Rectification for mistake apparent from record upheld where Supreme Court rulings fixed the sales tax incentive cut-off date.

A reassessment was held valid where earlier sales tax incentive assessments had become inconsistent with binding Supreme Court judgments fixing the incentive cut-off at 4 April 1994. The High Court applied section 37 of the Rajasthan Sales Tax Act, 1994, which treats an order as containing a mistake apparent from the record when it is rendered invalid by a Supreme Court decision. On that basis, the assessing officer was competent to rectify the assessments and withdraw the benefit wrongly allowed for later years. The Tax Board and the Deputy Commissioner (Appeals) were found to have erred by ignoring the settled legal position.

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Issues: Whether the assessing officer could rectify the assessment under section 37 of the Rajasthan Sales Tax Act, 1994 on the basis of the Supreme Court judgments limiting the sales tax incentive benefit to 4 April 1994.

Analysis: The Court held that the later Supreme Court decisions had authoritatively settled the law that the incentive benefit under the scheme could be retained only up to 4 April 1994 and not beyond that date. It further noted that section 37 expressly treats an order as involving a mistake apparent from the record when it becomes invalid because of a Supreme Court judgment. In that view, the assessing officer was competent to rectify the earlier assessments and withdraw the benefit wrongly extended for the later assessment years. The Court also held that the Tax Board and the Deputy Commissioner (Appeals) erred in ignoring the settled legal position.

Conclusion: The rectification was valid and the assessing officer's order was in law, while the contrary orders of the Tax Board and the Deputy Commissioner (Appeals) were unsustainable.

Ratio Decidendi: An assessment order becomes rectifiable as a mistake apparent from the record when it is rendered inconsistent with a binding Supreme Court judgment, and a statutory incentive benefit cannot be extended beyond the cut-off date fixed by that judgment.

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