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TMI Blog1963 (10) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... de in due course. The facts are these. The respondents had been assessed to sales tax under the Act in respect of various quarters by a Sales Tax Officer. They appealed to the Assistant Collector of Sales Tax against the assessments contending that the Sales Tax Officer had wrongly rejected their claim to certain deductions from their taxable turnover. The appeals were allowed. Subsequently the Orissa High Court delivered a judgment in another case from which it appeared that the Assistant Collector was wrong in allowing the deductions. Thereupon the Collector of Sales Tax acting under section 23(3) of the Act which provided that " the Collector may, upon application or of his own motion, revise any order passed under this Act...............by a person appointed under section 3 to assist him" revised the orders of the Assistant Collector by raising the taxable turnover allowed by him to be deducted. The respondents moved the High Court of Orissa under Article 226 of the Constitution to quash the orders of the Collector in revision on the ground that they were illegal under the Act as they had been made more than thirty-six months after the expiry of the quarters in respect of whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bserve that though section 12 talks of assessment by a Collector it includes assessment by other officers appointed under the Act to assist the Collector for under section 17 the Collector can delegate his powers to such officers, who are subordinate to him. I now turn to section 12. It has seven sub-sections each of which except sub-section (6) deals with assessment in a specified case. Each of them expressly provides for an order of assessment being made. The first sub-section deals with a case where the assessing officer is satisfied without hearing the dealer or taking evidence that the return is correct. The second sub-section covers a case where he is not so satisfied and provides for the assessment being made after hearing evidence. The third sub-section concerns a case where the dealer fails to attend or produce evidence when called upon to do so under the preceding sub- section. Sub-section (4) provides for a case where a dealer does not furnish returns which he is required by the Act to do. The fifth sub- section relates to a case where a dealer wrongfully fails to apply for registration. The sixth sub-section has earlier been set out. The last and seventh sub-section, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion containing it would not have been put in section 12 nor would the order have been described as an "order assessing the amount of tax due." It may be that the time-limit specified in the second proviso does not apply to an order of assessment under sub-section (7). That would not however affect the question. A recent amendment to section 12 has expressly provided that the time-limit in the second proviso does not apply to an order under sub-section (7). Lastly, it seems to me that if the second proviso in section 12(6) fixes a period of thirty-six months from the end of the period within which an order can be made under section 23(3) revising an order of assessment in respect of that period, the consequence would be so disastrous for the taxpayer that it could not have been intended. It would then be open to the Collector to make the application for revision preferred by a dealer against an assessment order made on him or against an appellate order, infructuous by the simple expedient of allowing the thirty-six months' time to pass. It is important to observe that there is no provision anywhere in the Act requiring the revising authority to dispose of an application in revisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not lead me to accept the view advanced by the respondents. The calamity and the anomaly resulting from it, to which I have earlier referred, seems to me to be much more serious than the inconvenience that it avoids. Further the inconvenience imagined seems to me to be more fanciful than real. It is not likely that the authorities would deliberately keep an appeal or a revision application pending for no reason at all as that would not given them any advantage whatever. I would for these reasons allow the appeals. DAS GUPTA, J.-These twelve appeals by the State of Orissa are in respect of twelve separate orders of assessment of sales tax that were made by the Collector of Sales Tax, Orissa, in exercise of his powers of revision under section 23 of the Orissa Sales Tax Act. The several dealers who are the respondents in the appeals moved the Orissa High Court under Article 226 of the Constitution for the issue of appropriate writs directing the State of Orissa not to collect the amounts which were said to have been illegally assessed. These several petitions have been allowed by the High Court and the orders of assessment made by the Collector have been quashed. The State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler does not furnish returns by the prescribed date. In such a case also the Collector shall also assess the tax to the best of his judgment after giving the registered dealer a reasonable opportunity of being heard. Sub-section (5) provides for assessment by the Collector of taxes due from a dealer about whom he is satisfied that he has been liable to pay tax under the Act in respect of any period and has nevertheless failed to apply for registration. Then comes sub-section (6) which runs thus: "(6) Any assessment made under this section shall be without prejudice to any prosecution instituted for an offence under this Act: Provided that when the Collector has imposed a penalty in addition to the amount assessed under this section, no further proceedings either revenue or criminal shall be taken against the dealer: Provided further that no order assessing the amount of tax due from a dealer in respect of any period shall be passed later than thirty- six months from the expiry of such period." Sub-section (7) provides that if for any reason the turnover of a dealer has escaped assessment or has been under-assessed the Collector may call for a return within 36 months of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court is wrong in holding that an order of assessment of revising authority is necessarily one made under section 12(7). The power of revision granted by section 23(3) is clearly a distinct and separate power from the power to assess after calling for a return in case of under-assessment or escaped assessment. The mere fact that in a particular case the revising authority has by a fresh order of assessment made the dealer liable for tax in respect of which he can be said to have been under-assessed or to have escaped assessment does not make the two powers one and the same. We therefore find it difficult to agree with the High Court that section 12(7) includes also the re- assessment made by the revising authority under section 23(3). The question however still remains whether accepting the position that the orders made by the Collector in the present case were not orders under section 12(7) they were still orders of assessment to which limitation prescribed by the second proviso to section 12(6) applied. On behalf of the appellant it is urged that the limitation prescribed in this proviso applies only to orders of assessment made under section 12 and that the impugned orders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have already set out the reasons for which we think that this provision of limitation, though it appears as a proviso in section 12(6), is in reality an independent legislative provision, as its subject-matter has nothing whatever to do with the main provision in section 12(6), or the proviso to sub-section (6) which precedes it. If therefore it is in truth an independent provision, unrelated to section 12(6) we do not see any logic or reason for importing into it the construction that its operation must be confined to an assessment under section 12, for read by itself on any reasonable construction it would appear to be a limitation imposed on any order of assessment made under the Act, i. e., under any provision of the Act. Assuming, however, for argument's sake that it applies only to orders of assessment under section 12, that construction is of no help to the appellant unless it can be said that the impugned orders of assessment were not made under section 12. We find it difficult to see how that can be said. It is true, no doubt, that the orders were made by virtue of powers conferred by section 23. But section 23 itself does not clothe the appellate or revising authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellate authority. We have, therefore, no hesitation in holding that even when an appellate or revisional authority is effecting a fresh assessment by enhancing it, it is exercising the power which is conferred by section 12, and, so to speak, doing the duty which an assessing authority would or ought to have performed. Any order of assessment made by the appellate authority or as in the present appeals by the revising authority must therefore be held to be orders passed under section 12 as well as under section 23. Consequently, the period of limitation prescribed in the second proviso in section 12(6) will in terms become applicable. But, says Mr. Sastri, look at the anomalous position that will arise if this period of limitation of 36 months be held to apply to appellate or revisional orders of assessment. In many cases, he rightly points out, it may happen that the original order of assessment will be made either on the last date of the 36 months' period or only shortly before that. In all such cases no appellate order or revisional order of assessment can possibly be made within this period of 36 months. Mr. Sastri has tried to persuade us that such a result could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expect that in the large majority of cases such a difficulty will not arise if the original order of assessment is made expeditiously so that it will be possible for the appellate authority or the revising authority to act within this period of 36 months. If in certain cases the difficulty does arise that is not, in our opinion, a sufficient reason, in view of the several considerations mentioned above, to think that the Legislature intended, without saying so, that the period of limitation prescribed applied only to original orders of assessment. Mr. Sastri drew our attention to a decision of the Patna High Court in Gajo Ram v. State of Bihar, where construing a somewhat similar proviso in section 10(6) of the Bihar Sales Tax Act, 1944, that Court held that the 24 months' period of limitation prescribed there applied only to original orders of assessment. The learned Judges appear to have been impressed by the argument that absurdity will result if the period of limitation for the original orders of assessment and orders of assessment made by the appellate or revisional authority be the same. For the reasons we have already mentioned, that argument does not appear to us to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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