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2014 (7) TMI 817 - HC - VAT and Sales TaxExcersice of power under section 12A of the Karnataka Sales Tax Act - Merger of order of the original authority with the order of the Appellate Authority - Rejection of returns filed - Whether the order of the Tribunal holding that the orders passed by the lower authorities is hit by the doctrine of merger and therefore it requires to be set aside is correct - Held that - where the subject matter of the original proceedings and the subject matter of the appeal proceedings is one and the same and the Appellate Authority pronounces on the said subject matter then the order of the original authority fuses or merges with the appellate order and therefore it ceases to be in existence - the application of doctrine of merger depends on the nature of jurisdiction exercised by the superior forum and the content or subject matter of challenge led or capable of being led it shall be determinative of the applicability of merger. If the subject matter of the original proceedings is not the subject matter of the appellate proceedings the doctrine of merger has no application. Then if on that aspect the original order is to be modified or altered the power is conferred on the original authority to do so. The said authority is at liberty to initiate proceedings for modification or alteration of the said order as the said order has not merged with the appellate order. The question whether the deductions given to the assessee in the earlier order is legal or not was not the subject matter of appeal in an appeal preferred by the assessee on other aspects and therefore if the Assessing Authority wants to reassess and rectify the mistake by initiating proceedings under section 12A of the Act it cannot be said that he has no jurisdiction to do so on the ground that the order passed by the original authority is merged with the appellate order. The Tribunal has not properly understood the concept of merger and the express words used by the Apex Court on which reliance is placed and committed a serious error in allowing the appeal. Therefore the orders of the Tribunal is not sustainable - Decided in favour of Revenue.
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