Reassessment of bus sales and separate commodity treatment upheld, rejecting second-sale exemption for old buses.

Section 16(1) authorised the assessing authority to reopen escaped turnover and reassess the earlier exemption on bus sales; the prior exemption granted by another officer did not bar revision, so the withdrawal of exemption was valid. The sale of an old bus was also treated as a distinct taxable commodity under the First Schedule, separate from its chassis and body components; payment of tax on those components did not make the assembled bus a second sale. Accordingly, the reassessment and levy on the sale of old buses were upheld, and the second-sale exemption was rejected.

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Issues: (i) Whether the Deputy Commercial Tax Officer was competent under section 16(1) to revise the earlier assessment and withdraw the exemption granted on the sale of buses for assessment year 1983-84. (ii) Whether the sale of old buses was a separate taxable commodity under entry 3 of the First Schedule, so that the claim of second-sale exemption could not be allowed merely because tax had already been paid on the chassis and bus bodies.

Issue (i): Whether the Deputy Commercial Tax Officer was competent under section 16(1) to revise the earlier assessment and withdraw the exemption granted on the sale of buses for assessment year 1983-84.

Analysis: Section 16(1) of the Tamil Nadu General Sales Tax Act, 1959 empowers the assessing authority having jurisdiction to reopen escaped turnover and reassess within the prescribed period. The revision was made by the authority having jurisdiction over the assessee at the relevant time. The earlier grant of exemption by a different officer did not bar reassessment, and the limitation placed by cases concerning Enforcement Wing officers did not control the competence of the regular assessing authority in the assessment wing.

Conclusion: The reassessment under section 16(1) was valid and the Deputy Commercial Tax Officer was competent to withdraw the exemption.

Issue (ii): Whether the sale of old buses was a separate taxable commodity under entry 3 of the First Schedule, so that the claim of second-sale exemption could not be allowed merely because tax had already been paid on the chassis and bus bodies.

Analysis: Entry 3 of the First Schedule treats buses, chassis, and bodies built on chassis as distinct items for tax purposes. A complete bus sold as such is commercially different from its constituent chassis and body components. The fact that tax had been paid on the components did not mean that the sale of the assembled bus was exempt as a second sale. The authorities therefore correctly treated the bus as a distinct assessable commodity and levied tax at the applicable single point rate.

Conclusion: The sale of old buses was rightly taxed as a separate commercial commodity and the second-sale exemption was not available.

Final Conclusion: The tax revision cases failed, and the assessment orders and appellate orders sustaining the levy on the sale of old buses were upheld.

Ratio Decidendi: Where the statute treats a complete bus as an assessable commodity distinct from its chassis and body, and the assessing authority has jurisdiction under section 16(1) to reopen escaped turnover, reassessment withdrawing an earlier exemption is valid and the sale remains taxable as a separate first sale.

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