TMI Blog2014 (3) TMI 782X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment regulated by the terms of a contract between the assessee and the assessing authority to arrive at the same destination - the dealer who had voluntarily and with full knowledge of features of alternate method of taxation has opted to be governed by it, a fortiori cannot in the lean season, claim for his assessment to be made under the regular assessment in the same assessment year - This has been taken note by the assessing authority and the First Appellate Authority and by the High Court - High Court has not committed any error. Decision in the case of Venus Castings (P) Ltd [2000 (4) TMI 37 - SUPREME COURT OF INDIA] and Supreme Steels & General Mills and Ors [1996 (11) TMI 355 - SUPREME COURT OF INDIA] followed – Appeal dismissed – Decided against assessee. - Civil Appeal No. 5000 of 2004 - - - Dated:- 12-12-2013 - H. L. Dattu And C. Nagappan,JJ. ORDER 1. This appeal is directed against the judgment and order passed by the High Court of Kerala at Ernakulam in T.R.C. No. 70 of 1997, dated 25.02.2003. 2. The assessee is a dealer in arrack. We are concerned with the assessment year 1993-1994. The regular rate of tax on the sale of arrack is 12.5 per cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise of the order passed by the High Court which is the subject matter of this Civil Appeal. 7. We have heard learned counsel for the parties to the lis. 8. In order to answer the issues canvassed by learned counsel for the appellant we need to notice Sections 7, 7(14), Form 21 and Form 21A of the Act and Rule 30 of the Kerala General Sales Tax Rules, 1963. 9. Section 7 of the Act is the charging section which provides for payment of tax at compounded rates. The Sub-Section (1) is extracted omitting what is not relevant for the purpose of this case. Sub-Section (1) read as under: "7.Payment of tax at compounded rate :- (1) Notwithstanding anything contained in Sub-Section (1) of Section 5." [(A)xx][(a) any dealer in gold or silver ornaments or wares, may, at his option instead of paying tax in accordance with the provisions of that Sub-Section, pay tax at one hundred and fifty per cent of the tax payable by him as conceded in the return or accounts for the immediate preceding years.] 7(14): Notwithstanding anything contained in Sub-Section (1) of Section (5), any dealer who is having licence for retail sales in arrack, may at his option instead of paying tax in accordan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rules are not relevant for the purpose of disposal of this appeal. 12. A bare reading of Rule 30 of the Rules would indicate that a dealer who is liable to pay tax at the compounded rates under Section 7 of the Act and who desires to use the option provided under Section 7(14) of the Act may file an application for permission before the concerned assessing authority in the form prescribed, namely, Form 21 on or before first day of the month of May in the year. 13. The Rule making authority has provided the discretion to the assessing authority to permit an assessee to make an appropriate application beyond the period prescribed under Rule (1) of Rule 30 after he is satisfied that the assessee was prevented from not filing the application within the time limit prescribed for good and sufficient reasons. 14. Sub-Rule (2) of Rule 30 stipulates that assessing authority shall make appropriate enquiries and pass suitable orders granting or rejecting the application that may be filed by the assessee. In order to satisfy the principles of natural justice, the rule provides that no application shall be rejected by the assessing authority without affording an opportunity of hearing to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had again approached the assessing authority to cancel the permission that was granted to him earlier under Section 7(14) of the Act read with Rule 30 of the Rules on the ground that the assessee had closed his business. 19. The request of the assessee came to be rejected by the assessing authority and in that the assessing authority has observed that once the permission is granted to pay tax at the compounded rates, the assessee cannot request the assessing authority to permit him to withdraw his earlier application and requests for completion of assessments under Section 17 of the Act. In the words of the assessing authority "the request for cancellation of compounded permission, cannot be accepted as per the Kerala General Sales Tax Act and the Rules. Further, the dealer has enjoyed the benefits granted to dealers who have opted for compounding system of payment of tax. Under such circumstances, the final assessment for 1993-94 upto stoppage of business is completed ..." 20. Aggrieved by the said rejection as we have already noticed, the assessee has unsuccessfully filed an application before the Appellate Assistant Commissioner who confirmed the order passed by the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an express and unequivocal cancellation by one party'. The right of rescission is only available when the consent of the party is obtained by fraud, misrepresentation, coercion or undue influence. Therefore, the dealer having once exercised its option under the composition scheme cannot, therefore be permitted to turn around and rescind from its liability merely on the ground that he had no turnover due to losses or had not done any manufacturing activity during the relevant year only for the reason that amount payable under the composition scheme is not relatable to any annual turnover but depends upon the agreement under the scheme at the option of the dealer. In other words, the assessee once having opted for composition and upon the completion of assessment cannot blow hot and cold at the same time, requesting the assessment authority for regular assessment under the Act. The aforesaid position of law is explained in the case of Commissioner of Central Excise and Custom vs. M/s Venus Castings (P) Ltd., wherein this Court while considering the provision of Section 3A(4) of the Central Excise Act, 1944 and Rule 96ZO(3) of the Central Excise Rules, which envisaged the composition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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