MAQSUDA BEGUM Vs. STATE OF J&K

JUDGEMENT

(1.) THE petitioner has averred that she was a partner of the Ex -firm namely M/s Jay Kay Automobiles situate at Residency Road Srinagar. In the accounting period of 1961 -62 the said firm was registered with the assessing authority, the respondent No. 3 under Jammu and Kashmir General Sales Tax Act of 2004 Svt. (the old Act). The old Act of 2004 was repealed and the new Act called the Jammu and Kashmir General Sales Tax Act of 1962 came into force from 1 -9 -1962 vide Notification No. SRO -182 dated 16 -8 -1962. Under the old Act quarterly returns have been prescribed but these were not filed by the firm for the accounting period of 1961 -62, nor could sales tax due thereon be deposited during the said year. It was, however, for the first time on 14 -3 -1966 that respondent No. 3 issued a notice in form ST -VIII under the New Act which reached the other partner of the petitioners firm at New Delhi on 21 -3 -1966 whereas the date fixed in the said notice was 24 -3 -1966 which was in direct contravention of Rule 10 of the New Act. The minimum period of 10 days as prescribed was not allowed. The respondent No. 3 however completed the impugned assessment as exparte on 28 -3 -1966 under section 7(5) of the new Act at total sales of Rs. 26,03,340.00 for the accounting year 1961 -62 and in addition he imposed a penalty of Rs. 1000.00 (vide annexure A). The notice of demand of Rs. 1,30,167.00 in form No. ST. XIII under rule 35 was served on the other partner of the Ex -partnership firm at New Delhi on 24 -4 -1966. Against this order an appeal was preferred before the respondent No. 2 by one Shri B. K. Bedi one of the Partners of the Ex. firm. The petitioner paid a sum of Rs. 14,500.00 as tax and also penalty of Rs, 1000.00 under protest before the appeal was fixed for hearing. The said appeal was, however, disposed of by the respondent No. 2 on 29 -8 -1972 (vide annexure E). According to the judgment given in the appeal respondent No. 2 has remitted the case to the respondent No. 3 for the purpose of making assessment afresh after affording an opportunity to the appellant to present his case. It is averred by the petitioner that in pursuance of the appellate order respondent No. 3 has issued notice (Annexure F) to the petitioner to appear before him for fresh assessment. The petitioner challenges the original order of assessment of respondent No. 3 and also the appellate order of respondent No. 2 on the ground that both these orders are without jurisdiction of the respondents Nos. 2 and 3 respectively as the assessment could net have been made under the new Act because nothing was done and no action taken under the old Act against the petitioner so as to save the operation of the old Act. Hence the petitioners firm had ceased to be liable under the new Act as the old Act had extinguished itself on 18 -7 -1962. As the old Act stood removed from the statute Book for all times en 1B -7 -1962, therefore no action could be taken under the new Act against the petitioner as the petitioners case never fell under the proviso to Sec. 27 of the New Act. Further the new Act authorities the imposition of the sales tax on all sales made from 1 -9 -62 to onwards and not for any period prior to that date because the new Act came into force from 1 -9 -1962 only, therefore sales affected prior to this date fell outside the purview of the new Act. The impugned assessment order is barred by limitation and respondent No. 2s action of sending it back to respondent No. 3 fresh assessment gives new lease of life to these proceedings and extends limitation for the whole proceedings which is against the established principle of law. Respondent No. 2 has failed to assess the tax before 31st of March 1966 as no computation of tax was made by him in the assessment order and all that he made was the computation of turn over only while the respondent No. 2 was bound under section 7(7) of the new Act to do the same and he could not ignore the mandatory provisions of this Section. The view taken by the respondent No. 2 in its appellate order that as the assessment year was 1962 -63, therefore the assessment was within time was wholly erroneous. The petitioner therefore prayed that a writ of certiorari be issued holding that the assessment order of respondent No. 3 (Annexure A) was without jurisdiction and thus void ab -initio and therefore be quashed. The appellate order of respondent No. 2 (Annexure E) and notice (Annexure F) issued by respondent No. 3 pursuant to the appellate order be also declared illegal, without jurisdiction and quashed. A writ of prohibition be issued against the respondent No. 3 not to proceed against the petitioners firm for making fresh assessment in consequence of respondent No. 2s appellate order. The direction given by respondent No.

(2.) BE held unenforcible. As a consequential relief. the amount of Rs. 15,500.00 as recovery paid by the petitioner under protest be held as refundable to the petitioner. 2. In his reply affidavit Shri Ghulam Abbas assessing authority Sales Tax Circle Srinagar has sworn the following facts: - It is averred that M/s Jay Kay Automobiles consisted of the following partners in the year 1961 -62: -

(3.) THE said firm dealt in the sale of Motor Vehicles and was duly registered in the Sales Tax Department of the State. The firm however, discontinued its business but there was nothing on the records to show that the said firm had dissolved. It is admitted that the old Act of 2004 continued to be in force till 1 -9 -1962 when the new Act came into force. By virtue of Sec. 27 of the new Act the old Act was no doubt repealed but such repeal did not affect the obligations and liabilities incurred under the old Act and the proceedings taken thereunder. Under the old Act and the Rules framed thereunder a return of the turn over by a dealer was required to be submitted to the Assessing Authority after the close of the accounting year. The firm in question was accordingly required to submit its return in respect of its turn over for the financial year 1961 -62 during the assessment year 1962 -63 which it had failed to do. As the firm had failed to submit a return of its turn over and deposit the tax to be paid by it for the Accounting year 1961 -62, a notice was issued in the prescribed manner by the respondent No. 3 on 16 -3 -1966 which was duly served upon it. However no returns were filed by the firm. Consequently respondent No. 3 assessed the firm to the best of his judgment under section 7 Sub -Section (5) of the new Act. A demand notice for paying the tax assessed was issued. On appeal, however, respondent No. 2 set aside the aforesaid assessment order on the ground that the assessee had not been given sufficient time to produce its accounts, therefore fresh assessment was ordered to be made in the case. It is admitted that appellant in that case had paid an amount of Rs. 15,500.99 before the hearing of the appeal. In pursuance of the appellate order the petitioner was served with a fresh notice by respondent No. 3. It is contended that the writ petition is without substance. The proceedings taken by respondents 2 and 3 are legal and they do not suffer from any defect of jurisdiction or otherwise of any legal infirmity. The petitioner had an efficacious and alternative remedy to pursue, therefore the petition is not maintainable until all the remedies provided under the Act were exhausted by the petitioner. In fact the petitioner filed a revision petition against the order of the respondent No. 2 before the Commissioner Sales Tax but did not pursue the same as a result of which the revision petition was dismissed for default. The reasons stated by the petitioner, it is submitted, in the reply affidavit, are devoid of any merit and wholly untenable. Respondents had acted within their respective jurisdiction and as the liability to tax had been incurred during the operation of the old Act therefore respondents were justified in enforcing that obligation under the new Act by virtue of the saving clause. There was also no question of refunding the amount paid by the petitioner firm as tax and the prayer was liable to be rejected.