Sales tax reassessment notice valid where escaped turnover is later identified, and conscious omission does not bar reopening.

Reassessment under section 16 of the Tamil Nadu General Sales Tax Act was held not to be barred by limitation where notice was issued within the prescribed time, because the notice itself commences reassessment proceedings and the escapement need not be finally established before notice. The Court rejected the argument that limitation should run from the reassessment order and upheld the notice as valid. It further held that section 16 applies even when turnover was consciously omitted from the original assessment after the assessing authority accepted an exemption claim, since the provision covers turnover that has escaped assessment for any reason. The revision therefore failed and the reassessment was upheld.

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Issues: (i) Whether the reassessment under section 16 of the Tamil Nadu General Sales Tax Act, 1959, was barred by limitation and whether the notice initiating reassessment was without jurisdiction; (ii) Whether section 16 could be invoked where the turnover had been consciously omitted from the original assessment.

Issue (i): Whether the reassessment under section 16 of the Tamil Nadu General Sales Tax Act, 1959, was barred by limitation and whether the notice initiating reassessment was without jurisdiction.

Analysis: The appellate order setting aside the rectification was treated as operating retrospectively, with the result that the original assessment stood as one in which the turnover had escaped assessment. The notice under section 16 was held to be valid as the starting point of reassessment proceedings. The Court further held that the issue of notice is relevant for limitation and opportunity to object, and that the jurisdiction to reopen does not depend on the escapement being finally established before notice is issued. The limitation contention based on the date of the reassessment order was rejected.

Conclusion: The reassessment was not barred by limitation and the notice under section 16 was valid.

Issue (ii): Whether section 16 could be invoked where the turnover had been consciously omitted from the original assessment.

Analysis: The Court held that reassessment under section 16 is not excluded merely because the turnover was earlier omitted after the assessing authority had accepted the assessee's claim of exemption. The provision was held to extend to turnover that had escaped assessment for any reason, including cases where the officer had applied his mind and treated the item as exempt or not includible in taxable turnover.

Conclusion: Section 16 could validly be invoked notwithstanding the earlier omission of the turnover from assessment.

Final Conclusion: The revision failed on all grounds, and the revenue's reassessment was upheld.

Ratio Decidendi: For reopening under the sales tax reassessment provision, the relevant consideration is whether turnover has escaped assessment and whether notice is issued within the prescribed time, not whether the omission was inadvertent or conscious; the notice commences the reassessment proceedings and is not invalid merely because the escapement is yet to be finally established.

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