9911796707
TMI Blog1995 (2) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... from July 1 and ending on June 30 of each year. For the co-operative year 1987-88, the assessee maintained its books of account for the period from July 1, 1987 to June 30, 1988. Accordingly, the accounts of the said year were closed on June 30, 1988 and the profit and loss account was drawn for the said period. The balance sheet was also prepared as on June 30, 1988. The assessee submitted its quarterly returns to the Sales Tax Officer as required by the Act. As the assessee's turnover of sales and purchases in the year did not exceed Rs. 12 lakhs, it was not liable to pay turnover tax under section 9 of the Act on its turnover of sales. The assessee also filed quarterly returns for the quarters commencing from July 1, 1988 as usual. The assessee, however, closed his account for the year commencing from July 1, 1988 on March 31, 1989, instead of June 30, 1989. This was done in compliance of the requirement of section 3 of the Income-tax Act, 1961, as substituted by the Direct Tax Laws (Amendment) Act, 1987, with effect from April 1, 1989, which provides that the previous year for the purposes of that Act means financial year only and not "any accounting year comprised of a period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 33A of the Act. Section 33 of the Act deals with assessment of taxes. Sub-section (1) thereof, with which we are concerned in the present case, reads: "33. Assessment of taxes.-(1) The amount of tax due from a dealer liable to pay tax shall be assessed separately for each year during which he is so liable: Provided that, the Commissioner may, subject to such conditions as may be prescribed, and for reasons to be recorded in writing, assess the tax due from any dealer during a part of a year: Provided further that, when a registered dealer fails to furnish any return relating to any period of any year, by the prescribed date, the Commissioner may, if he thinks fit, assess the tax due from such dealer separately for different parts of such year." "Year" has been defined in clause (37) of section 2 of the Act to mean: "(a) the financial year; (b) in relation to any particular registered dealer for the purposes of this Act (except section 3 and Chapter IV thereof), the year by reference to which the accounts of that dealer are ordinarily maintained in his books, but the dealer may by written declaration made by him in this behalf opt for the financial year: Provided that, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to the provisions of this section, during the period of three years from the date of commencement of the Bombay Sales Tax (Amendment and Validating Provisions) Act, 1988, the State Government may, as occasion arises, by order published in the Official Gazette, do anything not inconsistent with such provisions which appears necessary or expedient for the purpose of removing the difficulty." On a conjoint reading of clause (37) of section 2, sub-section (1) of section 33 and section 33A, the following position emerges in regard to the period for which assessment of taxes due from a dealer can be made: (1) The assessment of the amount of tax due from a dealer has to be made separately for each year during which he is so liable. [Sub-section (1) of section 33]. (2) Year means (i) the financial year or (ii) the year by reference to which the accounts of the dealer are ordinarily maintained. Even in a case falling under clause (ii) above, where a year different from the financial year is followed, for the purposes of section 3 and Chapter IV of the Act "year": will be the "financial year". [Sub-clause (b) of clause (37) of section 2]. (3) Assessment may also be made of the tax due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, there was no change. The change was effected in the year commencing from July 1, 1988. This year was changed by the assessee and the accounts were closed three months earlier on March 31, 1989. In such a situation, resort to the special provisions for transitional accounting year contained in section 33A was not necessary. The assessments could have been completed under section 33 itself by making one assessment order for the year commencing on July 1, 1987 and ending on June 30, 1988 and another for a part of the next year commencing on July 1, 1988 and ending on March 31, 1989, by exercising the powers under the first proviso to section 33(1) of the Act. This was not done by the Sales Tax Officer. He rather took resort to section 33A of the Act and made a single order of assessment for a period of 21 months. This action of the Sales Tax Officer is not correct for more than one reason. First, section 33A enables the assessing officer to make a single assessment in respect of a year of a duration longer than the earlier accounting year of the dealer, contrary to the scheme of the Act in regard to assessment which provides for assessment for a year or a part thereof, only in a c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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