MANJI BHIMJI PARMAR Vs. ASSISTANT SALES TAX OFFICER

JUDGEMENT

(1.) THIS is a petition by Messrs Manji Bhimji, railway contractors. Under a contract with the railway they constructed two bridges in Madhya Pradesh. Subsequently they were served with a notice on 27th July, 1966, as to why they should not be assessed to purchase tax under Section 7 of the M. P. General Sales Tax Act. The notice had been given by the Assistant Sales Tax Officer, Rewa. After hearing the petitioner the same officer assessed purchase tax on a turnover of Rs. 5,10,000 after allowing a deduction of Rs. 40,000. The total tax assessed was Rs. 26,200. This petition has been filed against that demand and the point stressed by the learned counsel for the applicant is that the Assistant Sales Tax Officer had no jurisdiction to assess purchase tax. The power to assess tax under the Act is given to the Commissioner (section 30) and he has authority to delegate the same to his subordinates. Under Rule 68 of the M. P. General Sales Tax Rules the Commissioner is authorized to delegate certain powers of assessment according to the table mentioned in the rule. Reliance is placed by the learned counsel for the State on entry No. 7 (c) in that table. In the second column of entry No. 7 the sections under which the powers have been delegated are mentioned as Sections 18, 19 and 22. The power which has been delegated is mentioned in column 3, the relevant part of which is as follows:

(2.) LEARNED counsel appearing for the State contended that so long as a dealer does not have a turnover of more than Rs. 4 lakhs, he is amenable to the jurisdiction of the Assistant Sales Tax Officer even though he has no turnover at all. In that case also he would have a turnover of less than Rs. 4 lakhs and would be amenable to the jurisdiction of the Assistant Sales Tax Officer. We are unable to agree with the learned counsel. The power of assessment is mainly given to the Commissioner of Sales Tax and the Assistant Sales Tax Officer can exercise only those powers which are expressly delegated to him. By the entry mentioned above he has been delegated the power to assess dealers who have a turnover of less than Rs. 4 lakhs. They must have a turnover before they can be amenable to the jurisdiction of the Assistant Sales Tax Officer. A dealer who has no turnover at all cannot be said to be a dealer having a turnover of less than Rs. 4 lakhs.

(3.) THIS conclusion is also reached if we look at the matter from another point of view. This power is given to the officer occupying the lowest rung in the hierarchy of officers authorized to make assessment and his jurisdiction has been confined to a turnover of less than Rs. 4 lakhs. If the interpretation contended for by the learned counsel for the State is accepted, the result would be that in the case of assessment of purchase tax, he would have no pecuniary limit to which he can assess. Not only that officers of a higher rank covered by entry 7 (b) who are to deal with dealers having a turnover of more than Rs. 4 lakhs but less than Rs. 30 lakhs will have no jurisdiction at all to assess any purchase tax, and the Commissioner with whom the residuary power rests and who can assess every dealer other than those mentioned in Clauses (b) and (c) of entry 7 would also be confined to exercise jurisdiction only in respect of dealers who have a turnover of more than Rs. 30 lakhs. We are unable to read these entries in that light. We think the intention of Rule 68 is to give power to assess turnover in cases of certain classes of dealers to Sales Tax Officers under Clause (b) and to Assistant Sales Tax Officers under Clause (c) and that all the residuary powers of assessment of purchase tax and in case of dealers of other classes not covered by Clauses (b) and (c) will remain undelegated with the Commissioner himself.