IMPORTEX INTERNATIONAL P LTD Vs. STATE OF KERALA

JUDGEMENT

(1.) THE same assessee is the revision-petitioner in both the cases. THE assessee is a private limited company. It is a dealer in Nylon Fish net fabrics. THE turnover relating thereto was assessed, for the assessment years 1982-83 and 1983-84, at the general rate, negativing the plea of the assessee, that Nylon Fish nets sold will fall under Entry 7 of the III Schedule to the K. G. S. T. Act, 1963. THE first appellate authority affirmed the said decision. Before the Appellate Tribunal, the assessee raised a plea based on the clarification issued by the Government of Kerala, vide G. O. (P) 162/88/td dated 25-11-1988. THE said Government proceeding was one rendered in exercise of the powers conferred under S. 59a of the K. G. S. T Act. THE Appellate Tribunal held, that what was sold by the assessee/ dealer was Nylon Fish net in weight and so it will not be eligible for exemption as per the above Government proceedings. THE assessee has come up in revisions.

(2.) WE heard counsel for the assessee, Mr. Jose Joseph, as also counsel for the Revenue, Senior Government Pleader Mr. N. N. Divakaran pillai. WE are concerned with the assessment years 1982-83 and 1983-84. During the course of hearing, we were informed that the assessments for the above two years (1982-83 and 1983-84) are sought to be re-opened, by issuing notices under S. 19 (1) of the K. G. S. T. Act. The assessee has challenged the said proceedings in O. P. No. 2719 of 1986. The notices issued under S. 19 (1) of the act, for the assessment years 1982-83 and 1983-84, are Exts. P5 and P6 in the said case.

(3.) IN Deputy Commissioner of Commercial Taxes v. H. R. Sri ramulu (39 S. T. C. 177), delivering the judgment of the Supreme Court, Khanna, j. stated the law thus, at page 180: "once an assessment is reopened, the initial order for assessment ceases to be operative. The effect of reopening the assessment is to vacate or set aside the initial order for assessment and to substitute in its place the order made on reassessment. The initial order for reassessment cannot be said to survive, even partially, although the justification for reassessment arises because of turnover escaping assessment in a limited field or only with respect to a part of the matter covered by the initial assessment order. The result of re-opening the assessment is that a fresh order for reassessment would have to be made including for those matters in respect of which there is no allegation of the turnover escaping assessment. " The decisions of the Supreme Court were reviewed by a bench of this Court in C. I. T. v. Kesava Reddiar (1989 (1) K. L. T. 492 ). One of us was a party to the said decision. The Court held as follows: "the effect of reopening the assessment is to vacate or set aside the intitial order of assessment and substitute in its place the order made in reassessment proceedings. The initial order of assessment cannot survive to any manner or to any extent. The result of reopening the assessment is that a fresh order of assessment should be made. It was so done in this case by the revised proceedings, dated 31-10-1980. The above legal position is settled in view of the decisions of the Supreme Court in Commissioner of Sales tax v. H. M. Esufali H. M. Abdulali (90itr 271) and Deputy Commissioner of commercial Taxes v. H. R. Sri Ramulu (39 STC 177)"