that the revisional jurisdiction under section 22A should be confined to the correctness of any error committed by the appellate authority and no more. This observation is found in para 8 of the aforesaid decision. In the said case the assessing authority proposed to enhance the turnover returned on best judgment basis. The appellate authority found fault with the assessing authority on this aspect on the assumption that there was misclassification of goods and hence allowed the appeal. The Commissioner invoked his revisional jurisdiction on the ground that the order of the appellate authority was prejudicial to the interest of the Revenue. The Bench observed that this invocation of the jurisdiction was perfectly in order but found fault with the reasoning adopted by the Commissioner. The Bench also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sale price. (ii) The dealer who purchased the goods consumes such goods in the manufacture of other goods for sale, etc. Both these events should occur before section 6 is attracted. The second event is the event which fixes the time for levying the tax. On the said date rate of tax has been reduced by the State Legislature to 5 per cent and therefore the revisional authority committed an error in directing the levy at 6 per cent was the argument. Under section 6 purchase tax is payable on the purchase price of the goods at the same rate at which it would have been leviable on the sale price of such goods under section 5. The opening sentence also refers to the phrase "on the sale price of such goods". In other words, if the sales tax is not leviable at the time of the first sale in the State, purchase tax is levied in the hands of the purchaser and that tax is at the rate which would have been leviable on the sale price of such goods. Section 6 is therefore quite clear that the rate of tax is the rate applicable to the sale price; in other words the relevant point of time to identify the rate of tax will be the time of the sale. The contention of the appellant involves, by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supports the contention of the learned counsel before us. In fact at page 201 the basic idea of the purchase tax was stated thus: "......It creates a liability against a dealer on his purchase turnover with regard to goods, the sale or purchase of which though generally liable to tax under the Act have not, due to the circumstances of particular sales, suffered tax under section 3, 4 or 5, and which after the purchase, have been dealt by him in any of the modes indicated in clauses (a), (b) and (c) of section 7-A(1)." The learned counsel fairly brought to our notice another decision of the Supreme Court reported in Deputy Commissioner of Sales Tax (Law), Board of Revenue (Taxes) v. Padinjarakara Agencies [1985] 60 STC 308 which according to us directly answers the question against the contention of the appellant. The dealer had a stock of goods as on June 30, 1974. The goods had been purchased earlier. At the sale point there was no levy but the rate of tax was 3 per cent. As on June 30, 1974 it was found that the tax was leviable on the purchase turnover of the assessee. On the said date rate of tax was 5 per cent. The Revenue contended that the relevant point of time is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction is quite clear, to treat the class of goods only in the particular manner stated in the entry; it is not possible to infer an implied intention on the part of the Legislature to treat the goods in any other manner, contrary to the express intention in the amending Act; necessarily, the earlier notification would cease to be effective automatically. If the Legislature enacts on a particular date that specified goods shall be taxed in a particular manner, it is clear that at least on the said date, the Legislature had a clear intention to levy the tax on the goods in question at that particular rate. The Legislature is presumed to be aware of the prevailing circumstances relevant to the subject-matter in question as it existed when the law was enacted. Therefore, when entry 48A was amended retrospectively with the insertion of sub-entry (ii), it is clear that the Legislature intended that the tax under section 5 will have to be levied in terms of said entry 48A, with retrospective effect from 1st July, 1974. While inserting sub-entry (ii) by Act No. 23 of 1983 the Legislature has not found it necessary to save the operation of the notification issued by the State Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Wallace case [1993] 91 STC 37; ILR [1992] Kar 1494 at para 7 (page 42 of STC) to the effect that,".......if the Legislature enacts on a particular date that specified goods shall be taxed in a particular manner, it is clear that at least on the said date, the Legislature had a clear intention to levy the tax on the goods in question at that particular rate." Again at para 15 (page 45 of STC) the Full Bench answered the question referred to it, which reads thus: "Therefore, we answer the question referred to us in the affirmative; we are of the opinion that a notification issued under section 8-A of the Act will be impliedly repealed or rendered ineffective when the Legislature amends the Act and introduces an entry in the Schedule to the Act which relates to the class of goods to which exemption is given by the notification." In view of the above clear enunciation of the principle stated by the Full Bench it is not possible for us to take a different view. It is unnecessary for us to analyse the purpose behind sub-section (3-A) and what follows by it by necessary implication. Mr. Indrakumar then pointed out that the appellant before this Court and only a limited number of ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
