HANDUM IRON & STEEL ENTERPRISES (P) LTD. Vs. COMMISSIONER OF COMMERCIAL TAXES, ANDHRA PRADESH, HYDERABAD

JUDGEMENT

(1.) THIS special appeal by the appellant/asses -see under section 23(1) of the Andhra Pradesh General Sales Tax Act, 1957 read with rule 41 of the Rules under the said Act is directed against the orders dated February 29, 2000 of the Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad passed in CCT's. Ref. No. L.III(2)/1965/97. We have heard the submissions of the learned counsel for the appellant and the learned Special Government Pleader for Taxes. We have perused the material record.

(2.) THE facts, in brief, are as follows: "The appellant, who is the registered dealer, was engaged in the manufacture of rerolled products of iron and steel. During the course of the trade, the appellant had purchased various raw materials and consumables for the purpose of manufacture of the said finished goods. The appellant was assessed by the Commercial Tax Officer ("the CTO", for short) for the assessment year 1992 -93 under the APGST Act vide order dated March 24, 1994. According to the appellant, they being the steel re -rollers, are eligible for set -off of tax paid on raw materials from the tax payable on the finished product as per the terms of the G.O. Ms. No. 763 Revenue (CT -II) Department, dated August 21, 1990. The Deputy Commissioner, who had examined the assessment record of the CTO was of the view that the assessing authority had acted in a manner prejudicial to the interests of the Revenue of the State and had, therefore, proposed to restrict the set -off of tax by withdrawing the excess set -off of Rs. 4,73,946. Accordingly, a show -cause notice was issued by the Deputy Commissioner; and, finally the Deputy Commissioner by his order dated March 7, 1996 had allowed a set -off of Rs. 58,92,050 as against the set -off of Rs. 61,39,374 granted by the CTO. The Commissioner having examined the said revision order of the Deputy Commissioner with reference to the records had found that the order of the Deputy Commissioner is incorrect and is prejudicial to the interests of the Revenue of the State and had, therefore/issued a show -cause notice proposing to revise the order of the Deputy Commissioner. However, when it was brought to the notice of the Commissioner that the order of the Deputy Commissioner was assailed in appeal in T.A. No. 794 of 1997 before the Sales Tax Appellate Tribunal and that the said appeal is pending that part of the revision proposed, was dropped by the Commissioner. However, the Commissioner proposed to bring to tax under section 6A of the Act certain turnovers in the show -cause notice, namely, turnover of Rs. 1,85,845 relating to purchase of fuel; turnover of Rs. 16,46,574 relating to purchase of coal; and, turnover of Rs. 13,33,578 relating to purchase value of miscellaneous goods. The appellant had contended, inter alia, that the Commissioner cannot raise a fresh issue while revising the order of the lower authority and that the same would amount to revising the assessment order dated March 24, 1994 of the CTO and therefore, the revision insofar as it related to this fresh issue is bad in law and is also barred by law of limitation. The proposed revision related to turnovers which were proposed to tax under section 6A of the Act was also contested on merits stating that the proposed turnovers are not assessable to tax as the purchases were made from registered dealers within the State and that the relevant purchase bills were placed before the CTO and the same also would be placed before the Deputy Commissioner if need be. The Commissioner thus having dropped the part of the proposed revision insofar as it related to the first issue aforementioned had brought the turnovers of fuel, coal and miscellaneous goods to tax and had subjected the same to tax at the applicable rates under section 6A of the Act for the year 1992 -93. Therefore, the aggrieved appellant/assessee is before this court."

(3.) THE learned counsel for the appellant would contend as follows: