M V NARASAPPA Vs. COMMERCIAL TAX OFFICER KOLAR

JUDGEMENT

(1.) The appellant, a member of the joint Hindu family M. Venkatarayappa and Sons hereinafter referred to as the assessee, filed 'quarterly returns of its business turnover for the year April 1, 1955, to march 31, 1956. The Commercial Tax Officer, Kolar, estimated the turn- over at Rs. 2,20,000 and levied a tax of Rs. 2,525. The assessee appealed to the Deputy Commissioner of Commercial Taxes, Bangalore Division, and filed a statement of purchases of groundnuts before the Deputy commissioner. The Deputy Commissioner- remanded the case with the following observations : "the order of the assessing officer does not indicate if this statement filed by the assessee is correct and he does not seem to have examined the accounts produced by the assessee. With a view to know the correct accounts, it is necessary to go into the accounts of the assessee once again to fix up the correct turnover. Under these circumstances, I find the assessing officer has not made proper enquiry or scrutiny of accounts or estimated the turnover properly. I, therefore, remand the case to the assessing officer with a direction that he should properly scrutinise the accounts and if the accounts are not maintained correctly, then he will estimate to the best of judgment after giving sufficient material. "

(2.) On October 19, 1958, the Commercial Tax Officer, Kolar Circle, Kolar, estimated the total taxable turnover at Rs. 2,00,000 and assessed the tax at Rs. 2,212-8-0. Thereupon the assessee filed a revision petition and the main contention of the assessee before the Deputy Commissioner of commercial Taxes was that the last date for passing the assessment order for the year 1955-56 under the Mysore Sales Tax Act, 1948, was March 31, 1958, and the Commercial Tax Officer could not be exonerated from the application of the time-limit prescribed in the Act merely because the impugned assessment order had been passed in pursuance of a direction given by the appellate authority.

(3.) The Deputy Commissioner rejected this contention. The assessee thereupon filed a revision before the Commissioner of Commercial Taxes. Before the Commissioner reliance was placed on a decision of the Mysore High Court in C. R. P. 666 of 1959 according to which the impugned assessment in the case had to be struck down as barred by limitation. The Commissioner, however, relying on sections 4 and 6 of the Mysore Sales Tax (Amendment) Act, 1962, retrospectively amending section 40 of the Mysore Sales Tax Act, 1957, held on October 22, 1962, that the assessment was not barred by limitation. He, however, found that the Commercial Tax Officer had not given a notice in writing to the assessee how and why he was not satisfied with the correctness of the accounts and the basis on which he proposed to make the assessment. The Commissioner accordingly set aside the assessment and remanded the case once again to the Commercial Tax Officer to follow the procedure for making the best judgment assessments and pass fresh orders according to law.