COMMISSIONER OF SALES TAX Vs. AYURVEDA PRACHAR SAMITI

JUDGEMENT

(1.) In this case the assessee applied for registration under Section 9 of the Bihar Sales Tax Act before the Superintendent of Sales Tax, Urban Circle, Patna, stating that for the period from the 1st April, 1955, to the 30th September, 1955, the turnover of its business had exceeded the limit of Rs. 15,000 provided under the Act. On the basis of the information supplied in the application a registration certificate was granted on the 5th November, 1955, to the assessee in Form No. II of the Bihar Sales Tax Rules, wherein it was stated that the assessee "is liable to pay tax on sales made from the 1st October, 1955". Later on it was discovered on inspection by Sri. S. Chandra, Inspector of Sales Tax, that the assessee has been carrying on business at least from the year 1948. The Inspector reported that the proprietor of the business was Ashwani Kumar Sarkar, who was also the proprietor of Saudamani Stores. On the 22nd July, 1956, the Superintendent of Sales Tax initiated a proceeding under Section 13(5) of the Bihar Sales Tax Act for assessment of sales tax against the assessee for the period from the 2nd July, 1952, to the 30th September, 1955. The assessment was made by the Superintendent of Sales Tax to the best of his judgment because the assessee deliberately failed to produce the relevant books of account. An appeal was taken by the assessee to the Assistant Cmmissioner of Commercial Taxes, but the appeal was dismissed. An application in revision was made before the Deputy Commissioner of Commercial Taxes, and the argument was advanced that the assessment made under Section 13(5) of the Bihar Sales Tax Act was illegal since it was tantamount to a review of the previous order of the Superintendent of Sales Tax dated the 5th November, 1955, granting registration certificate, and the review proceeding could not be started without the previous sanction of the Commissioner. The argument was rejected by the Deputy Commissioner of Commercial Taxes, but when the matter was taken in revision before the Board of Revenue the revision application was allowed and the Board of Revenue held that the assessment proceeding under Section 13(5) of the Act was illegal and should be set aside because it is tantamount to a review of the previous order granting registration certificate which fixed the liability of the assessee from the 1st of October, 1955. Under Section 25(3) of the Bihar Sales Tax Act the Board of Revenue has referred the following question of law for the opinion of the High Court :- Whether on the facts and circumstances.of the case the order of assessment dated the 28th September, 1956, passed by the Superintendent, Sales Tax, Patna, amounted to an order of review and was invalid for want of sanction of the Commissioner as required under Rule 39, Sub-rule (3), of the Sales Tax Rules, 1949?

(2.) On behalf of the State of Bihar the learned Government Advocate put forward the argument that the Board of Revenue was erroneous in holding that the order of assessment made under Section 13(5) of the Bihar Sales Tax Act by the Superintendent of Sales Tax on the 28th September, 1956, was tantamount to an order of review within the meaning of Section 24(5) of the Bihar Sales Tax Act, and that previous sanction of the Commissioner was necessary under Rule 39(3) of the Bihar Sales Tax Rules, which reads as follows :- 39. Review * * * * (3) No officer below the rank of Commissioner shall review any order which has been passed by any of his predecessors-in-office, except with the previous sanction of the Commissioner.

(3.) In our opinion the argument of the learned Government Advocate is well founded and must be accepted as correct. The order of the Superintendent of Sales Tax granting a registration certificate on the 5th November, 1955, was made under the power granted by Section 9 of the Bihar Sales Tax Act, which provides for registration of dealers and which is to the following effect :-