R.C. INDIA Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) THESE three appeals under Section 66(1) of the Karnataka Value Added Tax Act, 2003 (hereinafter referred to as "the Act", for short) are by a dealer/partnership firm, which had not bothered to get itself registered under the provisions of the Act, notwithstanding a statutory requirement to this effect under Section 22 of the Act and because of which reason, it appears, the Deputy Commissioner of Commercial Taxes (Audit) -35, DVO -3, 7th Floor, VTK -1 Gandhinagar, Bangalore, to be precise, took a chance to pass a best judgment assessment order in respect of the appellant for the periods April, May and June of 2005 determining the tax liability of the appellant for these periods, in terms of the order dated March 29, 2008.

(2.) THE appellant, being aggrieved by this order, had preferred a first appeal under Section 62 of the Act to the Joint Commissioner of Commercial Taxes (Appeals) I, Bangalore, and met with success as the Joint Commissioner opined that the officer who had passed the best judgment assessment order in terms of Sub -section (7) of Section 38 was not competent to do so having not been authorized by the Commissioner of Commercial Taxes for performing this duty as is required in terms of the very statutory provision as indicated in his order at paragraph 6 which reads as follows: On perusal of the records, it is noticed that the field -audit was taken up in view of the assignment issued by the J.C.C.T. (Admn.), D.V.O. 3, Bangalore. The records do not reveal that the assignment so issued was authorized by the Commissioner of Commercial Taxes. The empowering Section 38(7) is very clear that orders under Section 38(7) is to be passed by the authorities if they are authorized by the Commissioner. In the absence of authorization of the competent authority, the impugned order would be an improper order.

(3.) THE Additional Commissioner of Commercial Taxes, exercising revisional power under Section 64 of the Act, being of the opinion that the order passed by the first appellate authority is not only erroneous, but also prejudicial to the interest of the Revenue, interfered with the matter, set aside the order passed by the Joint Commissioner and restored the order passed by the original authority under the provisions of Section 38(7) of the Act.