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TMI Blog2011 (1) TMI 1511X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the Taxing authorities are conducting frequent audits without describing the audit cycle in the Rules. Rule 41 is relevant for the purpose. Repeated conduct of audit amounts to harassment to the petitioner. The arbitrary power conferred on the assessing officer is violative of Article 14 of the Constitution. It is further contended that on the basis of such repeated audits conducted by the Department are in excess of the conferment of the power under Section 41 and Rule 41 of the Act and Rules. There is abuse of power conferred upon the Commissioner and the subordinate officers to whom power is delegated for the purpose of audit to prevent evasion of tax. It is further contended that as per Section 41 read with Rule 41 conducting audit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notice of the Commissioner. Moreover, the Audit Report is the clear subject matter of challenge, which can be scrutinized by the competent authority. Therefore, he submits that writ petition is liable to be dismissed. 4. We have carefully examined the pleadings advanced by the petitioner with a view as to whether it is required to strike down the provisions contained in Section 41 and Rule 41 of the Act and Rules. The said point is answered against the petitioner-dealer for the following reasons. It is worthwhile to extract the provisions prescribed under Section 41 and Rule 41 of the Act and Rules, which read as under : Section 41. Identification of tax payers for tax audit: (1) The commissioner may select such individu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asion of tax, if any, relevant for the purpose of investigation, assessment or such other purpose. Rule 41 : Selection of dealers for tax audit (1) The commissioner shall, under the provision of Section 41, select by the 31st of January or by any date before the close of every year, commencing from the appointed day, not less than twenty per cent of registered dealers for audit during the following year, by random selection with or without the use of computers : Provided that for the year coming with the appointed day, the selection of dealer for audit under this sub-rule shall be made by the 30th of September of that year. (2) The Commissioner, where considers it necessary to safeguard the interest of revenue or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) of Rule 41 is distinct and different and, in those circumstances, the Commissioner is otherwise at liberty to conduct such audit to plug evasion of sales tax. 7. In view of the reasons stated above, it cannot be said that the aforesaid provisions of the OVAT Act and Rules are unconstitutional. Therefore, the argument advanced by the petitioner fails. The argument advanced by the learned Standing Counsel for Revenue is well founded and the same is accepted. If there are frequent tax audits and arbitrary action by the subordinate officers with a view to harass the individual dealers or class or dealer, the same should be brought to the notice of the Commissioner. 8. In view of the contention raised by the learned Standing Counsel fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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