DY COMMR OF SALES TAX Vs. SUBBHALAKSHMI AMMAL

JUDGEMENT

(1.) This revision petition has been filed by the Deputy Commissioner of Sales Tax (Law), Ernakulam against the decision of the Kerala Sales Tax Appellate Tribunal, Kozhikode in Tribunal Appeal No. 833/70.

(2.) One Sri P. S. Vaidyanatha Iyer was conducting a refreshment stall at Tirur railway station. For the year 1966-67 he was assessed under S.17(3) of the Kerala General Sales Tax Act 1963 hereinafter called the Act on a taxable turnover of Rs. 26,138.00 determined by the assessing authority to the best of its judgment. In making the said assessment the assessing authority had denied to the assessee the benefit of payment of tax at the compounded rates provided for by S.7 of the Act on the ground that the assessee had failed to put in the necessary application under sub-s.(2) of that section read with R.30 of the Kerala General Sales Tax Rules despite his having been afforded an opportunity to do so. The assessment was accordingly completed by levying tax at the rates specified under sub-s.(1) of S.5 of the Act.

(3.) The assessee preferred an appeal before the Appellate Assistant Commissioner of Sales Tax, Calicut. In that appeal he contended not merely that the quantification of the taxable turnover had been effected arbitrarily and unjustly but also that he ought to have been granted by the assessing authority the benefit of payment of tax at compounded rates under S.7 of the Act. inasmuch as he had made out sufficient cause for his failure to file the application seeking the benefit within the prescribed period under R.30. The Appellate Assistant Commissioner by his order dated 12-6-70 revised the taxable turnover of the appellant (assessee) by upholding some of the contentions put forward by the assessee and also found that the assessee had made out sufficient reason for not submitting the application in Form No. 21 seeking the benefit of composition of tax under S.7 within the prescribed period. While modifying the assessment in the manner indicated in his order the Appellate Assistant Commissioner gave a direction to the assessing authority that if the assessee submitted an application in Form No. 21 within 10 days of the receipt of the appellate order in the office of the assessing authority, the assessee should be given the benefit of payment of tax at compounded rate under S.7 of the Act. The Department took up the matter in second appeal before the Tribunal objecting to the modification of the assessment effected by the Appellate Assistant Commissioner in the assessment made by the Sales Tax Officer and contending also that the Appellate Assistant Commissioner had acted illegally and without jurisdiction in directing the assessing authority to extend the benefit of S.7 of the Act to the assessee, in case the assessee filed an application in Form No. 21 within 7 days of the receipt of the appellate order. The Tribunal found that the modification effected in the assessment by the first Appellate Authority was fully justified It also held that the powers conferred on the Appellate Assistant Commissioner under S.34 of the Act were wide enough to include the power to examine the legality and propriety of the action of the Sales Tax Officer in denying to the assessee the benefit of S.7 to issue appropriate consequential directions to the Sales lax Officer. The second appeal filed by the Revenue was accordingly dismissed by the Tribunal.