TaxTMI 
TaxTMI 
2016 (3) TMI 1032
X X X X Extracts X X X X
X X X X Extracts X X X X
.... years 1995-96, 1997-98 and 1998-99, under section 12(4) of the Act and for the year 1996-97 under section 12(8) of the Act. Subsequently, in 2000, Assistant Officer of A.G. Audit party made audit of the turn over of the opposite party for these period. During audit, they found that the opposite party has suppressed the sales and accordingly, found taxable purchase to the tune of Rs. 56,37,965.00 on the strength of Form XXXIV and Rs. 56,859.00 on the strength of way bills, in total, amounting to Rs. 56,94,824.00 for those years. But the audit found that the taxable turn over against those years have been suppressed by the opposite party and claimed much more value of goods in comparison to less purchase of first point tax paid goods as well as non-disclosure of taxable purchase of annual stock account of opening and closing balance of stock. Thus he found that Rs. 16,34,522.00 was escaped from assessment during those years resulting in Rs. 6,11,131.00 short levy of tax including surcharge. The Auditor also found for the years 1993-94 and 1994-95 there was similar suppression of tax of Rs. 1,48,141.00 including surcharge. After receiving the audit report, the learned Assessing Autho....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the Act for the assessment of the escaped sales tax without assigning any reason in such assessment, is unlawful. Learned Tribunal found that the conclusion reached by the authorities below are not based on any material before them. Since there is no material showing suppression of tax turn over, the conclusion arrived at by the authorities below, is bad in law and accordingly the Tribunal set aside the orders of the First Appellate Authority as well as the Assessing Authority and allowed the appeal. Hence the revision. 5. The case of the opposite party is that the opposite party submitted self-assessed return under section 12(4) of the Act and the same has been already assessed by the concerned authority. Accordingly it has already paid the tax. It is the further case of the opposite party that without affording reasonable opportunity, there is re-assessment of its tax turn over, resulting in sheer harassment to it. Opposite Party denies about any suppression of tax turn over and claimed that the audit assessment is based on no evidence and the learned authorities below the learned Tribunal have not appreciated the true facts of the case. The Opposite Party hailed the judgmen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....those four years by the learned Assessing Authority. It is further found that vide Annexure-4, opposite party has filed reply to the show-cause notice issued under section 12(8) of the Act and in that show-cause he has averred that it has averred that it is maintaining the stock to the tune of Rs. 35-40 lakh out of which luggages cover 60%, 20% is covered by the tax paid items and the rest are covered by other first point items which include glass and crockery. He fairly stated not to have suppressed any sale. The Assessing Authority vide Annexure-7 indicated that there was re-assessment on 17.8.2001 and it is found that tax of Rs. 1,53,170.00 is payable by the opposite party for the assessment year 1997-98. This order does not disclose the discussion on the plea taken by the opposite party. Vide order dated 21.3.2002 (Annexure-8), the First Appellate Authority simply observed that opportunity was given to the opposite party to adduce evidence and the order dated 17.8.2001 of the Assessing Authority basing on the report of the Income Tax Department as to stock position in the establishment of the opposite party is correct and is an independent enquiry. When the Assessing Authority ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n sub-section(5) of this Section and may also direct, in cases where such escapement or under assessment or composition is due to the dealer having concealed particulars of his turnover or having without sufficient cause has furnished incorrect particulars thereof, that the dealer shall pay, by way of penalty, in addition to the tax assessed under this sub-section, a sum equal to one and a half times of the said tax so assessed." 10. From the aforesaid provision it is clear that if for any reason the turnover of a dealer for any period to which this Act applies has escaped assessment or has been under assessed or where tax has been compounded when composition is not permissible under this Act and the Rules made thereunder the Commissioner may at any time within five years from the expiry of the year to which that period relates call for return under subsection( 1) of Section 11 and may proceed to assess the amount of tax due from the dealer in the manner laid down in sub-section(5) of Section 12 of the Act. It is imperative to go through the sub-section (5) of Section 12 of the Act which is reproduced below : "12 (5): If upon information which has come to his possession, the Com....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Premchandra v. Commercial Tax Officer, Calcutta and another, (1958) 9 STC 428 (SC) their Lordships at page 435 observed : "We are really surprised at the manner in which the first respondent dealt with the matter of this assessment. It is clear that he did not exercise his own judgment in the matter and faithfully followed the instructions conveyed to him by the Assistant Commissioner (C.S.) without giving the appellants an opportunity to meet the points urged against them. The whole procedure was contrary to the principles of natural justice. The procedure adopted was, to say the least, unfair and was calculated to undermine the confidence of the public in the impartial and fair administration of the salestax department concerned." From the aforesaid proposition, it is clear that if the Assessing Authority who is vested with power to exercise but does not execute according to statute, the procedure followed by the concerned authority is contrary to principle of natural justice. 13. The aforesaid principle has also been followed in Orient Paper Mills Ltd. v. Union of India, AIR 1969 SC 48 where their Lordships observed : It is regrettable that when administrative officers are ....