TMI Blog2016 (12) TMI 1737X X X X Extracts X X X X X X X X Extracts X X X X ..... atutory provision under Rule 6(5), once a return is filed, the officer is bound to complete the assessment, after the close of the year. If no action is taken for completing the assessment within a reasonable period, the assessee can treat the assessment as completed. Thereafter the only procedure that is available to reopen the assessment on ground of escaped turnover is under Rule 6(7). A procedure under Rule 6(5) cannot be adopted at any point of time. It has to be done within a reasonable time or atleast before the time stipulated in Rule 6(7) - Even going by the statutory provision under Rule 6(5), the assessment has to be completed within a reasonable time, which shall not be later than the period prescribed under Rule 6(7). Rule 6(5) clearly provides that for taking action in respect of incorrect or incomplete returns, enquiry has to be conducted by the assessing authority after giving the dealer an opportunity to prove the correctness and completeness of the return submitted by him. It is after issuing such a notice that the assessing authority shall proceed to determine the turnover to the best of his judgment. This process has to be initiated within the specified time. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year 2010-11. There is no reference to the pre-assessment notice. (viii) In WP(C) No. 4788/16, Ext.P1 is the notice under Rule 6 (5) for the assessment year 2009-10 issued on 13/8/2015 and Ex.P4 is the assessment order dated 30/11/2015. (ix) In WP(C) No. 5673/16, Ext.P1 is the assessment order in respect of assessment year 2010-11 and pre assessment notice under Rule 6(5) has been issued on 15/9/2015. (x) In WP(C) No. 12479/16, Exts.P1 to P4 are notices issued under Rule 6(5) on 14/10/2015 and Exts.P8 to P11 are the assessment orders. The assessment years pertain to 2007-08, 2008-09, 2009-10 and 2010-11. (xi) In WP(C) No. 13349/16, Ext.P1 is the assessment order dated 10/3/2016 in respect of the assessment year 2009-10. Notice is issued under Rule 6(5) of the CST Rules. (xii) In WP(C) No. 14103/16, Exts.P1 and P1A are the notices dated 4/3/2016 for assessment years 2006-07 and 2007- 08 respectively issued under Rule 6(5). Exts.P3 and P3A are the assessment orders dated 30/3/2016. (xiii) In WP(C) No. 14348/16, Ext.P1 is the notice under Rule 6(5) dated 11/1/2016 with reference to assessment year 2010-11 and Ext.P3 dated 15/3/2016 is the assessment order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itself is a valid return for CST Act also. 6. Let me now consider the provisions under the CST Act. Section 6 is the charging provision which indicates that subject to the other provisions contained in the Act, every dealer shall, with effect from the date notified in the Official Gazette by the Central Government, be liable to pay tax under the Act on all sales of goods other than electrical energy effected by him in the course of inter-state trade or commerce during any year on and from the date so notified. Section 9 relates to levy and collection of tax and penalties. As per Section 9(1), the tax is to be levied by the Government of India and the tax so levied shall be collected by the Government in accordance with sub section (2) in the State from which the movement of goods commenced. Section 9(2) reads as under:- (2) Subject to the other provisions of this Act and the rules made thereunder the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under the general sales tax law of the appropriate State shall, on behalf of the Government of India, assess, reassess, collect and enforce payment of tax, including any (inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te the assessing authority shall, after making such enquiry as he considers necessary and after giving the dealer an opportunity of providing the correctness and completeness of the return submitted by him, determine the turnover to the best of his Judgment and finally assess under a single order the tax or taxes payable under the Act for the preceding year or the year concerned. Such action may be taken in respect of a dealer who discontinues his business during the course of a year soon after such discontinuance. As per Rule 6(5), the assessing authority shall after the close of the year conduct scrutiny of the accounts and after such enquiry as he considers necessary satisfy himself that the return or returns filed are correct and complete and finally assess under a single order the tax or taxes payable under the Act for the preceding year or the year concerned. It is also open for the assessing authority to seek necessary explanation if it is found that the returns are incorrect or incomplete in which event it shall be open for the assessing authority to determine the turnover to the best of his judgment. 8. As per Rule 6(7), if it is found that the whole or any part of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... objection raising all the contentions. It is also submitted that an appeal has been filed against the above judgment which is pending consideration in WA No.1076/2013. 10. Yet another judgment that is relied upon is Malabar Gold Ornament Makers (P) Ltd. v. Asst. Commissioner (WP (C) No. 7179/2014 decided on 16/1/2015). In this case, the assessment of the petitioner under Rule 6(5) was completed on 1/10/2011 and thereafter Ext.P3 notice was issued on 26/2/2014. The assessment year was 2005-06. It was held that the notice was beyond the period of limitation. In the said judgment, the learned Single Judge relied upon a Division Bench judgment in WA No. 1018/2013, (State of Kerala v. Parisons Agrotech Pvt. Ltd.). In the said case, the Division Bench approved the finding of the learned Single Judge that assessment in terms of Rule 6(7) of CST Rules is barred by limitation. That was a case in which notice was issued proposing reassessment for escaped turnover for the assessment year 2003-04 by issuing a notice dated 31/8/2010. Therefore, there cannot be dispute regarding the fact that when a notice is issued under Rule 6(7), it has to be within 4 years from the period of limitation. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the assessing authority may at any time within 4 years from the expiry of the year to which the tax relates proceed to determine to the best of its judgment the turnover which has escaped assessment and assessed the tax payable on such turnover after issuing a notice to the dealer and after making such enquiries as he considers necessary. 13. In all these cases, the facts disclose that the notices are issued under Rule 6(5) and it has to be considered whether there is any period of limitation for invoking Rule 6(5). The statute does not provide for a period of limitation. Though such a question is pending before the Division Bench, when a contention is raised, it has to be decided. As matters stand now, there cannot be any dispute regarding the right of assessee to treat the assessments as completed within a reasonable time. If we look at the statutory provision under Rule 6(5), once a return is filed, the officer is bound to complete the assessment, after the close of the year. If no action is taken for completing the assessment within a reasonable period, the assessee can treat the assessment as completed. Thereafter the only procedure that is available to reopen the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the suo motu power of revision also, the revisional authority has to initiate the proceeding within a reasonable time. Any unreasonable delay in exercise may affect its validity. What is a reasonable time, however, will depend upon the facts of each case. 22. Our attention has been drawn to a decision in CST v. Halari Store wherein this Court, while considering the provisions of the Orissa Sales Tax Act, 1948 and the Rules framed thereunder, held: (SCC p. 721, para 11) 11. But, the same is not the position where the Commissioner decides to exercise his suo motu revisional power to revise an appellate order. Significantly, the words on his own motion occurring in the enactment are conspicuously absent in the proviso. Normally, a proviso is enacted to carve out something special out of the general enactment or to qualify what is in the enactment. By enacting the proviso the legislature has excluded the revisional jurisdiction of the Commissioner Sales Tax to revise an appellate order if invoked at the instance of a dealer or person when such dealer or person has a remedy by way of an appeal. As noticed earlier, the limitation on the suo motu power of the Commissioner as t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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