1995 (1) TMI 321 - HC - VAT and Sales Tax

Issues Involved:

1. Validity of the Assistant Commissioner's jurisdiction under section 57 of the Bombay Sales Tax Act, 1959.
2. Scope of the expression "call for and examine the record of any order" under section 57 of the Act.

Detailed Analysis:

1. Validity of the Assistant Commissioner's jurisdiction under section 57 of the Bombay Sales Tax Act, 1959:

The case revolves around the business activities of an assessee dealing in kirana goods, sago, dry fruits, groundnuts, copra, etc., and the subsequent assessments made by the Sales Tax Officer for various periods. The Assistant Commissioner assumed revisional jurisdiction under section 57(1)(a) of the Act upon receiving complaints of under-assessment due to misclassification of goods. The revisional authority scrutinized the books of account and discovered significant improprieties and irregularities in the assessments, leading to a substantial under-assessment of tax. Consequently, the Assistant Commissioner issued a notice to the assessee to show cause for the revision of the assessment orders and ultimately passed a revisional order resulting in an additional tax demand and penalties.

The Tribunal upheld the initiation of the revisional proceedings, and the High Court affirmed this by stating that the power of revision under section 57(1)(a) is broad and not subject to any conditions precedent. The Court emphasized that the exercise of this power could only be challenged on grounds of arbitrariness, mala fides, or extraneous considerations, not on the nonexistence of any condition precedent.

2. Scope of the expression "call for and examine the record of any order" under section 57 of the Act:

The Court examined the scope and ambit of the expression "record of any order" in section 57(1)(a) of the Act. It noted that the term "record" is not explicitly defined in the Act or the Rules, but judicial interpretations have consistently held that it encompasses all evidence and documents that were before the assessing authority at the time of passing the order. The Court referenced the decision of the Gauhati High Court in Sri Pankaj Kumar Dasgupta v. State of Tripura, which articulated that "record" includes all proceedings and evidence on which the order is based but does not extend to fresh evidence not available at the time of the original order.

Applying this interpretation, the Court found that the books of account and documents scrutinized by the revisional authority were indeed part of the record before the assessing authority. Therefore, the revisional authority was justified in examining these records to identify improprieties and irregularities in the assessment orders. The Court clarified that the revisional authority could not consider any new material or evidence not before the assessing authority at the time of the original assessment. If new evidence emerged post-assessment, the appropriate recourse would be reassessment under section 35, not revision under section 57.

Conclusion:

The Court concluded that the Tribunal was correct in holding that the expression "record" in section 57(1)(a) includes the books of account based on which returns were filed and assessments made. It affirmed that the revisional authority acted within its jurisdiction in revising the assessment orders based on the records available at the time of the original assessment. The Court answered both questions in the affirmative, favoring the Revenue, and stated there would be no order as to costs.

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