LAXMI AGARBATTI FACTORY Vs. UNION OF INDIA

JUDGEMENT

(1.) PETITIONER is a partnership-firm carrying on the business of manufacture and sale of agarbatti at Sagar and is registered as a dealer under the M. P. General Sales Tax Act, 1958 and the Central Sales Tax Act, 1956 (for short, "the Act" ). The petition relates to various periods of assessment from January 1, 1982 to December 31, 1984. Fourth respondent issued notices to the petitioner under section 19 (1) of the former Act read with section 9 of the latter Act proposing to reassess the petitioner for the aforesaid periods on the ground that there was under-assessment. Petitioner has filed the writ petition challenging the constitutionality of the third proviso to rule 12 (1) of the Central Sales Tax (Registration and Turnover) Rules, 1957 (for short, "the Rules") and seeking to quash the notices. The provision is challenged as beyond the rule-making power of the Central Government under section 13 of the Central Act and arbitrary.

(2.) PETITIONER obtained "c" forms from the purchasing dealers to avail of concessional rate of tax and produced the same before the assessing officer who accepted the same and allowed the concessional rate of tax. Subsequently, the auditor of the department found that the "c" forms were not according to the financial year, but according to the calendar year which was adopted by the petitioner as the accounting year.

(3.) THE third proviso originally contained the word "year" which, by 1975 Amending Rules, was substituted by the expression "financial year". "year" would mean the accounting year followed by the assessee according to the definition in the State Act and the Central Act. Section 2 (u) of the State Act defines "year" as financial year or accounting year chosen by the assessee. The Central Act refer to the word "year" as the year applicable to the assessee under the State law and where there is no such year applicable, the financial year.