MAHARANA AND MAHARANA Vs. STATE OF ORISSA

JUDGEMENT

(1.) THIS is an application under section 24(2)(b) of the Orissa Sales Tax, 1947 (hereinafter referred to as "the Act") by the assessee to call for a statement of the case from the Sales Tax Tribunal alleging that refusal by Sales Tax Tribunal to State a case was not justified.

(2.) PETITIONER is registered as a dealer under the Act. He carries on business of body building. In respect of the years 1975-76, 1976-77 and 1977-78, he filed returns and paid tax at the rate of 6 per cent on the turnover relating to supply of bus bodies. Assessing Officer not being satisfied with the return figure called upon the petitioner to produce his accounts for inspection so that while making best judgment assessment under section 12(4) he can determine the turnover taking assistance from the accounts. Petitioner produced accounts for the year 1975-76, but did not produce any such account in respect of other two years. Assessing officer accordingly, determined the taxable turnover to the best of his judgment and assessed tax at 12 per cent of the turnover on the finding that motor vehicle bodies are part and parcel of motor vehicle and they are liable to tax at the same rate as a motor vehicle. Against the assessments for three years, petitioners preferred three appeals before Assistant Commissioner. All the three appeals were heard together by the Assistant Commissioner who passed a common appellate order setting aside assessment orders and remitting back the proceedings for fresh assessments. Assistant Commissioner held that bus bodies are components of motor vehicle and liable to tax at 12 per cent from 1st May, 1976, 13 per cent from 1st January, 1978 and for the period prior to 1st May, 1976 at the same rate as in respect of residuary goods for which no specific rate had been fixed in the notifications under section 5 of the Act. State Government was aggrieved by order of remand and preferred three second appeals. Cross-objections were filed by the assessee being aggrieved by order of remand assailing rate of tax. All the three second appeals were heard and disposed of together by a common order in which Tribunal dismissed the appeals confirming the order of the Assistant Commissioner. Petitioner filed application under section 24(1) of the Act before the Tribunal to state a case in respect of 1976-77 only. Tribunal having refused to state a case, this application under section 24(2)(b) of the Act has been filed in this Court by the petitioner in respect of the year 1976-77. Though not grammatically accurate, the question of law as framed by the petitioner is quoted below :

(3.) BEFORE examining merit of contentions of Mr. Misra, it is profitable to observe that in this case orders of assessment have been set aside on the finding that dealer was not given reasonable opportunity for producing accounts. Even if assessing officer did not give reasonable opportunity, first appellate authority had jurisdiction to examine his accounts and finally determined the turnover and tax leviable. No reason has been indicated in the order why the matters were remitted back. Assessee has paid tax at the rate of 6 per cent only. If the Assistant Commissioner is correct that rate of tax payable is 12 per cent or 13 per cent, he ought to have determined the turnover after examining the accounts and the tax payable. Unnecessary public time is consumed in this process and in case there is stay of realisation of tax, public money is kept in the hands of the assessee. It seems serious view has not been taken by the Commissioner in this respect. Tribunal, while examining appellate order of setting aside assessment orders ought to keep the aforesaid principle in mind to give necessary directions to Assistant Commissioner. It is not known why State Government did not assail the order of the Tribunal confirming appellate order setting aside assessment. When cross-objections were filed by the assessee, Tribunal could have called upon the assessee to produce the accounts and on examination of those accounts, could have finally concluded the assessments. At no stage due care has been taken to finalise assessments keeping in mind that on the principle laid down, assessee is liable to pay tax at higher rate and State exchequer is likely to be deprived of the same till matter remains pending. It is doubtful if assessment has yet been completed by the assessing officer after remand which we are sure, Commissioner shall take care to examine. It is to be taken note that pendency of an application for reference is no ground to stay the entire proceeding awaiting the finality. In the present case, however, it is not necessary to examine this question further.