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TMI Blog2013 (3) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment, provides that permission can be granted even in the case where there is change of opinion. In M/s S.K. Traders, Modi Nagar, Ghaziabad versus Additional Commissioner Grade-I, Trade Tax, Zone Ghaziabad and another,[2007 (7) TMI 573 - ALLAHABAD HIGH COURT] it has been held that the change of opinion may arise even if some material has been brought on record after assessment has been completed or it may be because of result of lack of care or inadvertence on the part of the Assessing Officer. - Decided in favor of revenue. - Writ Tax No.-642 of 2008 - - - Dated:- 6-3-2013 - Prakash Krishna And Ram Surat Ram (Maurya),JJ. Petitioner Counsel :- Kunwar Saksena , Sudeep Dwivedi Respondent Counsel :- C.S.C. Connected with JUDGMENT By means of this writ petition, the petitioner has challenged the authorization order dated 22.2.2008/25.2.2008 passed by the Additional Commissioner, Grade-I, Commissioner Tax, Allahabad Zone, Allahabad granting permission under section 21(2) of U.P Trade Act Act for reassessment for the assessment year 2001-2002 (Central). The petitioner, a partnership firm is carrying on business of procuring rice from paddy pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opinion, which is not permissible under law. Elaborating the argument, it was submitted that the Commissioner of Trade Tax has exceeded in its jurisdiction in issuing circular dated 25.3.2007 and on that basis, the Assessing Authority has formed an opinion that the turnover of the petitioner has escaped assessment. It was also submitted that the Commissioner of Trade Tax has exceeded in its jurisdiction in issuing the circular like the present one which interferes with the quasi judicial power of the assessing authority. Reliance was placed upon a decision of Division Bench of this Court in the case of M/s Aryaverth Chawal Udyog others versus State of U.P others 2008 NTN (231) 37. He has also placed reliance upon certain other decisions to buttress his argument that the Commissioner of Trade Tax has no power to issue any such circular which amounts interference in exercise of quasi judicial function by the authorities below to him. In reply, the learned counsel for the respondents submits that validity of the circular has not been challenged in the present writ petition. In any view of the matter, in the case of M/s Aryaverth Chawal Udyog (Supra) relied upon by the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the circular on the ground that the Commissioner of Trade Tax (hereinafter called as 'CTT') does not possess any such power. The said plea in the absence of any pleading or relief is not open to be canvassed but since the question of legality and validity of the said circular was put at the forefront of the arguments, we now proceed to deal with it. The main plank of the petitioner s argument is that the impugned circular by the CTT amounts interference in the quasi judicial function of the Assessing Authority. The law does not authorize CTT to issue any such circular like the present one which may interfere in the judicial functioning of an authority. Strong reliance was placed on M/s Hindustan Aluminium Corporation Ltd. Versus State of Uttar Pradesh and another, 1977 UPTC 81, the following portion of paragraph in particular. In the first place, it is not disputed that the Commissioner of Sales Tax has already issued a circular to all Sales Tax Officers and the Assistant Appellate Commissioner on the interpretation to be put on the notification dated 30th May, 1975 and informing them that all aluminium ingots should be treated as falling in the category of ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the circular that the judgment given by the Andhra Pradesh High Court in the Case of Aitha Narasaiah Co. and another versus State of Andhra Pradesh, 43 STC 183, is distinguishable due to peculiar statutory setting, is incorrect. In the case of M/s Aryaverth Chawal Udyog others versus State of U.P. others, 2008 NTN (37) 231, the Court has examined the validity of the circular on merits and reached to the conclusion that the impugned circular dated 29/30th March, 2007 issued by the CTT is in conformity with the plain language of Section 15(c) of the Act, vide paragraphs no. 41 and 42 of the said judgment. The said paragraphs are reproduced below: 41. In this view of the matter, we are of the view that there is no illegality in the impugned circular dated 29/30.03.2007 issued by the Commissioner of Trade Tax, which is inconformity with the plain language of section 15 (c) of the Central Act. 42. We have also examined the circular dated 18.03.1998. The said circular was issued in the case of new unit. We have perused the circular. There is nothing in the circular which provides the benefit of the reduction of tax leviable under the Central Act on the interState sale of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atnam Overceas (Export), etc. versus State of Haryana, 2002 UPTC 1211, wherein the Apex Court had an occasion to interpret Section 15(c) of the Central Tax Act. Although, in the circular, the CTT has independently took the view but is being in conformity with the ratio of M/s Satnam Overceas (supra) is in a sense reminds the trade tax authorities the correct exposition of law. In view of the above discussions, we repel the arguments of the petitioner's counsel relating to the validity of circular of CTT. Then, it was contended that the authorities below was not justified in initiating the proceedings under Section 21 of the Act, even if there is an escapement of turnover. The authorities should have invoked jurisdiction under Section 10-B of U.P. Trade Tax Act i.e. revisional jurisdiction of the Act. The above argument was advanced on the strength of a Division Bench decision of this Court in M/s United Tractors, Gorakhpur and another versus State of Uttar Pradesh and others, 1996 UPTC 1185. Firstly, no such plea has been set out either in the body of the writ petition or in the grounds. Secondly, a close reading of the judgment of M/s United Tractors (supra) would show t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... besides the other thing, the Additional Commissioner (Grade-I) Commercial Tax, Lucknow has granted permission under Section 21(2) of the Act, therefore, the case is being reopened. For the sake of convenience, the said notice is extracted below: A reading of aforesaid two notices would show that the impugned notice in the present case is based on the basis of circular no. 2313 dated 29th March, 2007 issued by the CTT informing that where central sales of rice has been made, the tax paid in the State Law on paddy cannot be adjusted against the tax liability on inter state of rice. Such adjustment is impermissible and if such adjustment has been made in the order, proceeding under Section 21(2) is desired. Meaning thereby, the notice under Section 21 is based on such circular of CTT and the circular as discussed herein above contains the correct exposition of law. Question is whether in this fact situation, the initiation of reassessment proceeding can be said to be valid or not. Together with it, it was argued by the petitioner's counsel that while framing the assessment order, the point in issue was discussed and therefore, taking a different view amounts to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eous character, the same would not warrant initiation of proceedings under the above section. If, however, the grounds are relevant and have a nexus with the formation of belief regarding escaped assessment, the assessing authority would be clothed with jurisdiction to take action under the section. Whether the grounds are adequate or not is not a matter which would be gone into by the High Court or the Supreme Court, for the sufficiency of the grounds which induced the assessing authority to act is not a justiciable issue. What can be challenged is the existence of the belief but not the sufficiency or reasons for the belief. At the same time, the belief must be held in good faith and should not be a mere pretence. (Emphasis supplied) In Sales Tax Officer, Ganjnam another v. Uttareswari Rice Mills, (1972) 30 STC 567, the Apex Court has held while considering the question with regard to validity of reassessment proceedings, the approach has to be practical and not pedantic. Any view which would make opening words of Section 12(2) [Orissa Sales Tax Act dealing with reassessment], unworkable has to be avoided. Keeping the principle of law as delineated above, it would be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ghaziabad and another, 2008 U.P.T.C. 392, it has been held that the change of opinion may arise even if some material has been brought on record after assessment has been completed or it may be because of result of lack of care or inadvertence on the part of the Assessing Officer. The relevant paragraphs is reproduced below: 50. First proviso to sub-section (2) of Section 21 of the Act empowers the authority to initiate proceedings for reassessment even in the case where there is a change of opinion. The change of opinion may arise even if some material has been brought on record after assessment has been completed or it may be because of result of lack of care or inadvertence on the part of the Assessing Officer. 51. In the case of M/s Shyam Babu (Supra) a Division Bench of this Court has held that Section 21 of the Act is wider than that of Section 147(a) of the Act and the escapement envisaged by Section 21 of the Act need not necessarily spring from a source extraneous to the original record and actin under Section 21 can be taken on the basis of material already on record at the time of the original assessment, if the escapement of assessment to tax was a result of lac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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