Assessing officer must consider belated returns; High Court rules in favor of assessees

The High Court held that the Sales Tax Officer erred in ignoring the returns filed by the assessees before the ex parte assessment order. The Court emphasized the obligation of the assessing officer to consider belated returns and ruled in favor of the assessees, directing the respondents to pay costs and refund fees. The reference under the Bombay Sales Tax Act was answered in the negative, favoring the assessees against the department.

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Issues:
Whether the Sales Tax Officer was justified in ignoring the return filed by the assessee in the circumstances of the case.

Analysis:
The judgment pertains to a reference under section 61(1) of the Bombay Sales Tax Act, 1959, made by the Sales Tax Tribunal, Bombay, concerning the justification of the Sales Tax Officer in ignoring the return filed by the assessees. The applicants, registered dealers under the Act, failed to file returns for certain periods, leading to best judgment assessments. Despite filing returns before the ex parte assessment order, the Sales Tax Officer did not consider them. The applicants appealed the assessment, which was dismissed by the Assistant Commissioner of Sales Tax, prompting a second appeal to the Tribunal.

The Tribunal held that it was unnecessary for the Sales Tax Officer to consider the filed returns due to the previous ex parte assessment. However, the High Court criticized this stance, emphasizing that the returns should have been taken into account before the best judgment assessment. The Court highlighted the legality of filing returns after the prescribed date and the obligation of the assessing officer to consider belated returns. Citing a judgment from the Madras High Court, the Court concluded that the Sales Tax Officer's failure to consider the filed returns was an error vitiating the assessment order.

Ultimately, the Court ruled in favor of the assessees, stating that the Sales Tax Officer's disregard of the filed returns was unjustified. The respondents were directed to pay the applicants' costs and refund the fee paid by them. The reference was answered in the negative, favoring the assessees against the department.

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