R R KASHAPPANAVAR Vs. STATE OF MYSORE

JUDGEMENT

(1.) This is an appeal by a dealer under section 24(1) of the Mysore Sales Tax Act, 1957, hereinafter called the Act, against the order of the Commissioner of Commercial Taxes in Mysore made in Case No. S.M.R. 2/71-72 dated 4th March, 1972, by which the Commissioner in exercise of his suo motu powers of revision under section 22-A of the Act set aside the orders of the Deputy Commissioner of Commercial Taxes made in appeal and also the order of assessment made by the Commercial Tax Officer, Haveri.

(2.) For the period from 3rd November, 1967, to 21st October, 1968, the dealer submitted a return of turnover of Rs. 89,886.04. The Commercial Tax Officer, Haveri, who was the assessing authority, did not accept the turnover returned and he made an order of assessment on best of judgment basis determining the turnover at Rs. 2,36,500. The business of the dealer was that of a manufacturer of beaten rice by pounding paddy for which he consumed electricity. The Commercial Tax Officer determined the turnover on a comparison of the turnovers determined in the previous years and the relative increase in the consumption of electricity during the relevant year. The assessee aggrieved by the said order preferred an appeal before the Deputy Commissioner of Commercial Taxes, Belgaum Division, who, being of the opinion that it would be reasonable to estimate the turnover of the dealer by the addition of Rs. 10,000 to the declared turnover, reduced the turnover to Rs. 99,886.04.

(3.) The Commissioner of Commercial Taxes in exercise of his suo motu powers of revision under section 22-A of the Act, issued a show cause notice dated 20th July, 1971, proposing to set aside the final assessment order passed by the Commercial Tax Officer, Haveri, as also the appellate order passed by the Deputy Commissioner of Commercial Taxes dated 8th July, 1970, thereon. In the said notice, the Commissioner stated that "on going through the assessment records and on ascertaining the electrical energy consumed and the probable yield of poha (beaten rice) from the quantity of paddy which would require the amount of electricity consumed, the average sale price of poha during the relevant period ad such other relevant factors, it was found that proper investigation had not been made by the authorities below and that the turnover has been fixed in an arbitrary way at a figure very much lower than the turnover that ought to have been fixed". The said notice further stated that a turnover of Rs. 13,00,000 has not been taken into consideration by the lower authorities due to faulty investigation. The dealer filed his objections to the proposed revision. After hearing the counsel for the dealer, the Commissioner made the order under appeal after rejecting all the contentions urged on behalf of the dealer. After setting aside the orders of the authorities below, the Commissioner remanded the case to the Commercial Tax Officer to make a fresh order of assessment after investigation on the lines indicated in the said order.