Periodic sales tax returns can support assessment before year-end; such assessments are not merely provisional.

Under the Punjab General Sales Tax Act, the Supreme Court of India held that sales tax assessment could validly commence before the close of the assessment year on the basis of quarterly or other periodical returns. The statutory scheme required registered dealers to file such returns and pay tax accordingly, and empowered the assessing authority to accept them or call for evidence if dissatisfied; the Court rejected the argument that an annual tax could be assessed only at year-end and held that these assessments were not merely provisional.

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Issues: Whether, under the Punjab General Sales Tax Act, assessment of sales tax could validly be made on the basis of quarterly returns before the close of the assessment year, and whether such assessments were merely provisional.

Analysis: The statutory scheme required registered dealers to file periodical returns and to pay tax according to those returns. The assessing authority was empowered either to accept the returns or, if not satisfied, to require the dealer to appear and produce evidence. Although the tax was annual in character, the Act contemplated assessment on shorter periodic returns during the year. The reasoning that an annual tax could be assessed only at the end of the year was rejected, and the earlier contrary view was held inapplicable.

Conclusion: Assessment proceedings could validly be started before the expiry of the year on the basis of periodical returns, and such assessments were not provisional.

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