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TMI Blog2016 (7) TMI 439X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 69 of the Gujarat Sales Tax Act, 1969 made an application before the Tribunal to refer to this Court a question of law arising out of Tribunal s judgement and order dated 24.11.1993 in Second Appeal Nos. 304 to 307 of 1990 and 227 of 1991. Accordingly, a statement of case was drawn on 17.02.1995 referring the following question of law by way of Reference Application No. 11 of 1995: Whether on the facts and in the circumstances of the case the Tribunal was right in holding that the assessment order passed under Section 41(3) of the Gujarat Sales Tax Act, 1969 is time barred in view of the provisions of Section 41(3) read with Section 42(1) of the Act? 3. The applicant is carrying on business of manufacturing Paver Finisher Machine and its parts and is registered as a dealer under the Act. The applicant had collected and paid sales tax on the said machine as per entry 16(1) in Schedule II-A of the Act. However, the Sales Tax Officer issued a notice in Form 36 and passed assessment order on 31.03.1990 imposing tax as applicable to entry 13 in Schedule III to the Act on sales of Paver Machine. Accordingly an extra demand of tax in addition to the tax paid with the retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... satisfied that the declarations or returns furnished in respect of any period are correct and complete, he shall assess the amount of tax due from the dealer on the basis of such declarations or returns. (3) If the Commissioner is not satisfied that the declarations or returns furnished in respect of any period are correct and complete, and he thinks it necessary to require the presence of the dealer or the production of further evidence; he shall serve on such dealer in the prescribed manner a notice requiring him on a date and at a place specified therein, either to attend and produce or cause to be produced all evidence on which such dealer relies in support of his declarations or returns, or to produce such evidence as is specified in the notice. On the date specified in the notice, or as soon as may be thereafter, the Commissioner shall, after considering all the evidences which may be produced, assess the amount of tax due from the dealer. Provided that where a notice under this sub-section is not issued to the dealer - (a) on or before the 31st March, 1992, in relation to any year commencing on any day before the 31st March, 1990, or (b) within a period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if a dealer liable to pay tax has not employed regularly any method of accounting or if in the opinion of the Commissioner, assessment cannot be made properly on the basis of the accounts maintained by a dealer, the Commissioner shall assess to the best of his judgment, the amount of tax due from such dealer. (8) Any assessment made under this section shall be without prejudice to any penalty or prosecution for an offence, under this Act. 6. Section 42 of the Act provides for time limit to complete the assessment, which reads as under : - 42. Time limit for completion of assessment . (1) No order of assessment for a year commencing on the 1st day of April 1998, or part of such year or any year thereafter or part of such year shall be made under sub-section (3) or (4) of section 41 at any time after the expiry of three years from the end of the year in which the last monthly, quarterly or, as the case may be, annual return is filed. (2) Where the Commissioner issues a notice under sub-section (6) of section 41, to any dealer for assessment of tax in respect of any period, no order of assessment shall be made for such part of the period, if any, as is prior to - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(5) of the Act. But the important aspect is that, the process for the best judgment would be available even in cases where the assessee has not employed regularly any method of accounting, Assessing Officer cannot make proper assessment on the basis of accounts maintained by the Dealer and such situation is taken care of by Section 41(7) of the Act. But be it recorded that principal assessment, in cases where subsection 7 of Section 41 of the Act is applied and the dealer is having registration, would be under Section 41(3) read with 41(4) of the Act if the returns are filed but the assessment may be under Section 41(5) of the Act if the returns are not filed. However, in cases where the assessee or the Dealer, has not obtained any registration as required, a separate procedure under subsection 6 of the Section 41 of the Act has been provided. But even in those cases, it may be open to the Assessing Officer to invoke the provision of Section 41(7) of the Act. But in those cases, the assessment will be made under Section 41(6) read with 41(7) of the Act. The aforesaid shows two separate modes of assessment broadly; one of a dealer who is registered with the sales tax authority and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eight years or four years as the case may be. 10. We cannot countenance the submission made by learned Assistant Government Pleader for two reasons, one is that for applying the time limit as provided under Section 42(2) of the Act, the condition precedent is issuance of notice under subsection 6 of the 41 of the Act, and only, thereafter the question of applying time limit of eight years or four years may arise. But not in a case where no notice under Section 41(6) of the Act has been issued. Therefore, all assessment barring the assessment made after issuance of the notice under Section 41(6) of the Act, would stand covered by the provisions of Section 42(1) of the Act for the time limit within which the assessment has to be completed. The second reason is that subsection 6 of Section 41 of the Act does not include the contingency of non filing of the return, but rather the basic requirement is that the registration is not obtained or the person who has failed to apply the registration within the time prescribed. In any event as observed by us herein above, Section 41(7) is no independent mode of assessment but rather a step in furtherance to the assessment which is applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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