1973 (9) TMI 95 - HC - VAT and Sales Tax

Summary

Issues:
Assessment validity under Amendment Act 28 of 1969, Interpretation of Sections 9 and 10, Reopening of assessments, Tax liability determination, Validity of notices by Commercial Tax Officer.

Analysis:
The judgment pertains to an appeal from two writ petitions concerning the assessment of a dealer in turmeric for the year 1964-65. The dealer's transactions in turmeric were taxed on the first purchase point in the State, despite being sold outside the State. The dealer appealed this assessment, arguing that the transactions were not amenable to inter-State tax based on a previous decision. However, subsequent amendments through the Amendment Act 28 of 1969 introduced provisions affecting tax liability. Section 6 of the Act made dealers liable for inter-State trade taxes, even if no tax would have been leviable under the State's sales tax law. The Amendment Act also included sections 9 and 10, validating past assessments and providing exemption from tax liability under certain conditions.

The Commercial Tax Officer issued notices to dealers to claim exemption under section 10 or pay the assessed amount validated by section 9. The dealers challenged these notices through writ petitions, contending that assessments needed to be reopened to determine tax liability. The court analyzed the provisions of sections 9 and 10, emphasizing that assessments validated under section 9 were final and not subject to reopening. Section 10 dealt with exemption from tax liability based on specific conditions, placing the burden on dealers to prove non-collection of tax. The court clarified that the inquiry under section 10 did not involve reopening assessments or redetermining turnover but focused on exemption from tax payment.

The judgment highlighted that previous court decisions had upheld the validity of assessments under the Amendment Act, emphasizing that assessments validated under section 9 were conclusive unless challenged through appropriate remedies. The court dismissed the argument that section 8A of the amended Act required reopening of assessments, as it did not contain provisions for such action. Ultimately, the court found the notices issued by the Commercial Tax Officer to be valid and in accordance with the Act, leading to the dismissal of the writ petitions. The appeals were allowed, setting aside the lower court's judgment and ordering costs to be paid by the petitioners.