1996 (7) TMI 532 - HC - VAT and Sales Tax

Validity of Commercial Tax Officer assessments upheld for 1979-80 & 1980-81; jurisdictional issues rectified by 1985 Amendment Act.

The court upheld the validity of assessments made by the Commercial Tax Officer (Intelligence) for the assessment years 1979-80 and 1980-81. The ... - Issues Involved:1. Validity of assessments based on jurisdiction.2. Interpretation of section 4 and section 38(4) of the Andhra Pradesh General Sales Tax Act, 1957.3. Application of amendments by the Andhra Pradesh General Sales Tax (Amendment) Act, 1985.Issue-wise Detailed Analysis:1. Validity of Assessments Based on Jurisdiction:The core issue in these tax revision cases is the validity of the assessments on the ground of jurisdiction. The petitioner argued that the assessments made by the Commercial Tax Officer (Intelligence) were invalid due to the lack of proper jurisdiction. This contention was based on the precedent set in Sri Balaji Rice Company v. Commercial Tax Officer [1984] 55 STC 292, where it was held that the notification vesting power in the authority was ultra vires section 4 of the Andhra Pradesh General Sales Tax Act, 1957, and arbitrary. The petitioner contended that even section 38(4) of the Act did not cure this defect, thus the order of assessment should be set aside.2. Interpretation of Section 4 and Section 38(4) of the Andhra Pradesh General Sales Tax Act, 1957:The respondent, represented by the learned Special Government Pleader for Taxes, argued that the defects pointed out in the Sri Balaji Rice Company case had been rectified by the Andhra Pradesh General Sales Tax (Amendment) Act, 1985. The amendment to section 4 of the main Act allowed the conferring of jurisdiction on the officer, making the assessment valid and legal. The court needed to determine whether the amended section 4 and section 38(4) of the Act conferred the necessary power on the assessing authority and whether the order of assessment dated September 30, 1981, was within the jurisdiction of the assessing authority.3. Application of Amendments by the Andhra Pradesh General Sales Tax (Amendment) Act, 1985:The court examined the amendments made by the Andhra Pradesh General Sales Tax (Amendment) Act, 1985, which included changes to section 4 and the addition of section 38(4). The amended section 4 allowed the appointment of various tax officers to perform functions within specified areas or the entire State of Andhra Pradesh. This amendment addressed the issue raised in the Sri Balaji Rice Company case, where the court had held that the territorial jurisdiction of officers could not comprise the whole State of Andhra Pradesh.Section 38(4) of the Amendment Act provided that the amendments made by G.O. Ms. No. 434 and G.O. Ms. No. 1059 would be deemed to have always been incorporated in Notification-II of G.O. Ms. No. 1091. This provision validated the actions taken by the officers mentioned in G.O. Ms. No. 1091, including the exercise of assessment powers.The court noted that the Tribunal had correctly interpreted these provisions and held that the assessing authority had jurisdiction at the relevant time. The Tribunal also observed that the Commercial Tax Officer (Intelligence) had jurisdiction over two districts as a regular Commercial Tax Officer, thus validating the assessment.Conclusion:The court concluded that the Tribunal had not erroneously decided the question of law regarding the jurisdiction or authority of the Commercial Tax Officer (Intelligence) in assessing the petitioner. The amendments to section 4 and the addition of section 38(4) by the Andhra Pradesh General Sales Tax (Amendment) Act, 1985, cured the defects pointed out in the Sri Balaji Rice Company case. Therefore, the assessments made by the Commercial Tax Officer (Intelligence) for the assessment years 1979-80 and 1980-81 were valid. Consequently, the tax revision cases were dismissed, with no order as to costs.