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TMI Blog2004 (11) TMI 533X X X X Extracts X X X X X X X X Extracts X X X X ..... r section 44(1) of the Act to show cause, and accordingly the petitioner filed its reply. The Superintendent of Taxes, thereafter, did not proceed with the said show cause notice. However, the Deputy Commissioner of Taxes issued notice under section 36(1) of the Act to the petitionercompany to show cause, and accordingly the petitioner-company filed their replies. Some correspondence went on and subsequently the Deputy Commissioner of Taxes, set aside the order of assessment and directed the Superintendent of Taxes to make fresh assessment. Accordingly, the Superintendent of Taxes issued further notices and thereafter the impugned order of assessment was passed. 4.. In this writ petition, the petitioner has challenged the initiation of suo motu revision by the Deputy Commissioner of Taxes as well as the impugned order passed by the Deputy Commissioner of Taxes, and the consequential orders passed by the Superintendent of Taxes. 5.. Before entering into the legal submission, we may briefly record the bare facts, which led to the order of revision/fresh assessment. 6.. The petitioner-company is engaged in the sale and supply of food products within the State of Assam and they s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty is entirely with that of the vendor, distributor or manufacturer. 10.. In this case, we find that the broad facts of the case are not in dispute. The returned goods were never shown in the stock book or included in the closing stocks, as these were never brought to the godown of the petitioner-company and those were destroyed. As regards the factum of destruction, the petitioner-company has filed affidavit from its distributor supporting such destruction. 11.. Dr. A.K. Saraf, learned senior counsel for the petitioner, has submitted that under the facts and circumstances of the present case, there was no material whatsoever to entertain a suo motu revision. As per the respondents' own statement this was a case of alleged escapement, for which the Superintendent of Taxes issued a notice and reply was given by the petitioner-company. The Superintendent of Taxes thereafter did not proceed further, which means that the Superintendent of Taxes was satisfied from the explanation furnished by the petitioner-company, and that was the end of the matter. 12.. Section 18(1) of the Act reads as follows: "18. Turnover escaping assessment. (1) Where after a dealer has been assessed u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 37(1) of the Act reads as follows: "37. Rectification of assessment and order. (1) The authority which made an assessment or order or passed an order in appeal or revision in respect thereof may, at any time within three years from the end of the financial year in which such assessment or order was made and of its own motion, rectify any arithmetical mistake or other mistake of a factual nature apparent from the record of the case, and shall even beyond such period, rectify any such mistake as is brought to its notice by a dealer or person affected by such order before the expiry of such time-limit: Provided that no such rectification shall be made having the effect of enhancing the assessment unless the authority concerned has given notice to the dealer or person of its intention so to do and has allowed him a reasonable opportunity of being heard." 15.. The power of rectification has also been given to the assessing authority and the time frame of three years have been provided. 16.. Section 36 provides for the power of revision and section 36(1) reads as follows: "36. Revision of order by the Commissioner. (1) The Commissioner may call for and examine the reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order. In our opinion, the use of different phraseology in the two sections is clearly indicative of the Legislature's intention to confer powers upon different authorities to deal with different situation and, therefore, the power exercisable by one authority cannot be exercised by another authority. In other words, the power vested in the Commissioner to suo motu call for the record of pending proceedings or decided cases to satisfy himself as to the legality and/or propriety of the pending proceedings or final order cannot be used for dealing with a case of escaped assessment which is the exclusive preserve of the Assessing Authority." 19.. In the State of Kerala v. K.M. Cheria Abdulla and Company [1965] 16 STC 875, the apex Court held: "It would not invest the revising authority with power to launch upon enquiries at large so as either to trench upon the powers which are expressly reserved by the Act or by the Rules to other authorities or to ignore the limitations inherent in the exercise of those powers. For instance, the power to reassess escaped turnover is primarily vested by rule 17 in the assessing officer and is to be exercised subject to certain limitations, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd produce the records as the assessing authority found that the petitioner-company had not accounted for the goods returned by the purchaser during the period. The reply furnished by the petitioner shows that the return of goods/destruction of the damaged goods was shown in the annual return and this was accepted by the assessing authority. We find force in the submission of the petitioner that as the assessing authority issued notice and after receipt of show cause, they did not proceed further, it can be safely inferred that the matter was dropped by them. Moreover, the revisional power cannot be exercised in the matter of reassessment of escaped turnover, which is expressly reserved for assessing authority. 22.. On perusal of the impugned order of the Deputy Commissioner of Taxes, we find that the revisional authority was of the view that the assessment orders for the years 1993-94 and 1994-95 were erroneous and prejudicial to the interest of the revenue as there was glaring suppression of sales. The revisional authority interfered in the matter on the following counts: "1. The assessment orders speak about the goods returned against which credit notes were stated to have b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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