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TMI Blog1993 (8) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... to produce his books of accounts. Thereafter, the Sales Tax Officer passed exhibit P3 assessment order dated May 16, 1972. The appeal filed before the Appellate Assistant Commissioner was dismissed by exhibit P4 order dated November 29, 1972. The assessee filed a second appeal before the Sales Tax Appellate Tribunal and the Tribunal by exhibit P5 order again remanded the matter to the Sales Tax Officer with certain directions. In the meanwhile, the assessee died and notices were issued to his legal heirs including the petitioner. Thereafter, by exhibit P6 order dated July 28, 1978, the Sales Tax Officer passed the assessment order fixing the taxable turnover at Rs. 4,96,000. The sales tax due thereon was assessed as Rs. 27,190 with surcharge of Rs. 679.75. His appeal against exhibit P6 order was dismissed by exhibit P7 order. The second appeal filed before the Tribunal was also dismissed by exhibit P8 order dated February 11, 1985. Thereafter the petitioner filed T.R.C. No. 177 of 1985 before this Court which was also dismissed on January 22, 1986. Thus. the assessment under exhibit P6 fixing the tax liability at Rs. 27,190 and surcharge of Rs. 679.75 became final. Thereafter the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal shall not affect the previous operation of the said Act or any right, title, obligation or liability already acquired, accrued or incurred thereunder and subject thereto, anything done or any action taken, including any appointment, notification, notice, order, rule, form, regulation, certificate, licence or permit, in the exercise of any power conferred by or under the said Act, shall be deemed to have been done or taken in the exercise of the powers conferred by or under this Act, as if this Act were in force on the date on which such thing was done or action was taken, and all arrears of tax and other amounts due at the commencement of this Act may be recovered as if they had accrued under this Act. (2) Notwithstanding anything contained in sub-section (1), any application, appeal, revision or other proceeding made or preferred to any officer or authority under the said Act, and pending at the commencement of this Act, shall, after such commencement, be transferred to and disposed of by the officer or authority who would have had jurisdiction to entertain such application, appeal, revision or other proceeding under this Act if it had been in force on the date on which suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the repealing provision. The right to be assessed under the 1125 Act during the period when that Act was in force is thus saved by the first part of the proviso. In that view of the matter, though the final assessment order was passed only by exhibit P6 dated July 28, 1978, it was an assessment in accordance with the rights and liabilities of the petitioner under the repealed Act. The right, or to be precise, the immunity from paying penal interest on arrears of sales tax itself, is a right which had accrued to the assessee for the period when the repealed Act was in force which is saved by the first part of the proviso. 5.. The second part of the proviso provides that subject thereto, anything done or any action taken including any appointment, notification, notice, order, rule, etc., in exercise of the power under the repealed Act shall be deemed to have been done or taken in the exercise of the powers conferred under the 1963 Act. This provision only relates to the procedure to be adopted in passing an assessment order or any other orders on matters which are pending consideration when the 1963 Act came into force and to facilitate recovery of arrears of tax under the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a notice under section 19(1) of the new Act. The assessee raised a preliminary objection that his assessment having been made under the repealed Act, under which the limitation of a period of three years was prescribed by section 11A for assessment of escaped turnover, the assessment could not be reopened. The Sales Tax Officer, relying on section 19(1) of the new Act which prescribed a period of five calendar years for reopening an assessment, rejected the objection of the assessee. In considering that question their Lordships of the Supreme Court considered section 52 of the Madhya Pradesh General Sales Tax Act which is similar to that of section 61 of the KGST Act, 1963. Construing that section their Lordships observed as follows: "It was under section 52 of the new Act that the repealed Act was repealed, and that section itself, under the proviso laid down that such repeal shall not affect the previous operation of the said Act or any right, title, obligation or liability already acquired, accrued or incurred thereunder. There was also the further addition that subject thereto, anything done or any action taken (including any appointment, notification, notice, order, rule, fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Sales Tax v. Amarnath Ajitkumar of Bhind) their Lordships, came to the conclusion that the provisions of the repealed Act are applicable to assessments in regard to the period when the repealed Act was in operation basing on the interpretation of the first part of the proviso. In [1971] 28 STC 702 (SC) (Commissioner of Sales Tax v. Amarnath Ajitkumar of Bhind) the additional words contained in the proviso to section 52 mentioned above were also relied on as an additional ground for taking the view that the provisions of the repealed Act will apply for the assessment years when that Act was in force. The absence of the above words in the proviso to section 61 of the KGST Act, 1963, will not make any difference as we have already held that that part deals only with the procedural aspects and does not affect the substantive rights or liabilities accrued or incurred under the repealed Act. Thus, we are clearly of the opinion that the absence of the above words in the proviso to section 61 will not make any difference and that the rights and liabilities have to be determined solely in accordance with the provisions of the 1125 Act. 9.. Counsel for the Revenue relied on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gly the third part of the proviso is applicable. This Court did not rely on the first or second part of the proviso to come to the conclusion that section 21 of the KGST Act, 1963, is applicable. In that view of the matter, that decision cannot have any application to the facts of this case. 10.. In view of what is stated above, we hold that section 23(3) of the KGST Act, 1963, cannot have any application for any arrears of tax due for the period when the General Sales Tax Act, 1125, was in force. The provisions of section 61 of the KGST Act, 1963, preserve the rights and liabilities accrued or incurred under the 1125 Act and the new liability created under section 23(3) of the 1963 Act cannot have any application for the arrears of sales tax due for the period when the 1125 Act was in force. 11.. As we have held that section 23(3) of the 1963 Act cannot have any application for the assessment year in question, it is not necessary for us to consider the other grounds raised by the petitioner in this original petition and they are left open. 12.. In the result, we allow this original petition and quash exhibit P9 notice to the extent of the demand of Rs. 27,849.80 towards pena ..... X X X X Extracts X X X X X X X X Extracts X X X X
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