GYAN CYCLE STORES Vs. SALES TAX OFFICER SATNA

JUDGEMENT

(1.) IN this petition under article 226 of the Constitution the petitioner has challenged the ex parte orders of assessment dated July 22, 1985 (annexures E1 and E2) passed by respondent No. 1 as well as the revisional order dated January 11, 1988 (annexure H) passed by respondent No. 2, the Divisional Deputy Commissioner, Sales Tax, Satna and the penalty imposed on the petitioner under section 43 (1) of the M. P. General Sales Tax Act, 1958 (hereinafter referred to as "the Act" ).

(2.) THE petitioner is a registered dealer under the Act and holds a registration certificate. He is carrying on the business of cycle and their spare parts in wholesale as well as retail. Respondent No. 1 initiated assessment proceedings against the petitioner for the two periods, that is to say, November 8, 1980 to October 26, 1981 and October 28, 1981 to November 15, 1982 (hereinafter referred to as the first and second periods), respectively. During the search made on July 8, 1982, of the business premises of the petitioner, some loose papers were found for which the petitioner was required to submit his explanation. The petitioner submitted his explanation but it was rejected and the Flying Squad proposal concealment of Rs. 1,000 in the first period and Rs. 15,000 in the second period. Respondent No. 1 estimated the turnover of the petitioner's business for two periods by enhancing the same by Rs. 10,000 in the first period and Rs. 1,00,000 (one lac) in the second period. The petitioner was not satisfied by the said assessment and, therefore, challenged the same before the Deputy Commissioner, Sales Tax, Satna, in appeal. The Deputy Commissioner remanded the case with the direction for fresh assessment. After remand, respondent No. 1 proceeded with the assessment proceedings again and as the petitioner did not appear on the date of hearing, he made an ex parte assessment by his impugned orders annexures E1 and E2. The petitioner again challenged the said assessment orders in revision before respondent No. 2 who dismissed the same by consolidated order dated January 11, 1988 (annexure H ). The aforesaid orders passed by respondent Nos. 1 and 2 are challenged in this petition.

(3.) LEARNED counsel for the petitioner next contended that the rat of tax payable on cycles was fixed at 6 per cent by Notification No. A3-33-80 (23) ST-V, dated August 30, 1980, yet the respondents levied the tax on the petitioner at the rate of 8 per cent which is illegal. A copy of the notification was produced before us during the course of argument from which it is apparent that rate of tax on cycle at the relevant time was 6 per cent and not 8 per cent, at which the petitioner has been charged. This apart, the respondents in reply to ground No. VII, have admitted in their return that rate of sales tax on sales of cycles was reduced from 8 per cent to 6 per cent by the notification referred to above. That being so, the respondents were absolutely incorrect and unjustified in subjecting the petitioner to the tax at the rate of 8 per cent. The respondents should have levied sales tax at the rate of 6 per cent.