TARA CHAND NAHATA Vs. SUPERINTENDENT OF TAXES

JUDGEMENT

(1.) The validity of a best judgment assessment made by an order dated 10.11.1993 by the Jurisdictional Superintendent of Taxes is the subject matter of challenge in this writ proceeding. The penalty imposed by the aforesaid order dated 10.11.93 is also an incidental challenge in the present proceeding.

(2.) The Assam General Sales Tax Act, 1993 (hereinafter referred to as Act of 1993) consolidated the law regarding levy of tax on sales and purchase of goods in the State of Assam. The said statutory enactment came into force with effect from 1.7.1993. The petitioner who used to carry on the business of sale of lottery tickets, an item which was not taxable prior to coming into force of the Act. received a notice dated 2.8.1993 from the Superintendent of Taxes, Guwahati Unit-c informing the petitioner that it had sold lottery tickets of the value of Rs.51,15,485.00 for the period from 1.7.93 to 31.7.1993 attracting tax at the rate of 10% Consequently, the writ petitioner was asked to apply for registration on or before 31.7.1993 and also to deposit the tax due for the month of July, 1993. It appears that the petitioner did get itself registered as dealer under the Act of 1993 and the liability of the dealer to pay tax under the said Act was made effective from 1.7.1993. Thereafter, on 1.10.93 the Jurisdictional Superintendent of Taxes again wrote to the petitioner to show cause in writing and to appear personally on 7.10.93 as to why penalty should not be imposed on it for failure to submit the returns for the month of July and August, 1993. The aforesaid communication was followed by a subsequent notice in writing dated 8.10.93 intimating the petitioner of its failure to submit requisite returns for the aforesaid two months and asking the petitioner to pay the entire tax due within 14.10.93. In the aforesaid communication dated 8.10.93 it has further been mentioned that in the event, the petitioner did not file the returns within 14.10.93, tax will be assessed on the basis of the turnovers mentioned in the said communication. The petitioner was further informed that if it failed to submit its return within 14.10.93, penalty under Section 23(c) of the Act would be imposed. The petitioner by its reply dated 14.10.93 requested for grant of three weeks time for payment of tax and submission of returns and also prayed for dropping of proposed proceeding of summary assessment and penalty against the petitioner. It may be noticed that the petitioner in its reply dated 14.10.93 did not raise any dispute with regard to the turnovers for the months of July and August, 1993 as mentioned in the notice dated 8.10.93. On the contrary the petitioner, in the said reply dated 14.10.93, had indicated certain financial difficulties for its inability to pay the entire tax due for the period in question and the fact that a sum of Rs. 30,000/- was paid as advance tax. It appears from the records produced on behalf of the State Respondents that time as prayed for was granted up-to 27.10.93. On 27.10.93, 15-20 days further time was again prayed for and it appears that time until 6.11.1993 was allowed. On 8.11.93 returns for the two months in question were filed by the pentitioner and as the said returns were not accompanied by the requisite proof of full payment of tax due the authority by order dated 10.11.93, proceeded to make a best judgment assessment under the provisions of Section 17 (5) of the Act of 1993 read with rule 25 (3) of the Rules. By the same order dated 10.11.93, penalty was imposed @ 1 times the tax payable under the provisions of Section 23 of the Act. Aggrieved, this instant writ petition has been filed.

(3.) Dr. A Saraf, learned senior counsel appearing for the writ pentitioner has assailed the impugned order, on what appears to be two principal grounds. Learned counsel by relying on the decision of this court in the case of Dwijendra Kumar Bhattacharjee-Vs.- Superintendent of Taxes Government of Tripura and others reported in 1989 (2) GLR 461 has contended that a perusal of the order dated 10.11.93 passed by the jurisdictional Superintendent of Taxes would go to show that the said authority had finalized the best judgment assessment on the basis of certain documents in his possession. As the power of assessing officer to make an assessment including a best judgment assessment is a quasi judicial power, learned counsel, on the authority of the law stated above, submits that the aforesaid materials ought to have been made available to the writ petitioner in consonance with the principles of natural justice. As the same has not been done, the impugned order dated 10.11.93, in so far as the assessment is concerned, is vitiated in law. Secondly, it has been argued by the learned counsel for the petitioner that as returns were filed by the petitioner on 8.11.1993, exercise of power under Section 17 (5) of the Act is bad in law and the jurisdictional Superintendent of Taxes ought to have finalized the assessment on the basis of the returns filed by the petitioner by invoking the provisions of Section 17 (3) of the Act.