TMI Blog2016 (4) TMI 485X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment assessment, then, merely because the notice under sub-section (6) addressed and sent to the dealer is in the trade name and not the sole proprietress that would not be fatal. The Tribunal has referred, to the definitions and which, according to it, are relevant. Tribunal's order requires a registered dealer to furnish returns and if non filing of returns and non registration of a dealer enable the Commissioner to carry out best judgment assessment, that any notice being addressed and sent in the above manner would be an illegality and of such nature as to be termed as incurable. The Tribunal's opinion is that this is an incurable defect and not a mere irregularity. So, the Tribunal has declared the assessment to be non-est. Eventually, procedural rules and matters of Form cannot be elevated to such a status and position as would make every part or prescription thereof mandatory and incapable of substantial compliance. Such provisions do not mandate strict compliance and are capable of substantial compliance. It cannot be that the trade name is mentioned and not that of the sole proprietor or proprietress that the proceedings can be flawed to such an extent as to term the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ERENCE NO. 112 OF 2009 IN REFERENCE APPLICATION NO. 113 OF 2005 WITH SALES TAX REFERENCE NO. 4 OF 2010 IN REFERENCE APPLICATION NO. 112 OF 2005 WITH SALES TAX REFERENCE NO. 14 OF 2010 IN REFERENCE APPLICATION NO. 119 OF 2005 WITH SALES TAX REFERENCE NO. 15 OF 2010 IN REFERENCE APPLICATION NO. 120 OF 2005 JUDGMENT ( Per S. C. Dharmadhikari, J. ) 1) In all these applications, the Tribunal has referred the following question of law for opinion and answer of this court:- Whether on facts and circumstances of the case, the Tribunal was justified in law in holding that the assessment orders were non-est orders even though the person Mrs. Janaki Soman, proprietress of the business has accepted the notices, attended the assessment proceedings as well as the first appeal proceedings and has not challenged the legality of notice on the ground of issuing it in the trade name before the assessing authority, revisional authority as well as the first appellate authority only on the ground that the notices were issued in the 'trade name'? 2) We take the facts, as they are stated to be common to all the references, from Sales Tax Reference No. 4 of 2009. The applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5) The Second Appeals of the dealer came to be allowed not on consideration of merits thereof, but on a singular ground stated to be of law, namely, the assessment proceedings were vitiated for, notice has been issued in the trade name and not in the name of the sole proprietress. It was stated that M/s. Klip Nail Care is a proprietary concern and Ms. Janaki Soman is the sole proprietress thereof. The notice could not have been issued in the trade name M/s. Klip Nail Care, but should have been issued in the name of the proprietress. Such a invalid notice, according to the Tribunal, could not be a foundation of the proceedings. The proceedings, therefore, are not only invalid and illegal, but non-est. That part of the reasoning of the Tribunal reads as under:- 6. We have heard both the counsels. Perused the record. In view of the rival submission, it is felt necessary instead of looking to the merits of the case first to consider the additional plea taken on behalf of the appellant. It is needless to say that there is no impediment to take the new ground in the appeal on the point of law. A perusal of the registration certificate record certainly reveals that the appellant fir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imitation and the assessing authority lacked jurisdiction to pass any assessment order section 33(5) of the Bombay Act. The revision orders passed against such assessment orders which were passed after expiry of the limitation period are held to be without jurisdiction. In this context, the Tribunal has observed that even though the appellant has not challenged either the assessment notices, or the assessment orders, the facts remains that the assessment orders having been passed without valid jurisdiction were non-est or nullify and therefore, they were certainly assailable even in the collateral proceedings like revision. That being the position, the Administrative Assistant Commissioner of Sales Tax had no jurisdiction to revise a non-est order. There is therefore, no other alternative but to annual the impugned revision orders for want of jurisdiction. Accordingly, the Tribunal has set aside the revision orders and the first appeal orders in those revision proceedings. Shri Akhade, learned Assistant Commissioner of Sales Tax was not able to convince us to take the different view than the view already taken by this Tribunal in the case of M/s. Parwani Builders (supra). 6) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22 falling in Chapter IV of the BST provides for registration. Sub-section (1) thereof states that no dealer shall, while being liable to pay tax under section 3 or under subsection (6) of section 19, carry on business as a dealer, unless he possesses a valid certificate of registration as provided by this Act. Provided that the provisions of this sub-section shall not be deemed to have been contravened if the dealer having applied for such registration as in this section provided within the prescribed time or, as the case may be, within the period specified in subsection (6) of section 19, carries on such business. Now, this provision enables registration and of a dealer. The word dealer is defined in section 2(11) in the following manner:- 2 (11) dealer means any person who whether for commission, remuneration or otherwise carries on business of buying or selling goods in the State, and includes the Central Government, or any State Government which carries on such business, and also any society, club or other association of persons which buys goods from or sells goods to its members; Exception (I) An agriculturist who sells exclusively agricultural produce grow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ser is accepted by him or by the principal or nominee of the principal, shall, notwithstanding anything contained in clause (5A) or any other provisions of this Act, be deemed to be a dealer; (iii) a factor, broker, commission agent, del credere agent or any other mercantile agent, by whatever name called, who carries on business of buying, selling, supplying or distributing goods belonging to any principal or principals whether disclosed or not, shall, notwithstanding anything contained in clause (5A) or any other provisions of this Act, be deemed to be a dealer. 9) There is, thus, a definition of this word to mean any person, who whether for commission, remuneration or otherwise carries on business of buying or selling goods in the State, and includes the Central Government, or any State Government which carries on such business, and also any society, club or other association of persons which buys goods from or sells goods to its members. The Explanation, which is an Explanation to the entire clause specifies the persons and bodies as capable of disposing any goods and to be deemed as a dealer for the purpose of such disposal. That again specifies incorporated or uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner is not satisfied that the returns furnished by a Registered dealer in respect of any period are correct and complete, and he thinks it, necessary to require the presence of the dealer or the production of further evidence, he shall serve on such dealer in the prescribed manner a notice requiring him on a date and at a place specified therein, either to attend and produce or cause to be produced all evidence on which such dealer relies in support of his returns, or to produce such evidence as is specified in the notice. On the date specified in the notice, or as soon as maybe thereafter the Commissioner shall, after considering all the evidence which may be produced, assess the amount of tax due from the dealer. (4) If a Registered dealer fails to comply with the terms of any notice issued under sub-section (3), the Commissioner shall assess, to the best of his judgment, the amount of tax due from him. (4A) Where all the returns are filed by a Registered dealer for any year ending on or after the notified day within six months from the end of the year to which such returns relate,no order of assessment under subsection (3) of (4) in respect of that year shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment shall be completed within a period of eighteen months from the date of such order of revocation as referred to in the third proviso to subsection (4A) and the period of limitation laid down in this section shall be deemed tobe modified accordingly. (4C) Notwithstanding anything contained in this section or any other provisions of this Act, where the assessment involves a decision on the point which is concluded against the State by a judgment of the Tribunal and the State Government or the Commissioner has initiated any proceedings against such judgment before an appropriate forum, then the Commissioner may complete the assessment as if the point was not so decided against the State, but shall stay the recovery of such of the dues including interest and penalty, if any, in so far as they relate to such point, until the decision by the appropriate forum and after such decision modify the assessment order, if found necessary. (5) If a Registered dealer does not furnish returns in respect of any period by the prescribed date, the Commissioner shall, at any time, within eight years from the end of the year in which such period occurs, after giving the dealer a reasonabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 33 enables assessment of taxes and that is due from a dealer liable to pay tax. We are concerned in this case with sub-section (6). A bare perusal of sub-section (6) would indicate as to how if the Commissioner has reason to believe that a dealer is liable to pay tax in respect of any period, but has failed to apply for registration or failed to apply for registration within time as required by section 22, the Commissioner shall at any time within eight years from the end of the year in which such period occurs, after giving the dealer a reasonable opportunity of being heard, proceed to assess, to the best of his judgment, the amount of tax (if any) due from the dealer in respect of that period, and any period or periods subsequent thereto. 13) We do not see how within the meaning of sub-section (1) of section 33 and in the light of the above clear legal provisions, a sole proprietor/dealer cannot be brought to tax. If he can be brought to tax and his income assessed on the basis of the transactions of sale and purchase of goods undertaken by him/her and that section also enables the Commissioner to carry on best judgment assessment, then, merely because the notice under su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o not think that description by the trade name is a contravention of these Rules or the Form. Eventually, procedural rules and matters of Form cannot be elevated to such a status and position as would make every part or prescription thereof mandatory and incapable of substantial compliance. Such provisions do not mandate strict compliance and are capable of substantial compliance. It cannot be that the trade name is mentioned and not that of the sole proprietor or proprietress that the proceedings can be flawed to such an extent as to term them as incurable. This is not a fundamental flaw or defect going to the root of the case. It will have to be established and proved that there is a prejudice or miscarriage of justice. Merely because the trade name been incorporated or inserted in the notice does not mean that the dealer was prevented from contesting the proceedings or the exercise carried out by the commissioner under sub-sections (5) or (6) of section 33. Eventually, the dealer must be put to notice. The form is not mandatory and the requirement of notice may be such. Therefore, absence of notice by such mis-description would have to be established and proved by the dealer, el ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd style Laxmi Stores, Residency road, Sadar, Nagpur . He was registered dealer for the purpose of sales tax. He passed away on 28th January, 1959. Yet, without any notice being issued, an assessment was made for the period 1st January, 1958 to 31st December, 1958 and Laxmi Stores was made liable to pay sales tax and penalty. Yet, for further period from 1st January, 1959 to 14th May, 1959 this business was assessed to tax and even a penalty was levied. The Division Bench noticed that part of the later period is after the death of Basantlal on 28th January, 1959. The most salient feature of the case was that the entire process commenced and concluded after the death of Basantlal and orders assessing the business to tax were passed on 5th December, 1960. That is much after the death of Basantlal. It is in these circumstances that the Division Bench concluded that not only the notice is illegal but the entire proceedings have to be quashed and set aside for, what the Commissioner sought to do was to proceed by issuing a notice only in the trade name. It is in this context that the Division Bench held that Laxmi Stores was merely a trade name of an individual and it was not by any me ..... X X X X Extracts X X X X X X X X Extracts X X X X
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