TMI Blog2020 (3) TMI 997X X X X Extracts X X X X X X X X Extracts X X X X ..... incorrect application of law by the appellate authority in respect of the seized documents, we take note of that the appellate authority had rejected the seized documents by accepting the statement of the Manager (F A) of the petitioner assessee that the information contained therein relates to some other hotel and were obtained for the purpose of making a sales projection of the hotel before a financial institution. No further evidence had been brought in by the petitioner assessee that the information contained in the seized documents were of some other hotel and if yes, as to of which hotel, nor any evidence had been brought in that it was used for the purpose for making a sales projection before any financial institution for obtaining a loan - Merely because a stand was taken by the assessee, the burden of proof would not shift to the department. In such view, it would have to be construed that there was an incorrect assumption of facts by the appellate authority. The two circumstances required to exist for the purpose of invoking the suo-moto revisional power under Sections 36 (1) of the AGST Act and 82 (1) of the AVAT Act are present in the instant case and therefore we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004 under the Assam General Sales Tax Act, 1993 (for short, AGST Act) for ₹ 23,34,248/-, out of which ₹ 1,34,829/- was paid; for the period from April 2004 to September 2004 under the Luxuries Act for ₹ 36,50,134/-, out of which ₹ 2,63,010/- was paid; for the period from 2004 to 2005 under the AGST Act for ₹ 23,14,223/-, out of which ₹ 1,70,241/- was paid; for the period from April 2003 to September 2003 under the Luxuries Act for ₹ 34,50,180/-, out of which ₹ 1,58,662/- was paid; for the period from October 2005 to March 2006 under the Luxuries Act for ₹ 24,02,084/-, out of which ₹ 5,25,196/- was paid; for the period from April 2005 to September 2005 under the Luxuries Act for ₹ 29,56,606/-, out of which ₹ 4,13,227/- was paid; for the period April 2005 under the AGST Act for ₹ 2,14,974/-, out of which ₹ 12,727/- was paid. Accordingly as per the assessment orders dated 10.11.2006 out of the total amount of tax due i.e. ₹ 2,72,72,199/-, an amount of ₹ 27,70,536/- was paid. 4. The facts as well as the questions of law involved in all the revision petitions being the same, we propose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5(2) of the Luxuries Act which is extracted below:- 5. Taxing authorities and exercise of powers :- (1) Subject to the provisions of the Act and the rules made thereunder, the authorities competent to register, receive returns, assess or re-assess, recover and enforce payment of tax and imposed penalty under the Assam Value Added Tax Act, 2003 (Assam Act VIII of 2003), hereinafter referred to as VAT law, shall, within their local jurisdiction under the VAT law, be competent to register, receive returns, assess, re-assess, recover and enforce payment of tax including imposition of penalty due from any hotelier or proprietor whose place of business is located within such jurisdiction as if the tax were a tax under the VAT law and the hotelier or the proprietor was a dealer, within the meaning of the VAT law carrying on business within such jurisdiction and for this purpose they may exercise all or any of the powers conferred upon them by or under the Act. (2) Subject to the provisions of this Act and rules made thereunder, the provisions relating to security, interest, assessments and re-assessments, recover of tax, interest, penalty or any other sum including special mod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences, refunds, rebates, payment of interest compounding of offences and treatment of documents furnished by dealer as confidential, shall mutatis mutandis apply accordingly. From a reading of the provisions of Section 5 prior to its amendment as well as Sections 5(1) and 5(2) subsequent to the amendment, it is discernible that all the powers exercible by the various authorities under the AGST Act as well as the provisions for appeals, revisions etc, under the AGST Act would also mutatis mutandis be applicable in respect of an assessment and proceeding under the Luxuries Act in respect of such assessment orders which are of the period when the AGST Act was in force. Similarly all the powers exercisable by the various authorities under the AVAT Act as well as the provision for appeals, revision etc under the AVAT Act would also mutatis mutandis be applicable in respect of an assessment and proceeding under the Luxuries Act in respect of such assessment orders which are of the period when the AVAT Act has been in force. 8. The orders of the Superintendent of Taxes were assailed by the petitioner under Section 34(1) of the AGST Act or Section 79(1) of the AVAT Act, as the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the returns submitted to the department, they could very well have submitted a matching report to the police authorities. The acceptance of the appellate authority as to how it would be possible to have a turnover of almost ten times for a couple of assessment years as compared to the previous or subsequent years was found by the Assistant Commissioner of Taxes to be a perverse and malafide logical conclusion. The Assistant Commissioner of Taxes by following the pronouncement in VK Uchal Vs. Commissioner of Taxes, Mysore, reported in (1967) 20 STC 67 was of the view that impropriety can be said to have arisen where a decision is not based on evidence or is devoid of any such evidence and a reading of the order reveals that the decision was not based upon the materials upon which it was proceeded. A view was taken that if there is a lack of sufficient correlation between the evidence and the decision, it would constitute a source of impropriety. Accordingly, a conclusion was arrived that the order dated 29.01.2015 of the Deputy Commissioner of Taxes (Appeals) was found to be visited by errors of immense magnitude both in law and facts and, thereby causing grave prejudice to the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST Act an appeal is maintainable only against an order of the Commissioner of Taxes and not that of the Deputy Commissioner of Taxes (Appeals) and that as Section 33 (2) (b) of the AGST Act provides for an appeal by the Commissioner before the appellate tribunal against an order by the appellate authority, therefore a suo-moto revision would not be maintainable under Section 36(1). The other contention raised by Mr. KN Choudhury is that the power of the Commissioner to exercise the suo moto power of revision under Sections 36(1) of the AGST Act and 82(1) of the AVAT Act are circumscribed and subjected to the satisfaction of the existence of the circumstances referred therein and in the instant case, the circumstances referred in the said two provisions for a suo moto revision are not satisfied. A contention is also raised that the view taken by the learned Assam Board of Revenue as regards the requirement of further evidence as to which hotel the information contained in the seized documents belonged and with regard to any communication from the financial institution as regards the prospective loan to be obtained by the petitioner, for which the information contained in the seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt passed within the limits of jurisdiction of the assessing authority even if considered wrong by the revisional authority would not attract the exercise of suo-moto revisional power. 19. By relying on the aforesaid two pronouncements, Mr. KN Choudhury, learned Senior Counsel submits that the order dated 29.01.2015 of the appellate authority were neither an erroneous order nor prejudicial to the interests of the revenue and therefore the two circumstances required to exist in order to exercise a suo-moto power of revision were non-existent in the present case and hence the order dated 28.10.2015 of the Additional Commissioner of Taxes, Assam suffers from jurisdictional infirmity. 20. Per-contra Mr. D Saikia, learned senior counsel for the respondent authorities also relies upon the pronouncement of this court in Shri Rajendra Singh (supra) and also the pronouncement of the Supreme Court in Malabar Industrial Co. Ltd (supra) to substantiate his submission that the requirement of the order being an erroneous order and prejudicial to the interests of the revenue has been satisfied in the instant case so as to enable the Assistant Commissioner of Taxes to invoke the suo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gotiated with the financial institutions, a mere statement that that information contained in the seized documents related to some other hotel and was obtained for the purpose of projecting a sales turnover for the purpose of availing a loan, would be unacceptable. 22. Considering the view taken by the appellate authority as regards the acceptance of the seized documents for the purpose of the assessments made and the view taken by the revisional authority and the learned Assam Board of Revenue that the petitioner assessee failed to provide the required evidence to arrive at a conclusion that the information contained in the seized documents were related to some other hotel and were procured for the purpose of making a sale projection, we are required to examine whether the view taken by the appellate authority in the order dated 29.01.2015 can be termed to be erroneous order and prejudicial to the interests of the revenue . 23. In Rajendra Singh (supra) in paragraphs 9, 10 and 12, it had been held as follows: 9. The power of suo motu revision under Sub-section (1) is in the nature of supervisory jurisdiction and the same can be exercised only if the circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the accounts or by making some estimates himself. The Commissioner on perusal of the records may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the turnover at a higher figure than the one determined by the assessing officer. That would not vest the Commissioner with power to re-examine the accounts and determine the turnover himself at a higher figure. It is because the officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at a conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. It may be said in such a case that in the opinion of the Commissioner the order in question is prejudicial to the interest of the revenue. But that by itself will not be enough to vest the Commissioner with the power of suo motu revision because the first requirement, namely, that the order is erroneous, is absent. Similarly if an order is erroneous but not prejudicial to the interest of the revenue, then also the power of suo motu revision cannot be exercised. Any and every erroneou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with limitation and has to be exercised subject to the same and within its scope and ambit. So far as calling for the records and examining the same is concerned, undoubtedly it is an administrative act, but on examination to consider or in other words, to form an opinion that the particular order is erroneous in so far as it is prejudicial to the interest of the revenue, is a quasi-judicial act because on this consideration or opinion the whole machinery of re-examination and reconsideration of an order of assessment, which has already been concluded and set at rest, is set in motion. It is an important decision and the same cannot be based on the whims or caprice of the revising authority. There must be materials available from records called for by the Commissioner. 24. In Malabar Industrial Co.Ltd (supra), in paragraphs 7 and 10, it had been held as follows: 7. There can be no doubt that the provision cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer; it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before any financial institution for obtaining a loan. The appellate authority had taken an assumption that the return submitted by the petitioner assessee conform to the occupancy rate of the hotel submitted to the police authority. We also take note of that the appellate authority had not arrived at any corelation between the occupancy rate of the hotel and the sales turnover in respect of the sale of taxable goods such as cooked food etc., which was the subject matter of the tax imposed by the assessing authority. Further, it being the stated stand of the petitioner assessee that the information contained in the seized documents were of some other hotel and were procured for the purpose of making a sales projection to a financial institution for the purpose of availing a loan, the burden of proof that it was so would be on the petitioner assessee, but no material is available that they had discharged such burden. Merely because a stand was taken by the assessee, the burden of proof would not shift to the department. In such view, it would have to be construed that there was an incorrect assumption of facts by the appellate authority. 27. The phrase prejudicial to the intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the aforesaid provisions shows that Section 23 of the Act deals with appeals and revision. Sub-section (1) thereof provides that any dealer or person may prefer an appeal against the order of assessment or an order directing payment of interest or an order imposing penalty. Sub-section (2) of Section 23 deals with power of appellate authority in disposing of appeals preferred under Sub-section (1). Sub-section (3)(a) deals with second appeal which enables any dealer or State Government, as the case may be, to prefer appeal to the State Sales Tax Tribunal against the appellate order. Section 23 (4)(a) deals with the revisional power of the Commissioner of Sales Tax, which may be either suo motu or at the instance of a dealer or person against any order passed under the Act. The question, therefore, which requires consideration is whether an appellate order passed under Sub-section (2) of Section 23 of the Act comes within the ambit of the expression any order made under the Act occurring in Section 23(4)(a) of the Act. The language used in Section 23(4)(a) is plain, simple and there is no ambiguity in it. A plain reading of Section 23(4)(a) shows that the expression any order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en given by the Supreme Court that in view of a provision for an appeal by the State Government against the appellate order, a suo-moto revisional power under Section 23(4)(a) would not be available. 35. Further to arrive at an adjudication as to whether the provision for an appeal by the Commissioner under Section 33(2)(b) of the AGST Act would also by implication mean that the Commissioner would invariably have to resort to preferring an appeal rather than invoking the suomoto revisional power under Section 36(1) of the AGST Act, for the purpose, we look into the provisions of Sections 33(2)(b) and 36(1) of the AGST Act, which are extracted below:- 33(2)(b) By a dealer or a person or the Commissioner aggrieved by any final order passed in Appellate Authority insofar as such order relates to the assessment of turnover or the tax payable or to the imposition of any penalty under this Act, within sixty days from the date on which such order was served on him. 36(1) The Commissioner may call for and examine the records of any proceeding under this Act and if he considers that any order passed therein by any person appointed under sub-section (1) of section 3 to assist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under taken to remedy the error or the prejudice caused to the revenue. The Statue having provided two alternative options to the Commissioner, it would be left to the discretion of the Commissioner to exercise either of the two options and not be limited to exercise only the option of an appeal under Section 33(2)(b) of the AGST Act, provided the two conditions of Section 36(1) are satisfied. 37 In view of such conclusion, we are of the view that the contention of the petitioner assessee that in view of the provisions of Section 33(2)(b), providing for an appeal by the Commissioner against the appellate order, the suo-moto power of revision against such appellate order would not be maintainable, is liable to be rejected. 38. As regards the further contention of Mr. KN Choudhury, learned senior counsel for the petitioner that the view taken by the Assam Board of Revenue regarding the requirement of further evidence as regards the hotel to which the information contained in the seized documents belonged to and that no communication was made available from the financial institution as regards the loan to be obtained by the petitioner assessee, was erroneous and extraneous to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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