TaxTMI 
TaxTMI 
2017 (9) TMI 326
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....various suppliers and used the same in making of leaf springs. Petitioner, during said period, sold leaf springs worth Rs. 56,18,17,106/- in the State of Madhya Pradesh. That on the basis of earlier determination order dated 3.6.2003 petitioner paid MPVAT @ 4% on the sale of leaf spring and also filed returns during the relevant period. That in a suo motu proceedings drawn in exercise of powers under section 70 of MPVAT Act Commissioner, Commercial Taxes vide order dated 5.6.2007 reviewed the earlier order dated 3.6.2003 and 19.11.2003 which were passed under section 68 classifying leaf spring as iron and steel under Entry 30 (v) of Part II of Schedule II. However, by order dated 5.6.2007 it was held that the leaf spring being part of motor vehicles it was classified under Entry 1 of Part IV of Schedule II which is a residuary clause as it is existed at relevant time (Part IV of Schedule II now stand substituted by notification No.44 dated 17.12.2015 with effect from 18.12.2015) and subjected the leaf spring to 12.5 % tax under MPVAT Act. Evidently as the order dated 5.6.2007 was passed in purported exercise of powers under section 70 the same was to effective from a prospective da....
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.... Deputy Commissioner, Commercial Tax, passed the re-assessment order on 19.12.2014 holding leaf spring sold by the petitioner classifiable under Schedule-II Part-IV of the M.P. VAT Act liable to tax @12.5% raising the demand of Rs. 4,77,54,454/-. The demand for penalty proposed with show cause notice was however dropped. This order is under challenge in this writ petition. 9. The challenge is on two grounds; firstly, that it is beyond the jurisdiction of the authority concerned to reassess merely on the basis of change of opinion, which in turn is on the basis of a judgment and secondly, that being obligatory on the part of Assessing Authority to pass an order within one year from the date of initiation of proceedings, as contemplated under sub-section (3) of Section 21 of M.P. VAT Act. The order having been passed beyond one year is nonest in the eyes of law as it was beyond the jurisdiction of the authority to pass order after expiry of one year. 10. Though it is contended on behalf of the petitioner that impugned order passed after a period of one year from the date of initiation of proceedings, even after calculating the period during which the operation of the show-cause not....
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.... word "determine" was employed in Rule 33 with a definite intention to set the limit within which the final order in the matter of assessment should be made, the limit being three years. We find it difficult to accept that in the context of sales tax legislation the use of the words "proceed to assess" and "determine" would lead to different consequences or result. In this connection the words which follow the word "determine" in Rule 33 must be accorded their due signification. The words "assess the tax payable" cannot be ignored and it is clearly meant that the assessment has to be made within the period prescribed. Assessment is a comprehensive word and can denote the entirety of proceedings which are taken with regard to it. It cannot and does not mean a final order of assessment alone unless there is some thing in the context of a particular provision which compels such a meaning being attributed to it. In our judgment despite the phraseology employed in Rule 33 the principle which has been laid in other cases relating to analogous provisions in sales tax statutes must be followed as otherwise the purpose of a provision like Rule 33 can be completely defeated by taking certain....
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....hich was a case under section 147, 149 (1) (a) of the Income Tax Act, 1961 it was held: "2............... In any event, at the relevant time, when the assessment order got completed, the law as declared by the jurisdictional High Court, was that the civil construction work carried out by the assessee would be entitled to the benefit of Section 80-HH of the Act, which view was squarely reversed in CIT v. N.C. Budharaja and Co., 1994 Supp (1) SCC 280. The subsequent reversal of the legal position by the judgment of the Supreme Court does not authorise the Department to reopen the assessment, which stood closed on the basis of the law, as it stood at the relevant time." 14. In Binani Industries Limited, Kerala Vs. Assistant Commissioner of Commercial Taxes, VI Circle, Bangalore and others, (2007) 15 SCC 435, it is held: "24. The issues can be looked at from a different angle. Undisputedly, the 1996 Circular was binding on the revenue authorities as is spelt out in the case of 12.4.1996 and 23.10.1999 Circulars. The assessments were completed on the basis of 12th April, 1996 Circular. Merely because the Commissioner changes his view/opinion and according to him it was review of the....
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....One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the Assessing Officer. Hence, after 1st April, 1989, Assessing Officer has power to re-open, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief. Our view gets support from the changes made to Section 147 of the Act, as quoted hereinabove. Under the Direct Tax Laws (Amendment) Act, 1987, Parliament not only deleted the words "reason to believe" but also inserted the word "opinion" in Section 147 of the Act. However, on receipt of representations from the Companies against omission of the words "reason to believe", Parliament re-introduced the said expression and deleted the word "opinion" on the ground that it would vest arbitrary powers in the Assessing Officer." 16. In Eisher Motors Ltd. and another Vs. State of M.P. and others, 2005 (1) M.P.L.J. 408, learned Single Judge of this Court after relying on the decision by Supreme Court held: "7. A careful reading of provision reveals that expression 'escape' serves as a key and foundation of the jurisdi....
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....rection of mistake Section 19 of the Act of 1958 can not be invoked as held by the Division Bench of this Court in Commissioner of Sales Tax v. Filterco Neemuch, [1996] 29 VKN 162. In that case assessee, a registered dealer was manufacturing compressed woolen felts which were sold in State as well in the course of inter-State trade & Commerce. Assessee requested the Commissioner of Sales Tax to treat the merchandise covered under Entry No. 6 of Schedule I. The said request after due consideration was allowed and the sale turnover of woolen felts manufactured by assessee was not subjected to tax during the period 1971 onwards and no tax was levied. However, in Union of India v. Gujrat Woolen Felt Mill AIR 1997 SC 1548 it was held that non woven felts manufactured from woolen fibers by machine pressing and used for filtration in heavy industries were 'woolen fabrics' covered by Entry 21. Based upon that decision, Commissioner issued show- cause notice for reopening of assessment. Division Bench while answering the reference held in no uncertain terms that turnover considered exempted can not be treated as escaped assessment and in doing so authorities exceeded jurisdiction by....
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....ribed form appointing a place which may be the business premises or at such place specified in the notice to assess or reassess, as the 35 case may be the tax payable by such dealer after making such enquiry as he considers necessary, and assess or re-assess to tax." 19. Thus re-assessment of tax is permissible only when it has been under assessed or has escaped assessment, or has been assessed at a lower rate, or any wrong deduction has been made while making the assessment or a rebate of input tax has incorrectly been allowed, while making the assessment or is rendered erroneous and prejudicial to the interest of revenue. Consequent to or in the light of any judgment or order of any Court or Appellate Board, which has become final. Thus, except these circumstances no other grounds available for the Commissioner to reassess the tax. 20. In the present case evidently on the basis of earlier determination order dated 3.6.3003 the petitioner filed the return for the year 2006-07 and the assessment order was passed on 26.5.2009 accepting tax @ 4% on the leaf springs being declared goods under section 14 of CST Act. However, it was on the basis of the opinion formulated by order dat....