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TMI Blog2005 (5) TMI 624X X X X Extracts X X X X X X X X Extracts X X X X ..... ner No. 1-company. For the year 1993-94, petitioner No. 1 submitted statement of turnover for the months July, 1993 to March, 1994 and deposited the admitted tax due as required under the Act. Petitioner No. 1 also submitted annual return on its turnover to be Rs. 43,79,56,211.87. It claimed exemption from tax on account of having effected sales worth Rs. 3,98,00,957.78 in course of export deals. In pursuance of notice issued by the assessing authority, respondent No. 3, petitioner No. 1 produced its books of account and other relevant records, inter alia, the declaration forms in support of export sales for the aforementioned amount. Respondent No. 3 being satisfied in all respects on scrutiny of the materials available before it completed assessment vide assessment order dated January 30, 1996 passed under section 17(4) of the Act determining the gross turnover of the petitioner No. 1 at Rs. 43,79,56,212. The assessing authority thereby allowed the exemption claimed on account of export sales worth Rs. 3,98,00,958 and on adjustment of the admitted tax already paid to the tune of Rs. 79,63,277 an amount of Rs. 172 was taken to be the tax payable. Petitioner No. 1 duly paid the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich was by way of rectification of the original assessment order has been passed beyond the time as prescribed under section 37 of the Act, it was illegal and without any authority of law. Both the appellate authorities negated the contention on the ground that as the process for rectification had been initiated on June 4, 1997 which was within the permissible time-limit, the impugned order of verification/assessment could not be construed to be time-barred. No affidavit has been filed on behalf of the Revenue and, therefore, the statements made on oath in the writ petition remain unrebutted. Mr. Joshi has reiterated the stand taken before the appellate authorities. Drawing the attention of the court to section 37 of the Act, the learned Senior Counsel persuasively argued that having regard to the language employed in sub-section (1) of section 37 of the Act, it is manifestly clear that a suo motu rectification of any assessment order already made has to be mandatorily within a period of three years from the end of the financial year in which such assessment was made. He maintained that as the original order of assessment in question was made on January 30, 1996, any rectification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation to the competing arguments. As the rival contentions have been built up around section 37(1) of the Act, it would be apt to extract the same for ready reference. "37. Rectification of assessment and orders.--(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." A plain reading of the above provision of the Act yields the following features: (1) It permits rectification of an assessment order made under the Act by the authority comprehended therein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause the process thereof had been initiated within the period prescribed, would be opposed to the obvious mandate of law. Besides it would tantamount to presupposition of an unmindful omission on the part of the Legislature--a notion uncountenanced by the fundamental principles of interpretation. The High Court of Punjab and Haryana in State of Punjab v. P.O. Sales Tax Tribunal [2000] 119 STC 82 dealing with an identical issue arising out of section 21A of the Punjab General Sales Tax Act, 1948, authorising suo motu rectification of mistake apparent from the record within two years of the date of the earlier order, adjudged the impugned order passed beyond the period as invalid being barred by time. In Commissioner of Income-tax v. Gangaram Chapolia and Co. [1991] 187 ITR 594 the Orissa High Court while dealing with the same contention, vis-a-vis, section 154(7) of the Income-tax Act, 1961, prescribing a timelimit of four years for the amendment as envisaged therein, annulled the impugned order passed beyond time observing that in absence of any provision akin to section 5 of the Limitation Act for condoning the delay, the same was unsustainable. The Karnataka High Court in E.M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, held that the word "determination" could not be accorded a different meaning than the words "proceed to assess". It was of the view that the word "assessment" is comprehensive denoting entirety of the proceeding taken with regard to it and could not be limited to the final order alone unless there was something in the context of a particular provision necessitating such a meaning being contributed to it. The apex court, however, was categorical in observing that it was undoubtedly open to the Legislature or the rule-making authority to make its intention clear that on expiry of a prescribed period no final order of assessment could be made. It ruled that in such a case, the taxing authority certainly would be debarred from completing the proceeding beyond the period prescribed. The apex court noticed that no such intention was decipherable from the legal provision involved. In view of the unambiguous language appearing in section 37(1) of the Act conveying the pronounced intention of the Legislature interdicting the concerned authority from effecting suo motu rectification of any earlier assessment order beyond the period of three years from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arly conveyed, there is no scope for the court to innovate or take upon itself the task of amending or altering the statutory provisions. In that situation the judges should not proclaim that they are playing the role of a lawmaker merely for an exhibition of judicial valour. They have to remember that there is a line, though thin, which separates adjudication from legislation. That line should not be crossed or erased. This can be vouchsafed by 'an alert recognition of the necessity not to cross it and instinctive, as well as trained reluctance to do so'. (See: Frankfurter, Some Reflections on the Reading of Statutes in 'Essays on Jurisprudence'. Columbia Law Review, p. 51)" In view of the exhaustive and elucidative exposition of the law regarding interpretation of statutes and the unequivocal and determinate language of section 37(1) of the Act, I am of the considered view that the impugned rder of assessment/rectification having admittedly breached the time-limit prescribed thereby, cannot be sustained in law and on facts. The notice dated June 4, 1997 initiating the process of such rectification though within the time-limit sanctioned cannot save the order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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