9911796707
TMI Blog2006 (6) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... The learned counsel for the appellant submits that the learned single Judge, at the stage of preliminary hearing did not accept any one of the grounds and he had erroneously rejected the writ petition by answering the legal contentions against the appellant and in favour of the Revenue holding that the proceedings under section 12A(1) were initiated by the fifth respondent by issuing notice on September 30, 2002 to the appellant. The orders of reassessment were passed on August 18, 2005, which are within the prescribed period of limitation stipulated under section 22B of the KST Act. Apart from the said reason the observation of the learned single Judge stating that the appellant has got an alternative remedy under the provisions of the KST Act is factually correct. Therefore, the learned single Judge had rightly declined to grant relief and dismissed the writ petition at the stage of preliminary hearing itself. The correctness of the same is questioned before this court by placing strong reliance upon section 12A(1) of the Act read with rule 4 of the Rules. It is further urged that the fifth respondent, upon whom the power was conferred by the first respondent to reasses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for financial years 1995-96 and 1997-98 and if, the ending date of the financial year is taken into consideration, eight years have lapsed and therefore, on this ground also the orders of reassessment of escaped sales tax on turnover are vitiated in law and therefore liable to be quashed. Smt. Sujatha, the learned Additional Government Advocate appearing on behalf of the respondents, has sought to justify the reassessment orders passed by the third respondent, which are affirmed by the learned single Judge, inter alia, contending that the same are in conformity with section 12A(1) read with section 22B of the KST Act as the fifth respondent was appointed, though he may not be the assessing authority in terms of the definition of section 2(1)(f) of the Act read with rule 4 of the KST Rules as the gross turnover of the appellant is more than 7.5 lakhs and even less for making the reassessment of escaped turnover assessment for reassessment tax of the appellant. The first respondent has got statutory power under section 3A(1) of the Act to appoint any one of the officers mentioned in the said section as assessing authority for the purpose of passing reassessment orders regarding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 12A(1) of the Act for the above purpose. Therefore, she contends that the reliance placed upon rule 4 of the KST Rules by the appellant's counsel also does not support his case. Hence, she has contended that the contention urged in this regard is liable to be rejected. We have carefully examined the abovesaid rival contentions urged on behalf of the parties with reference to the relevant statutory provisions of the KST Act and Rules to answer the same on the basis of the legal contentions urged in the case. The following points would arise for our consideration and determination: (a) Whether the initiation of the proceedings by the assessing authority appointed under section 3A(1) of the KST Act in respect of the financial years of the appellant-establishment from 1995-96 to 1997-98 is within eight years as provided under section 12A(1) of the Act? (b) Whether the initiation of proceedings and passing of the reassessment orders by respondent No. 3 is within three years as stipulated under section 22B of the Act from the date of initiation of proceedings against the appellant? (c) Whether the order of the learned single Judge warrants our interference in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of eight years from the expiry of the year to which the tax relates, proceed to assess or reassess to the best of its judgment the tax payable by the dealer in respect of such turnover after issuing a notice to the dealer and after making such enquiry as it may consider necessary. . . . 22B. Limitation in regard to passing of orders in respect of certain proceedings. (1) Notwithstanding anything contained in sections 12A, 21 and 22A, where any proceedings are initiated under section 12A or any records have been called for under section 21 or 22A, the authorities concerned shall pass orders referred to in the said sections, within a period of two years from the date of initiation of such proceedings or calling for the records, as the case may be: Provided that in respect of proceedings initiated or records called for before the date of commencement of the Karnataka Taxation Laws (Amendment) Act, 1997, orders shall be passed within a period of two years from such commencement. . . . Rule 4. (1) An application for registration under sub-section (1) of section 7 shall be made not later than thirty days from the date on which the dealer becomes liable to pay tax und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scaped turnover for fastening the sales tax liability upon the dealer, the power of the first respondent is traceable under section 12A(1) which must be read with section 3A(1). Section 3A(1) empowers the Commissioner of the Sales Tax Department to appoint his subordinate officers to discharge their functions in respect of such areas or such dealers or class of dealers or of such cases or classes of cases as the Commissioner may direct them to reassess the sales tax due from the registered dealers to the department. This provision does not state conferment of power upon the officer of particular rank only for reassessment of sales tax on the basis of the total turnover of the dealer. The power conferred upon the first respondent for appointment of officers referred to in the provisions of section 3A(1) of the Act as assessing authority for reassessment is independent from the definition of assessing authority under section 2(1)(f) read with rule 4 of the Rules which provides for regular assessment of sales tax of a registered dealer. Therefore, the contention urged by the learned counsel for the appellant that the fifth respondent was not competent to reassess the escaped turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted by the vigilance squad. The date of submission of inspection report to the first respondent by the fifth respondent does not amount to initiation of the proceedings against the appellant for reassessment regarding escaped turnover fastening sales tax liability upon the assessee by passing reassessment order. The submission of the report by the fifth respondent to the first respondent was for initiation of the proceedings against the appellant for reassessment of turnover tax. The Commissioner-first respondent was required to find out whether the initiation of proceedings for reassessment of the assessment against the appellant was required or not under section 12A(1) of the Act on the basis of the materials collected by the Vigilance Officer from the appellant. The word proceedings is used in section 22B of the Act but the word notice is not used in the above provision. The phrase initiation of the proceedings as stated in the above provision has to be construed and understood by us as meaning that the proceedings can be initiated by issuing a notice to the assessee and that notice must be issued within eight years as provided under section 12A(1) of the Act for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellant for the above financial years and to pass reassessment orders. Therefore, the Commissioner has appointed the third respondent as the assessing authority for which he is empowered under section 3A(1) of the Act. Merely because the first respondent had withdrawn the conferment of power upon the fifth respondent to initiate proceedings against the appellant for reassessment of escaped turnover and fastening the sales tax liability, the proceedings already initiated were neither withdrawn nor cancelled. The proceedings were validly initiated by the fifth respondent as he was empowered to do so for the purpose of reassessment of sales tax on escaped turnover against the appellant, no doubt the proceedings were not concluded by him. The Commissioner of Sales Tax is empowered to confer power upon such officer including to withdraw the conferment of power upon such officer at any stage of the proceedings for valid reasons. The cancellation of appointment of the fifth respondent as per annexure G and appointment of the third respondent in his place cannot be construed as, the proceedings initiated by the fifth respondent were terminated as the proceedings were continued by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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