TMI Blog2009 (7) TMI 1194X X X X Extracts X X X X X X X X Extracts X X X X ..... y other subsequent factors and also should not have stated that it is not a court of law. Therefore, the authority, i.e., assessing officer has basically committed a mistake in stating that it cannot conduct a court of law. Rightly this has been set aside both by the first appellate authority and the second appellate authority, who are also actual fact-finding authorities, rightly concluded that such an attitude of the assessing authority in totally rejecting the contentions of the assessee without applying the basic principles of law, is not legal and valid in law. Hence, the reasoning of the appellate authority is valid in law and we do not find any reason to interfere with the said findings. The question of law is answered against the Revenue. - 2301 of 2008 - - - Dated:- 23-7-2009 - IBRAHIM KALIFULLA F.M. AND RAJENDRAN B. , JJ. ORDER:- The order was court was made by B. RAJENDRAN J. The assessee a dealer in silver articles and leg chains have reported a total and taxable turnover of Rs. 77,53,957 and Rs. 42,02,730, respectively for the year 1993-94 under the Tamil Nadu General Sales Tax Act, 1959. The assessing officer had disallowed the claim of exemption t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chains and waist cord at the time of inspection proves that the dealers were in the habit of selling silver articles to customers by raising sales of leg chain bills to circumvent/utilize the exemption granted by the Department. Based on all these allegations, the Tribunal after elaborate discussion and completely going into the merits of the case ultimately dismissed the appeal of the Revenue and confirmed the order of the Appellate Assistant Commissioner, Salem, clearly giving a finding that there was no bogus activities. Aggrieved against the order of the Tribunal, the Revenue has come forward with the present appeal. We have heard Mr. K. Radhakrishnan, the learned Government Advocate for the petitioner and Mr. C. Sivasubramanian, the learned counsel for the respondent. The learned Government Advocate wanted to make out a case on the following questions of law: 1. Whether, in the facts and circumstances of the case, the Tribunal is legally correct in having affirmed the order of the first appellate authority while the assessee had claimed exemption from tax on the purchase of silver leg chains for Rs. 13,41,528 and sales of silver leg chains for Rs. 12,25,023 and, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he contrary, the Department's attitude that inspite of the fact that the assessee was prepared to produce the concerned persons and also seeking for cross-examination of the concerned person was negatived is totally inconsistent in law, as rightly pointed out by the Tribunal that the Department has not followed the principles of natural justice, which is extracted below: . . . The Department did not find any stock of silver anklets or waist cords, during inspection. This would not mean that there was no sales of silver anklets throughout the assessment year. The Department issued summons to 14 sellers of silver anklets and silver articles and the summons were served on 9 of them which is the strong proof as to the genuineness of the assessee's purchases. Regarding the other five sellers also the addresses disclosed by the sellers were noted in the assessee's records of purchases and the Department did not inform the respondents about the summon returned by the five sellers which resulted in the denial of a fair opportunity to them so as to rebut the departmental findings. The dealers could have produced the sellers for an effective cross-examination. The assessing a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this forum also cannot be treated as questions of law, because, it is purely questions of fact, which has been very well decided by the authorities in terms of the findings of both the appellate authorities. At this juncture, it is pertinent to point out here that the assessing officer has totally not taken into consideration the very legal perception in which they have got the right to decide on the merits of each case. First of all, the assessing officer, who is evaluating the question of fact whether a particular person is liable to be taxed or exemption to be granted acts in a quasi-judicial function in discharge of such function the authority has got every legal right to seek for evidence, take into consideration the material records and also after analysing the details of facts, applying the law in the strict sense as made out under the concerned provision of law. All these cumulative works are entrusted with the concerned officer. In short, the officer acts more like a judge in evaluating the proposition of fact and law. The very authority stated in its order that, he cannot conduct a court of law is palpably wrong. The authority has not at all considered the crux of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cord. (1) An assessing authority or an appellate or revising authority (including the Appellate Tribunal) may, at any time within five years from the date of any order passed by it, rectify any error apparent on the face of the record: Note: The expression 'five years' substituted for the expression 'three years' by Act 78 of 1986 Gazette Notn., dated December 18, 1986 G.O.P. No. 1322 CT RE dated December 29, 1986 Effective from January 1, 1987. Provided that no such rectification which has the effect of enhancing an assessment or any penalty shall be made unless such authority has given notice to the dealer and has allowed him a reasonable opportunity of being heard. A reading of rules 12, 15(6) and 18(6) of the Tamil Nadu General Sales Tax Rules, 1959, is relevant for consideration. 12. Where any return submitted by a dealer appears to the assessing authority to be incorrect or incomplete, the assessing authority shall, before taking action under rule 11, issue a notice to the dealer calling upon him to produce his accounts, registers, records and other documents and prove the correctness and completeness of his return at a time and place to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J, 4, 5 or 7A. A reading of sections 54, 54A and 55 of the Act would clearly indicate that the authority is vested with all the powers including invoking of the provisions of Code of Civil Procedure in summoning the witnesses; compelling production of documents and also examining and cross-examining the parties in this regard by the assessee and above all these, the assessing officer is vested with a special power to collect or get information under section 54A of the Act. These two sections are clearly intended for utilising for the benefit of both the assessee and the Department to gather evidence or information from third parties, which will not otherwise be available for the purpose of assessment. The power under these sections (54, 54A and 55) may be used to establish, obtain accounts and other documents in the custody of other Departments like the Income-tax Department or other Departments and above all these things, further power is also granted to the authorities concerned, to rectify any error apparent on the face of the record. It is also pertinent to point out that the Legislature has thought it fit correctly to include in section 54 of the Act that an assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... General Sales Tax Act, 1959 discloses that the assessing authority is vested with all the powers conferred on a court by the Code of Civil Procedure for the purpose of summoning and enforcing the attendance of any person and examining him on oath or affirmation as well as compelling the production of any document. The said provision also enables the respondent to take action in the event of the summoned person failing to attend or produce the document called for. We are also governed by a decision of the Division Bench of this court in K.S. Shivji Co. v. Joint Commercial Tax Officer reported in [1965] 16 STC 769 (page 771 in 16 STC): . . . We need hardly observe that the assessment proceedings are quasi-judicial in nature and therefore the assessing authority has an independent duty to carefully scrutinise the materials for assessment and satisfy himself, thoroughly uninfluenced by any direction of superior officers, and assess the tax payable on that basis . . . We are completely in agreement that the assessment proceedings are quasi-judicial in nature and therefore, the assessing authority has an independent duty to carefully scrutinize the materials for assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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