Revisional power cannot impose unproposed penalty beyond a best judgment assessment under the sales tax scheme

Under the Tamil Nadu General Sales Tax Act, a revisional authority exercising suo motu power cannot impose penalty if the assessing authority, while making a best judgment assessment, neither levied nor proposed such penalty in the pre-assessment notice. The revisional jurisdiction extends only to the order actually made and cannot be used to enlarge the matter under revision by introducing a fresh penalty issue that was never part of the original assessment proceedings. The Madras HC held that the Deputy Commissioner exceeded jurisdiction in levying penalty in revision, and the answer to the question was negative.

---

---

Issues: Whether the Deputy Commissioner, while exercising suo motu revisional power under section 32 of the Tamil Nadu General Sales Tax Act, 1959, could levy penalty when the assessing authority had made only a best judgment assessment under section 12(2) and had neither levied nor proposed penalty under section 12(3).

Analysis: The revisional power under section 32 extended only to the order actually made by the assessing authority. The assessment under revision was one passed under section 12(2), and there were no proceedings under section 16 sought to be revised. Since no penalty had been imposed or even proposed in the pre-assessment notice, the Deputy Commissioner could not independently invoke section 12(3) in revision to impose penalty. The revisional authority thus travelled beyond the scope of the order under revision and exceeded jurisdiction. The conclusion was consistent with the earlier view of the Court on the same statutory scheme.

Conclusion: The Deputy Commissioner had no authority to levy penalty in suo motu revision in the circumstances of the case, and the answer to the question was in the negative.

Ratio Decidendi: A revisional authority cannot, in exercise of suo motu revision, impose a penalty not levied or even proposed by the assessing authority when the original order under revision is confined to a best judgment assessment and no proceedings relating to that penalty are before it.

---