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M/s. S.K. INDUSTRIES Versus STATE OF GUJARAT

2016 (9) TMI 612 - GUJARAT HIGH COURT

Revisional powers of Assistant Commissioner of Sales Tax - period of limitation - section 67 of the Gujarat Sales Tax Act - manufacture and resale of oil, oil cakes deoil cakes etc - did the Assistant Commissioner exercise revisional powers within the period of limitation prescribed? - Held that: - the Commissioner on his own motion may exercise revisional powers within three years from the date of the order passed by a subordinate officer by calling for and examining the record of such order an .....

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d - petition allowed - decided in favor of petitioner. - SPECIAL CIVIL APPLICATION NO. 8270 of 2015 - Dated:- 2-9-2016 - MR. AKIL KURESHI AND MR. A.J. SHASTRI, JJ. FOR THE PETITIONER : UCHIT N SHETH, ADVOCATE FOR THE RESPONDENT : MR.TIRTHRAJ PANDYA, AGP ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The petitioner has challenged an order dated 11.12.2014 passed by the Gujarat Value Added Tax Tribunal ('the Tribunal' for short) rejecting the petitioner's revision applicat .....

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ods are sold within and outside the State. For the assessment year 1991-92, sales tax officer passed an order of assessment concerning the petitioner under section 41(3) of the Act on 06.05.1995. The petitioner received a notice dated 24.02.1999 issued by the Assistant Commissioner of Sales Tax calling for information relating to the purchases made by the petitioner during the period concerning the said assessment year. The Assistant Commissioner thereafter issued a notice dated 16.04.1999 to th .....

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n which, he observed that it had come to its notice that the Assessing Officer had not levied purchase tax from the petitioner upon calling for the record of the case on 06.04.1997. The order of assessment was passed on 06.05.1995 and the record was received by him on 06.04.1997 and perused, upon which, the said error was noticed by him. In his opinion, therefore, the revisional powers were exercised within the period of limitation prescribed under section 67 of the Act. 5. This order of the Ass .....

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974] 33 STC 353 and observed that as per the said judgment, exercise of revisional power commences when the Commissioner calls for the record and examines the same and in this view of the matter, the judgment of High Court in case of Om Metals & Minerals Ltd. (supra) is not applicable to the facts of the present case. 6. It is this judgment of the Tribunal which the petitioner has challenged in this petition. Appearing for the petitioner, learned counsel Shri Uchit Sheth took us through the .....

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is Court in case of Om Metals & Minerals Ltd. (supra) was concerned with the amended provisions of section 67 which are applicable in the present case. He pointed out that the decision in case of Om Metals & Minerals Ltd. (supra) was followed in the later decision in case of Atul Auto Ltd v. State of Gujarat, in Tax Appeal No.35 of 2007 and connected proceedings decided on 05.11.2015. 7. Taking us through the present statutory provisions contained in section 67 of the Act, counsel submit .....

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it has been held by this court that when in a taxation statute where literal interpretation leads to a result that does not subserve the object of the legislation another construction in consonance with the object can be adopted. 9. In case of Peerless General Finance & Investment Co. Ltd. (supra), the Court observed as under: 33. Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives th .....

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s, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything i .....

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s of encroachers and unauthorized occupants, the provisions contained therein are required to be interpreted by applying the rule of purposive construction or mischief rule which was enunciated in Heydon's case [(1584) 3 Co. Rep. 7a] and which has been invoked by this Court for construing different legislations. In Bengal Immunity Company Ltd. v. State of Bihar 1955 (2) SCR 603, S.R. Das, C.J.I. explained this rule in the following words:- "It is a sound rule of construction of a statut .....

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commonwealth, and 4th The true reason of the remedy; and then the office of all the judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro privato commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico." 11. On the other hand, learned AGP Shri Pandya opposed the petition contending tha .....

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years for revision would not make the exercise of revisional powers time barred. 12. The short question therefore that calls for consideration is did the Assistant Commissioner exercise revisional powers within the period of limitation prescribed. This exercise would have to be done on the basis of the statutory provision as it stood at the relevant time. For better understanding and interpretation of such provision however, we may have to start with the provision as it stood in the predecessor .....

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him, may call for and examine the record of any such order and pass such order thereon as he thinks just and proper; (b) the Tribunal, on application made to it against an order of the Commissioner not being an order passed under subsection (2) of section 55 in second appeal within four months from the date of the communication of the order, may call for and examine the record of any such order, and pass such order thereon as it thinks just and proper. (2) Where an appeal lies under section 55 a .....

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Act, the Commissioner on his own motion within five years from the date of any order passed by any officer appointed to assist him, could call for and examine the record of any such order and pass such order thereon as he thought just and proper. The period of limitation of five years from the date of the order under revision was thus, related to the Act of the Commissioner to call for and examine the record of such order. This statutory provision came up for consideration before Division Bench .....

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on must be completed within the specified period. 15. The Bombay Sales Tax Act was substituted by the Gujarat Sales Tax Act of 1969 which contained in section 67, a provision peri materia to section 57 of the Bombay Act. In the initial stage, the Commissioner was vested with the suomotu power of revision of any order passed by an officer appointed to assist him. The period of limitation prescribed for such purpose was three years from the date of the order. By the Act of 10 of 1979, with effect .....

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within three years from such order. Here, there was no additional obligation on his part to pass a final order thereon within such time as held by this Court in case of Jamnagar Motor Stores (supra). 16. Section 67 of the Act however underwent further changes by Gujarat Act 10 of 1992 with effect from 07.04.1992. Relevant portion of section 67 after such amendment reads as under: 67. Revision (1) Subject to the provisions, of section 66 and to any rules which may be made in this behalf, : (a) th .....

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2) of section 65 in second appeal [or under clause (a) in revision on an application)] within four months from the date of the communication of the Order may call for and examine the record of any such order, and pass such order thereon as it thinks just and proper. 17. It can thus be seen that with these amendments under clause( a) of subsection (1) of section 67, the Commissioner on his own motion may exercise revisional powers within three years from the date of the order passed by a subordin .....

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supra), Commissioner was required to and call for and examine the record of an order within three years from the date of such order without there being any additional requirement of passing final order thereon within any specified time. Now the Legislature in order to obviate the difficulties of the assessee, has added a provision that such order would have to be passed within 12 months from the date of service of notice of revision. The period of limitation of three years therefore must be seen .....

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elf. In our opinion, the amendment was made in order to ensure exercise of suomotu revisional powers by the Commissioner, does not remain open ended and there is finality of a pending issue. In order to bring about an early end to uncertainty, therefore, clause( a) of subsection (1) of section 67 now prescribes the period of 12 months from the date of service of notice for revision within which the Commissioner must pass his final order. We may compare this provision with clause( b) of subsectio .....

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992, the period of limitation of three years referred to in clause( a) thereof must be for the Commissioner to call for and examine the record of an order under revision, there would be a hitus in the process of the Commissioner's exercise of revisional powers. As per such an interpretation, though he is obliged to call for and examine the record of the order under revision within three years, and is further obliged to pass final order on the revision within one year from the date of notice .....

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upra) the Division Bench of this Court has held and observed as under: 16. The composition order under section 55A of the Act as noted hereinabove has been made on 31st March, 1998 and the impugned notice has been issued on 25th September, 2001 which is clearly beyond a period of three years from the date of the said order. Section 67 of the Act inter alia lays down that the Commissioner on his own motion within three years from the date of order passed by any officer appointed under section 27 .....

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