GANGADHAR RAMCHAND OIL MILLS Vs. SALES TAX OFFICER

JUDGEMENT

(1.) By this petition under Article 226 of the Constitution the petitioner impugns the validity of the proceedings for recovery of a sum of 2,26,500 which has been assessed as sales tax due from the petitioner for the first quarter of the assessment year 1970-71.

(2.) The petitioner, M/s. Gangadhar Ramchand, is a dealer registered under the U. P. Sales Tax Act, 1948. It did not file the return of its turnover for the first quarter of the assessment year 1970-71 (ending 30th June, 1970). On 14th September, 1970, the Sales Tax Officer, Agra, acting under Rule 41(3) of the Rules framed under the U. P. Sales Tax Act, passed two provisional assessment orders (one under the U. P. Sales Tax Act and the other under the Central Sales Tax Act), creating tax liability amounting to Rs. 2,52,500 (Rs. 2,02,600 under the U. P. Sales Tax Act and Rs. 50,000 under the Central Sales Tax Act) against the petitioner. Eventually, in revision the tax liability of the petitioner for the first quarter of the year 1970-71 was reduced to Rs. 2,36,450 (1,92,000 under the U. P. Sales Tax Act and Rs. 44,450 under the Central Sales. Tax Act). It appears that prior to the order passed in revision, the Sales Tax Officer initiated proceedings for final assessment of the sales tax dues from the petitioner for the year 1971 under Rule 41(5) of the Rules framed under the U. P. Sales Tax Act. However, due to certain reasons the proceedings for final assessment for the year 1970-71 under Rule 41(5) have remained stayed so far. In the month of June, 1976, the Sales Tax Officer initiated proceedings for recovering a sum of Rs. 2,26,500, the amount of sales tax for the first quarter of the year 1970-71, assessed against the petitioner. On 7th June, 1976, the petitioner made an application objecting to the recovery of the said amount. The Sales Tax Officer, vide his order dated 7th June, 1976, rejected the objection and declined to withdraw the recovery proceedings. Aggrieved, the petitioner has come up before this Court.

(3.) The learned counsel appearing for the petitioner contends that a provisional assessment order made under Rule 41(3) of the Rules framed under the U. P. Sales Tax Act ceases to be operative at the close of the assessment year in respect of which the order was made. In any case, it ceases to be effective when the proceedings under Rule 41(5) for regular assessment for the year in question are initiated. Accordingly, no proceedings for realisation of the amount provisionally assessed can be taken after the year in question is over and in any case it cannot be taken after the proceedings for the regular assessment in respect of the relevant year have been initiated.