PREM WATI Vs. ASSESSING AUTHORITY

JUDGEMENT

(1.) ASSESSMENT regarding two assessment years is required to be examined in the present litigation. The two assessment years are 1977 -78 and 1978 -79.

(2.) BEFORE examining the question raised in the petition it would be apt to notice in brief the scheme vis -a -vis filing of returns and the assessments which are made under Sales Tax Laws. Relevant Section 7 of the Jammu and Kashmir General Sales Tax Act. 1962 (here -in -after referred to as the Act). Under Section 7(1) every registered dealer has to furnish returns by such date as may be prescribed. Under Sub -Section (2) if any dealer discovers an omission or error in any return furnished by it, it may furnish revised returns. This is, however, to be done before the assessment is made on original return. The further provision is contained in sub -Section (4). This is to the effect that if the assessing authority is satisfied that a dealer for a reasonable cause has been unable to furnish any return within the prescribed period and the said Authority may extend the period for filing, such return. Again under sub -section (6) if the Assessing authority is satisfied that the annual return submitted under sub -section (1) or sub -section (3) of the Act is correct and complete, he is supposed to assess the amount of tax due from the dealer on the basis of return filed by the assessee. Sub -Section (10) deals with an eventuality where return is not submitted before the assessing authority. In such a case, the assessing authority has to make best judgment assessment within a period of four years after the expiry of the date fixed for purposes of assessment. In making best judgment assessment reasons are supposed to be given. However, where the assessing authority is not satisfied that the return furnished is correct and complete, the assessing authority is supposed to issued a notice in the prescribed manner calling upon the assessee to produce or cause to be produced any evidence on which the assessee may wish to reply the after giving due opportunity, assessment is made in terms of Section 7(7) of the Act. Two other sub -sections which are required to be taken note of are sub -section (11) and sub -section (12). Under sub -section (11) where the assessing authority has reason to believe that by reason of omission or failure on the part of a dealer to make a return under sub -section (1) or sub -section (3) for any year, to the assessing authority or to disclose fully and truly all material facts necessary for assessment for that year, the turn over chargeable to tax has escaped assessment, or has been assessed at the lower rate for the year in whole or in part; or if there has been no omission or failure as mentioned in sub -section (11) (a) on the part of the dealer, but the assessing authority has some information in his possession and on that basis, it has reason to believe that the turn over chargeable tax has escaped assessment or has been assessed at a lower rate, then the assessing authority subject to the provisions of sub -section (12) and (13) can assess or re -assess the dealer. Sub section (12) deals with the procedure i.e. before making assessment or re -assessment under sub -section (11), the assessing authority is supposed to serve the dealer with notice in the prescribed form which should indicate full particulars on which action is proposed to be taken with a view to assess or re -assess the assessee. It is in the light of the aforementioned provisions contained in Section 7, or the Act, the factual and legal submissions which have been made in the present petition are being noticed.

(3.) AS indicated above, the assessment years are 1977 -78 and 1978 -79. for the assessment year 1977 -78, the returns were filed on 10.11.1979. The gross sales were fixed at Rs. 6,61,945.23. The taxable turn over was shown as Rs. 4,64,426.00. The return as filed by the assessee was not accepted. The Assessing authority was of the view that the taxable turnover is Rs. Ten lacs. On this, assessment was made. This order was appealed against. The appellate authority set aside the order. This is annexure "A" with the petition. The matter was remanded for de novo assessment. The further fact is that on 20.02.1981, the assessing authority issued a notice in form ST -19, calling upon the assessee to appear on 09.03.1981. This notice was issued in terms of Section 7(12) of the act. The form which was used was form ST -19. The further fact which is pleaded by the petitioner is that on 16.03.1981 notice in form ST -18 for re -assessment was issued for 07.04.1981. Some proceedings were taken before the said authority on 07.04.1981, 14.05.1981 and 05.06.1981. Thereafter, another notice in form ST -19 came to be issued on 10.11.1982. On this also, some proceedings were taken on 23.11.1982 and 26.11.1982. Therefore, an order was passed. Proceedings initiated on the basis of form -ST -19 were ordered to be dropped. This happened on 27.11.1982. The requisite averments in this regard are made in paragraph "6" of the writ petition. This para reads as under: "On 27.11.1982 Respondent No. 1 passed the following order: -