Suo motu revisional power under tax law upheld, but fairness required a fresh hearing on the merits.

Section 46(4) of the Bihar Finance Act, 1981 conferred an independent suo motu revisional power on the Commissioner, and delegation to the Joint Commissioner did not convert the proceeding into an application-based revision; the power was therefore validly exercised. Because the statute prescribed no express limitation period, Article 137 of the Limitation Act, 1963 was not imported, although the power still had to be exercised within a reasonable time; invocation after about three years was not treated as unreasonable. The revisional order setting aside the revised assessment orders was nevertheless unsustainable on fairness grounds, as the assessee had been materially handicapped and the matter was remitted for fresh hearing and reconsideration on the merits.

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Issues: (i) Whether the suo motu revisional power under Section 46(4) of the Bihar Finance Act, 1981 was validly exercised; (ii) Whether the suo motu action was barred by limitation or could be invalidated for delay; (iii) Whether the Joint Commissioner's order setting aside the revised assessment orders could be sustained.

Issue (i): Whether the suo motu revisional power under Section 46(4) of the Bihar Finance Act, 1981 was validly exercised.

Analysis: The provision conferred an independent suo motu power on the Commissioner, and that power had been delegated to the Joint Commissioner. The notice issued by the Joint Commissioner disclosed his own satisfaction on the legality and propriety of the revised assessment orders. The materials supplied by the Deputy Commissioner were treated only as background information and did not convert the proceeding into an application-based revision by an aggrieved party.

Conclusion: The suo motu revisional power was validly exercised.

Issue (ii): Whether the suo motu action was barred by limitation or could be invalidated for delay.

Analysis: No express period of limitation was prescribed for suo motu revision under Section 46(4). Article 137 of the Limitation Act, 1963 was not applicable to read such a limitation into the statute. At the same time, the power could not be exercised arbitrarily after an indefinite lapse of time and had to be invoked within a reasonable period, the content of which depended on the facts of each case. On the facts, exercise of the power after about three years was held not to be unreasonable.

Conclusion: The action was not barred by limitation and was exercised within a reasonable time.

Issue (iii): Whether the Joint Commissioner's order setting aside the revised assessment orders could be sustained.

Analysis: The order was passed while the writ proceedings were pending, and the assessee had been materially handicapped in contesting the matter before the Joint Commissioner. In those circumstances, fairness required that the parties be heard afresh and the legality and propriety of the revised assessment orders be reconsidered.

Conclusion: The order could not be sustained and was set aside, with the matter remitted for fresh decision.

Final Conclusion: The suo motu revisional jurisdiction was upheld, the limitation challenge failed, and the revisional order was set aside only to enable a fresh hearing on the merits.

Ratio Decidendi: Where a statute confers suo motu revisional power without prescribing a limitation period, courts will not import Article 137 of the Limitation Act, 1963, but the power must still be exercised within a reasonable period on the facts of the case.

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