Escaped-assessment time limit under sales tax rules applies to initiation, not final order, under Rule 33.

Rule 33 of the Travancore-Cochin General Sales Tax Rules, 1950 was construed as governing the entire escaped-assessment process, not merely the issue of notice. The assessment proceeding was treated as continuing from initiation until the final order, and the wording requiring determination of escaped turnover within three years next succeeding the relevant year was read as a limit on the assessment itself. On that interpretation, proceedings were not time-barred where they were initiated within three years even if the final assessment order was passed later. The interpretation favoured the Revenue.

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Issues: Whether, under Rule 33 of the Travancore Cochin General Sales Tax Rules, 1950, escaped-assessment proceedings had to be completed within three years of the relevant year, or whether it was sufficient that they were initiated within that period.

Analysis: Rule 33 empowered the assessing authority to determine escaped turnover and assess the tax payable at any time within three years next succeeding the year to which the tax related. The expression used in the rule was read in the context of sales tax legislation as governing the whole assessment process, not merely the issuance of notice. The assessment proceeding was treated as pending from initiation until final order, and the words following the power to determine escaped turnover made it clear that the assessment itself had to be made within the prescribed period. The Court rejected the contention that the use of the word "determine" required a different result from provisions using the phrase "proceed to assess".

Conclusion: Proceedings under Rule 33 were valid if initiated within three years, and they did not become time-barred merely because the final assessment order was made after the expiry of that period. The decision was in favour of the Revenue.

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