Annual assessment under a part-year proviso remains valid, while recorded reasons must be disclosed to the assessee.

A proviso allowing assessment for part of a year under the Orissa Sales Tax Rules was treated as an exception to the general scheme of annual assessment and did not, by itself, deprive the assessing authority of power to complete a whole-year assessment. The authority was therefore not barred from assessing the dealer for the full year. On disclosure of reasons recorded for invoking the proviso, the assessee was entitled to obtain those reasons; fairness required access to the recorded grounds and an opportunity to produce accounts and documents before assessment was finalised.

---

---

Issues: (i) whether, after initiating assessment for part of the year under the proviso to Rule 28-A of the Orissa Sales Tax Rules, 1947, the assessing authority was precluded from making assessment for the whole year without issuing a fresh notice in Form VIII; (ii) whether the assessee was entitled to be communicated the reasons recorded in writing for invoking the proviso to Rule 28-A.

Issue (i): whether, after initiating assessment for part of the year under the proviso to Rule 28-A of the Orissa Sales Tax Rules, 1947, the assessing authority was precluded from making assessment for the whole year without issuing a fresh notice in Form VIII.

Analysis: The provisions governing returns and assessment were read together so that the annual return requirement under section 11 and the general rule of yearly assessment under Rule 28-A were not defeated by the exceptional power to assess a part of the year. The proviso to Rule 28-A only carved out an exception for sufficient reasons and did not take away the basic authority to assess the dealer for the full year on the basis of the statutory scheme. A part-period assessment, therefore, did not extinguish the power to make an annual assessment where the Act contemplated such assessment.

Conclusion: The assessing authority was not barred from assessing the petitioner for the whole year.

Issue (ii): whether the assessee was entitled to be communicated the reasons recorded in writing for invoking the proviso to Rule 28-A.

Analysis: The proviso required sufficient reasons to be recorded in writing for making a part-period assessment. The assessee complained that the reasons were not disclosed. The material placed before the Court showed that the assessee had been informed that the reasons would be available at the hearing, and the authority, being quasi-judicial, was bound to furnish copies if demanded. Without finally deciding the abstract question whether the statute itself compelled prior communication in every case, the Court held that the assessee could not be denied access to the recorded reasons in the circumstances of the case.

Conclusion: The assessee was entitled to obtain the recorded reasons.

Final Conclusion: The challenge to the year-wise assessment scheme failed, but the assessee was to be given the recorded reasons and adequate opportunity to produce accounts and documents before the assessment was completed.

Ratio Decidendi: A proviso permitting assessment for part of a year is an exception to the general rule of annual assessment and does not, by itself, divest the assessing authority of power to make an annual assessment under the statutory scheme; where reasons are recorded for invoking such proviso, a quasi-judicial authority must afford the assessee access to them when fairness requires it.

---