9911796707
TMI Blog2007 (11) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... h May, 1981 passed under Rule 41(7) of U.P. Sales Tax Rules, 1948, hereinafter referred to as 'the Rules', completed the original assessment by accepting the disclosed turnover. He, however, imposed a tax of Rs. 18.502.80 at the rate of 6% on the sale of ice. Thereafter it transpired that the tax on the sale of ice has been imposed at a lesser rate and it ought to have been 8% instead of 6% resulting in tax of Rs. 6167.60 being short levied. The proceedings under Section 22 of the Act were initiated by issuance of notice dated 2nd November, 1982 seeking rectification of the mistake which was apparent on the record. However, actual rectification was made vide order dated 4th September, 1984 wherein tax on sale of ice at the rate of 8% and interest was also imposed, Feeling aggrieved the opposite party preferred an appeal under Section 9 of the Act before the Assistant Commissioner (Judicial), Sales Tax, Jhansi Region, Jhansi, who vide order dated 20th September, 1985 had rejected the appeal. Still feeling aggrieved the opposite party preferred a second appeal under Section 10 of the Act before the Trade Tax Tribunal, Kanpur. The Tribunal vide order dated 6th July, 1987 had a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew should be taken. We have given our anxious consideration to the various pleas raised by the learned Counsel for the parties. 4. Provisions of Law The relevant provision of Sub-section (1) of Section 22 of the Act reads as under: (1) Any officer or authority, or the Tribunal or the High Court may, on its own motion or on the application of the dealer or any other interested person rectify any mistake in any order passed by him or it under this Act apparent on the record within three years from the date of the order sought to be rectified; Provided that where an application under this sub-section has been made within such period of three years, it may be disposed of even beyond such period; Provided further that no such rectification as has the effect of enhancing the assessment, penalty, fees or other dues shall be made unless reasonable opportunity of being heard has been; given to the dealer or other person likely to be affected by such enhancement. From a reading of the aforesaid provisions, we find that in the main part of Sub-section (1) any officer or authority, or the Tribunal or this Court has been empowered to rectify any mistake in any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver a significant omission. A plain reading of it indicates that it appears only in those cases where an application under Section 22 for rectification has been made. The rectification under the amended section can be done both on its own motion and on the application of dealer or any other interested person. As the words on its own motion are not included in the proviso the conclusion is inescapable that the Legislature intended to limit the extension of period beyond three years only in those cases where the application was filed by any dealer or any other interested person. |t may be that the words interested person may include Commissioner or Sales Tax as well but it cannot be accepted that the proviso can apply to proceedings which were initiated on its own motion. In other words in suo motu action the order has still to be passed within three years. As three years expired on 1-8-1984 the assessing authority was left with no jurisdiction to rectify the order on 22nd July, 1975. 2. India Steel Supply Co., Gorakhpur (supra) The assessment in this case was made on 27th August, 1979, the notice under Section 22 of the Act had been issued on 21st May, 1982 seeking rectifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned has proceeded to rectify the order within limitation and actual rectification made after three years would not be defective. This view was expressed on the basis of Kerala High Court decision in the case of Sha Vajeshankar Vasudeva and Co. (supra). The Division Bench did not go into the question as to whether Kerala High Court has correctly interpreted the decision of the Apex; Court or not. 4. Sudarsanam Iyengar Sons (supra) In this case the Apex Court was considering the provisions of Rule 33 of theTravancore Cochin General sales Tax Rules, 1950 in respect of the Assessment Year 1962-63, which was to the following effect: Rule 33(1). If for any reason the whole or any part of the turnover of business of a dealer or licensee has escaped assessment to tax in any year or if the licence fee has escaped levy in any year, the assessing authority or licensing authority, as the case may be, subject to the provisions of Sub-rule (2) may at any time within three years next succeeding that to which the tax or licence fee relates determine to the best of his judgment the turnover which has escaped assessment and assess the tax payable or levy the licence fee in such turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years from the date of the order, the mistake can be rectified even beyond the period of three years. Thus the decision of the Apex Court in the case of Sudarsanam Iyengar Sons (supra) would not be applicable to the present case. 5. Sha Vajeshankar Vasudeva and Co. (supra) In this case the Karnataka High Court has followed the decision of the Apex Court in the case of Sudarsanam Iyengar Sons (supra) (supra) and has held that there is difference between the power of limitation and reassessment. It has held as follows: I am of the view that even in the case of a rectification of a mistake in the order of assessment, a notice issued by the assessing authority to the assessee asking the assessee to show cause as to why the order of assessment should not be rectified should also be considered as an integral part of the rectification proceedings because without the issue of such notice and giving reasonable opportunity to the assessee, it would not be open to the assessing authority to make rectification of the order of assessment to the prejudice of the assessee. In substance, an order of rectification is also an order of assessment because an order of assessment aft ..... X X X X Extracts X X X X X X X X Extracts X X X X
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