Over 2 lakh Indian cases. Search powered by Google!

Case Details

M/S PASWARA CHEMICALS LTD. versus DY. COMMISSIONER (ASST.)

High Court of Judicature at Allahabad

Case Law Search

Indian Supreme Court Cases / Judgements / Legislation

Judgement


M/S Paswara Chemicals Ltd. v. Dy. Commissioner (Asst.)-Ii, Trade Tax, Meerut & Others - WRIT TAX No. 1417 of 2006 [2006] RD-AH 16991 (27 September 2006)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

Reserved

Civil Misc. Writ Petition No.1417 of 2006

M/s Paswara Chemicals Ltd. v. Deputy Commissioner

(Assessment) - II, Trade Tax, Meerut and others

and

Civil Misc. Writ Petition No.1418 of 2006

M/s Modern Chemicals Ltd. v. Deputy Commissioner

(Assessment) - II, Trade Tax, Meerut and others

Hon'ble R.K.Agrawal, J.

Hon'ble Vikram Nath, J.

(Delivered by R.K.Agrawal, J.)

Civil Misc. Writ Petition No.1417 of 2006 has been filed by M/s Paswara Chemicals Ltd. through its Director Sri Rajeshwar Prasad Agrawal whereas Civil Misc. Writ Petition No. 1418 of 2006 has been filed by M/s Modern Chemicals through its Partner Sri Rajeshwar Prasad Agrawal, claiming similar reliefs, viz., quashing of the separate provisional assessment orders passed by the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, for the months of April, May and June, 2006 pertaining to the assessment year 2006-07 and for restraining the respondents not to recover the amount of tax assessed for the aforesaid period pursuant to the provisional assessment orders.

Briefly stated, the facts giving rise to Civil Misc. Writ Petition No. 1417 of 2006 are as follows:-

The petitioner is a company incorporated under the provisions of the Companies Act, 1956. It has its Head Office at Baghpat Road, Meerut. In the first week of July, 2006, its Head Office was changed from Baghpat Road to Mohiuddinpur Delhi Road, Meerut. It is registered under the provisions of the U.P. Trade Tax Act, 1948 (hereinafter referred to as "the U.P.Act") as well as the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Act"). It is engaged in the business of manufacture and sale of petroleum products. It has its unit at Mohiuddinpur in the district of Meerut when it commenced production in December, 2003. It maintains its books of account and other documents as required under the U.P.Act as also under the Central Excise Act. It had filed regular return for the assessment year 2006-07 under the provisions of the U.P.Act. On account of the change of its Head Office from Baghpat Road, Meerut to Mohiuddinpur Delhi Road, Meerut in the month of July, 2006, and the consequent change of its principal place of business, it made an application before the Additional Commissioner Grade I, Trade Tax, Meerut, respondent no.3, that the principal place of business be treated at Mohiuddinpur Delhi Road, Meerut instead of the earlier premises which was at Baghpat Road, Meerut. The principal place of business now falls within the territorial limit of the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2.  The Additional Commissioner, Trade Tax, respondent no.3, after obtaining the report of the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, vide order dated 11.8.2006, granted approval to the change of the principal place of business of the petitioner to Mohiuddinpur Delhi Road, Meerut. The said order was passed under sub-rule (7) of Rule 6 of the U.P. Trade Tax Rules (hereinafter referred to as "the U.P.Rules"). After passing of the aforesaid order, the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2, became the Assessing Authority of the petitioner. The Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, issued separate notices purporting to be under Rule 41(5) of the U.P.Rules, calling upon the petitioner to show cause as to why the provisional assessment for the months of April, May and June, 2006 be not made. After receipt of the notice, the petitioner filed revised return for the months of April, May and June, 2006 before the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2, and also deposit the admitted tax. After filing the revised return, the petitioner filed an application on 19.8.2006 before the respondent no.1 stating therein that it had already filed its revised return before the respondent no.2 who has the territorial jurisdiction and has deposited the admitted tax alongwith interest. The petitioner also raised objection regarding the territorial jurisdiction of the respondent no.1 in dealing with the matter and in proceeding to make the provisional assessment. It also reserved its right to file detailed objection. The respondent no.1 rejected the application filed by the petitioner and vide order dated 21.8.2006 for the months of April and May, 2006 and order dated 23.8.2006 for the month of June, 2006 passed provisional assessment orders. According to the petitioner, it had also made an application before the Additional Commissioner, respondent no.3, to transfer all its cases including the record and pending matters relating to the assessment year 2006-07. The provisional assessment orders for the months April, May and June, 2006 are under challenge in the present petition.

In Civil Misc. Writ Petition No.1418 of 2006 filed by M/s Modern Chemicals the facts are that it is a partnership firm which is registered under the Indian Partnership Act, 1932. It has its Head Office at Baghpat Road, Meerut but in the first week of July, 2006, its Head Office had been shifted from Baghpat Road, Meerut to Mohiuddinpur Delhi Road, Meerut. It is registered under the provision of the U.P.Act and the Central Act and is engaged in the business of manufacture and sale of petroleum products. Rest of the facts are common to the facts already stated in respect of M/s Paswara Chemicals Ltd. except the provisional assessment order for the months of April, May and June, 2006 have been passed by the respondent no.1 on 22.8.2006 which orders are under challenge in the present petition.

We have heard Sri Rakesh Ranjan Agrawal, learned counsel for the petitioner, and Sri M.R.Jaiswal, learned Standing Counsel appearing for the respondents.

As both the writ petitions involve common questions, they have been heard together and are being decided by a common order.

Sri Rakesh Ranjan Agrawal submitted that after the principal place of business has been changed by the petitioner from Baghpat Road, Meerut to Mohiuddinpur Delhi Road, Meerut, the jurisdiction lay with the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2 and the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, ceased to be the Assessing Authority as he had no territorial jurisdiction over the petitioner. According to him, after 11.8.2006 on which date the Additional Commissioner, Trade Tax, Meerut, respondent no.3, had passed the order of transfer, the respondent no.2 alone had the jurisdiction to make any assessment - whether provisional or final - against the petitioner and, therefore, the action of the respondent no.1 in proceeding to pass provisional assessment orders for the months of April, May and June, 2006 on 21/23.8.2006 in the case of M/s Paswara Chemicals Ltd. and on 22.8.2006 in the case of M/s Modern Chemicals, is wholly illegal and without jurisdiction. Inviting the attention of the Court to the provisions of Section 2(j) of the U.P.Act, he submitted that the assessment year means 12 months ending on March 31. According to him, the provisional assessment orders are also relatable to an assessment year and neither the U.P.Act nor the U.P.Rules contemplate an assessment order to be passed in two parts - one by the Assessing Authority who had the territorial jurisdiction prior to the date of change of the principal place of business and the other by the Assessing Authority who has the territorial jurisdiction after the change of the principal place of business. He further submitted that the circular dated 6.4.2002 issued by the Commissioner, Trade Tax, U.P., Lucknow, has been misinterpreted by the respondent no.1 and, in any event, passing of an assessment order relying upon a circular issued by the Commissioner, Trade Tax, U.P., Lucknow is not permissible under law, in support of which he has relied upon a decision of this Court in the case of M/s Mercury Laboratories Pvt. Ltd. v. State of U.P. and others, 2000 UPTC 82.  He further submitted that under sub-rule (7) of Rule 6 of the U.P.Rules, the Commissioner, or any other officer authorised by him, is entitled to change the principal place of business on such condition as he may deem fit to impose. In the order dated 11.8.2006 passed by the respondent no.3 permitting the change of the principal place of business, the respondent no.3 had not imposed any condition whatsoever and, therefore, the respondent no.1 had no jurisdiction to pass the provisional assessment orders.

Sri M.R.Jaiswal, learned Standing Counsel, on the other hand, submitted that against the provisional assessment orders the petitioners have a right of appeal under Section 9 of the U.P.Act and, therefore, the present writ petitions are not maintainable. He further submitted that under sub-rule (1) of Rule 6 of the U.P.Rules that Officer would have the jurisdiction where a dealer carries on business within the limits of jurisdiction of only one Trade Tax Officer. According to him, as prior to 11.8.2006, passed by the respondent no.3 permitting the change of the principal place of business, the petitioner was carrying on business within the territorial jurisdiction of respondent no.1, and he alone would be the Assessing Authority for the petitioners upto that period. The circular dated 6.4.2002 issued by the Commissioner, Trade Tax, U.P., Lucknow only reiterates this principle. There is no question of any misinterpretation of the circular or mechanically following the same.

We have given our anxious considerations to the various pleas raised by the learned counsel for the parties.

It is not in dispute that upto 10.8.2006 the principal place of business declared by both the petitioners was at Baghpat Road, Meerut. The territorial jurisdiction was with the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1. The petitioner had filed its return for the months of April, May and June, 2006 with the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1. On or after 11.8.2006, the principal place of business of both the petitioners stood changed to Mohiuddinpur Delhi Road, Meerut which is within the territorial jurisdiction of the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2.  On these undisputed facts, the question is whether the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1,  or the Deputy Commissioner (Assessment) - III, Trade Tax, Meerut, respondent no.2, will have the jurisdiction to pass provisional assessment orders for the months of April to June, 2006.  

Before going into the question of jurisdiction, we are taking up the preliminary objection raised by the learned Standing Counsel regarding availability of alternative remedy available to the petitioner by way of filing an appeal under Section 9 of the U.P.Act against the provisional assessment orders.

It is well settled that alternative remedy is not an absolute bar from entertaining a writ petition under Article 226 of the Constitution of India where the challenge is that the order impugned is without jurisdiction.

The Apex Court in the case of State of U.P. v. Anil Kumar Ramesh Chandra Glass Works and another, (2005) 11 SCC 451,  has held as follows:-

".....this Court had repeatedly held that Article 226 should not be permitted to be invoked in order to challenge show cause notices unless accepting the fact in the show cause notices to be correct, either no offence is disclosed or the show cause notices are ex facie without jurisdiction."

The Apex Court in the case of Standard Chartered Bank and others v. Directorate of Enforcement and others, (2006) 4 SCC 278, has held that -

"It is settled by the decisions of this Court that a writ of prohibition will issue to prevent a Tribunal or Authority from proceeding further when the Authority proceeds to act without or in excess of jurisdiction; proceeds to act in violation of the rules of natural justice; or proceeds to act under a law which is itself ultra vires or unconstitutional.  Since the basis of the claim for the relief is found not to exist, the High Court rightly refused the prayer for the issue of a writ of prohibition restraining the Authorities from continuing the proceedings pursuant to the notices issued.  As indicated by this Court in State of Uttar Pradesh Vs. Brahm Datt Sharma [(1987) 2 SCC 179] when a show cause notice is issued under statutory provision calling upon the person concerned to show cause, ordinarily that person must place his case before the Authority concerned by showing cause and the courts should be reluctant to interfere with the notice at that stage unless the notice is shown to have been issued palpably without any authority of law.  On the facts of this case, it cannot be said that these notices are palpably without authority of law.  In that situation, the appellants cannot successfully challenge the refusal by the High Court of the writs of prohibition prayed for by them."

In the present case, we find that the petitioners have challenged the various provisional assessment orders on the ground that the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, has no jurisdiction to pass such orders. Thus, the preliminary objection raised by the learned Standing Counsel is overruled.

For a proper adjudication of the issue raised in these petitions, the provisions of Sections 2(f), 2(j) and 7 of the U.P.Act and Rules 6 and 41 of the U.P.Rules are reproduced below:-

"Section 2. Definitions.

....... ......

(f) ''prescribed' means prescribed by Rules made under this Act;

....... ......

(j)(i) ''assessment year' means the twelve months ending on March 31;"

....... ......

Section 7. Determination of turnover and assessment of tax.

(1)Every dealer who is liable to pay tax under this Act shall submit such return or returns of his turnover at such intervals, within such period, in such from and verified in such manner, as may be prescribed; but assessing authority may in its discretion, for reasons to be recorded, extend the date for the submission of the return by any person or class of persons.

(1-A) Before submission the return under sub-section (1) or along with such return the dealer shall deposit, in such manner as may be prescribed the amount of tax due on the turnover shown in such return.

(1-B) Where as a consequence of the date for the submission of return being extended under sub-section (1) on the application of any person, the deposit of tax under sub-section (1-A) is deferred, there shall be payable interest at the rate of two per cent. Per mensem on such deposit from the date immediately following the last date prescribed for the submission of the return.

(1-C) If any dealer discovers any omission or other error in any return submitted by him he may, at any time, before the time prescribed for submitting the next return, submit a revised return. If the revised return shows a greater amount of tax to be due than was  show in the original return, the dealer shall also deposit separately the difference of tax due and the interest payable  under sub-section (1-B) as if the time of submitting the original return has been extended on the application of the dealer to the date of submission of the revised return. If, however, the revised return shows lesser amount of tax to be due than was shown in the original return the dealer may adjust the excess amount towards the tax due for the subsequent periods.

(1-D) If the goods sold or purchased by a dealer are returned within six months of the date of sale of purchase and assessment for the year to which such sale or purchase relates is as yet to be made he may within thirty days of the expiry of the month in which such goods are returned submit for that purpose only a revised return for the period during which such sale or purchase was made.

(2) If the assessing authority, after such enquiry as he considers necessary is satisfied that any returns submitted under sub-section (1) are correct and complete, he shall assess the tax on the basis thereof.

(3) If no return is submitted by the dealer under sub-section (1) within the periods prescribed in that behalf or if the return submitted by him appears to the assessing authority to be incorrect or incomplete, the assessing authority shall, after making such enquiry as he considers necessary, determine the turnover of the dealer to the best of his judgment and assess the tax on the basis thereof:

Provided that before taking action under this section the dealer shall be given a reasonable opportunity of proving the correctness and completeness of any return submitted by him.

Explanation. - In this section and in sections 7-A, 7-B. 7-C, 7-D, 7-E, 8-A, 14, 15-A, 18, 21, and 24 the expression, ''turnover' means the turnover of sales or of purchases or both, as the case may be.

(4)Every person to whom section 28-B applies and for whom a presumption under the said section exists that the goods have been sold within the State by such person shall, in the manner prescribed, be assessed to tax at the check post on the goods covered by each authorisation for the transit of goods separately.

(5)The provisions of sub-section (4) shall apply to all the cases for assessment whether arising before of after the date of the commencement of Uttar Pradesh Sales Tax (Amendment) Act, 1995.

(6) No order of assessment under sub-sections (4) and (5) shall be passed until the owner or person-in-charge of the vehicle, as the case may be, is given a reasonable opportunity of being heard."

"Rule 6. Jurisdiction of Assessing Authority.- (1) If a dealer carries on business within the limits of jurisdiction of only one Trade Tax Officer, that officer shall be the assessing authority in respect of the dealer and the place where he carries on business shall be deemed to be his principal place of business.

(2) If a dealer carries on business within the limits of jurisdiction of more than one Trade Tax Officer, he shall within thirty days of the commencement of business declare one of the places of his business as his principal place of business in U.P. and shall intimate all the Trade Tax Officers within whose limits of jurisdiction his places of business are situated. The Trade Tax Officer within whose limits of jurisdiction the principal place of business so declared by the dealer is situated, shall be the assessing authority in respect of such dealer:

Provided that in the case of any Department of Central Government or of the State Government or of a Company, Corporation or Undertaking owned or controlled by the Central Government or by a State Government carrying on business within the limits of jurisdiction of more than one Trade Tax Officer, the Commissioner or any officer authorized by him in this behalf may order that each Trade Tax Officer within whose jurisdiction such Department, Company Corporation or Undertaking is carrying on business shall be the assessing authority in respect of the place or places of business within the limits of the jurisdiction, or permit such Department, Company, Corporation or Undertaking to declare one place of business as the principal place of business in U.P., in which case the Trade Tax officer, within whose limits of jurisdiction such declared principal place of business is situated, shall be the assessing authority in respect of such Department, Company, Corporation or Undertaking.

(3) If the principal place of business of a dealer is situated outside U.P. and such dealer carries on business at only one place in U.P., the Trade Tax Officer within whose limits of jurisdiction the place of business in U.P. is situated shall be the assessing authority in respect of such dealer.

(4) If the principal place of business of a dealer is situated outside U.P., and such dealer carries on business at more than one place in U.P., he shall declare one of his places of business in U.P., as the principal place of business in U.P. within thirty days of the commencement of business and shall intimate all the Trade Tax Officers within whose limits of jurisdiction his places of business are situated. The Trade Tax Officer within whose limits of jurisdiction the principal place of business so declared is situated shall be the assessing authority in respect of such dealer.

(5) If no declaration as required under sub-rule (2) or sub-rule (4) is made by a dealer within the time specified therein, the Commissioner or any officer authorized by him in this behalf shall determine the Trade Tax Officer who will be the assessing authority in respect of such dealer and his decision shall be final.

(6) If a dealer has no fixed place of business, the Trade Tax Officer within whose limits of jurisdiction he ordinarily resides shall be the assessing authority in respect of such dealer.

(6-a) The Officer-in-charge of the check post shall be the assessing authority under sub-sections (4) and (5) of section 7 of the Act in respect of the owner or person-in -charge of the vehicle obtaining authorisation for transit of goods from that check post.

(7) No, dealer, who has once made a declaration under sub-rule (2) or sub-rule (4) or who has failed to make such declaration within the time specified therein, shall be allowed to change the same or, as the case may be, to make a declaration except with the previous written permission of the Commissioner or any officer authorised by him in this behalf, and on such conditions as he may deem fit to impose.

(8) Whenever there is any doubt or if any of the sub-rules of this rule do not apply, the Commissioner shall determine the Trade Tax Officer who will be the assessing authority in respect of a dealer, and his decision shall be final.

Rule 41. Submission of returns and assessment of tax.

(1) Every dealer liable to tax, the aggregate of whose net turnover of purchases and sales in any assessment year exceeds rupees ten lakh, shall before the expiry of the next succeeding month, submit to the Trade Tax Officer, monthly return of his turnover in Form IV. giving Annexures - I and II thereof, detailed information according to code numbers notified by the State Government from time to time in respect of each category of goods in which he carries on business:

Provided that the return for the month for January shall be submitted to the Trade Tax Officer on or before twenty second February and that of the month of February shall be submitted to the Trade Tax Officer on or before the twentieth day of March:

Provided further that the dealer may instead of submitting a return as aforesaid estimate his turnover for the years on the basis of the turnover admitted by him in the return, or disclosed in his account books whichever is greater, for the immediately preceding year, calculate the amount of tax payable thereon and deposit a sum equal to one twelfth thereof during each of the first two months of every quarter, and deposit the balance of tax due on the turnover admitted by him in his return for the relevant quarter which shall be prepared and submitted in the manner laid down in this rule.

(2) Every dealer liable to pay tax under the Act, other than dealer referred to in sub-rule (1), shall submit to the Assessing Authority for the quarter ending June 30, September 30, December 31 and March 31, within a month of the expiry, of the quarter concerned, a return of his turnover in Form IV giving detailed information in respect of such category of goods in which he carries on business:

Provided that it shall not be necessary for such dealer to furnish in Annexure I and II detailed information according to code numbers in respect of code numbers in respect of goods in which business was carried on by him:

Provided further that a dealer whose total admitted tax liability during the assessment year immediately preceding did not exceed ten thousand rupees or whose estimated admitted tax liability during the assessment year is not likely to exceed ten thousand rupees may, instead of submitting a return as aforesaid, submit on annual return in the manner laid down in this sub-rule, within a month of the expiry of the relevant assessment year.

Explanation I: "Admitted tax liability" means the tax which is payable under this Act on the turnover or, as the case may be, the turnover of purchases or both, as disclosed in the accounts maintained by the dealer or admitted by him in any return or proceeding under this Act, whichever is greater, or, if no accounts are maintained, then according to the estimate of the dealer.

Explanation II: "Estimated admitted tax liability" means the tax payable under the Act by the dealer on his estimated turnover or estimated turnover of purchases of the assessment year or both, as the case may be.

(3) Notwithstanding  anything  contained  in sub-rule (1) or (2) -

(a) a dealer to whom sub-section (2) of section 18 applies, shall submit such return for the quarter or month, as the case may be, in which business is discontinued within fifteen days of the date of such discontinuance;

(b) a dealer to whom sub-section (2) of section 18 applies, shall submit such returns within a month of the expiry of each month during the assessment year in which business is commenced:

Provided  that the return for the month of January shall be submitted on or before twenty-second day of February.

(4) Before submitting the return under sub-rule (1), sub-rule (2) or sub-rule (3), the dealer shall, in the manner laid down in these rules, deposit the total tax due under the Act on the turnover of sale or purchases or both, as the case may be, disclosed in the return and shall submit to the Assessing Authority, alongwith the return the treasury challan, bank draft or cheque for the amount so deposited:

Provided that where a Government Department wants to deposit the tax by book transfer, such department shall, before submitting such return, prepare a bill, in triplicate, for the amount of tax due, endorse it to the Assessing Authority in accordance with the financial rules on the subject and attach two copies thereof with such return. One of the copies shall be retained by the Assessing Authority and the other copy shall be sent to the Accountant General, Uttar Pradesh, for crediting the amount to the account of the Trade Tax Department.

Provided further that in sub rule(1), (2) or (3), the trade tax payable upto 20th March, fourth quarter or for the whole financial year respectively shall be deposited upto 25th March in that financial year.

(5) If in respect of any one or more quarter or month, as the case may be,-

(a) the return is not submitted within the prescribed time, or

(b) the return submitted is, in the opinion of the Assessing Authority, incorrect or incomplete or contains wrong particulars, or

(c) the return is submitted without payment of tax in the manner laid down in these rules,

the Assessing Authority shall, after making such enquiries as it considers necessary, determine the turnover of sales or of purchases or both, as the case may be, and provisionally assess the tax payable thereon.

6) If in respect of any one or more quarter or month, as the case may be-

(a) the tax payable as shown in the return appears to the Assessing Authority to be incorrect, or

(b) the tax paid in the manner laid down in these rules is less than the amount due under the Act, or shown payable in the return,

the Assessing Authority shall provisionally assess the tax payable on the turnover of sales or purchases or both, as the case may be, shown in the return at the rate due under the Act.

(7) Every dealer liable to pay tax shall on or before December 31, submit to the assessing authority, in addition to return filed under sub-rules (1), (2) or (3), as the case may be, a return of his turnover in form ST-XLVII for the preceding assessment year. He shall furnish the portion marked ''original' of all the forms/declarations or certificates on the basis of which exemption or concession from tax is claimed or which determines the nature of a transaction to the assessing authority upto the first date on which he is required to furnish his accounts for final assessment in respect of the assessment year to which the claim relates:

Provided that the assessing authority may, for adequate reasons to be recorded in writing, extend the time for filling such return upto the succeeding March 31.

(8) Upon the expiry of the assessment year, the assessing authority shall, after such enquiry, as he may deem necessary determine the turnover of sales or of purchases, or both, as the case may be, of the dealer in respect of the Assessment year and shall assess the tax payable thereon:

Provided that in the case of a dealer to whom sub-section (1) of section 18 applies or owner or incharge of the vehicle to whom sub-section (1) of section 28-B applies, the assessing authority may make an assessment order and assess the tax payable thereon before the expiry of the assessment year:

Provided further that, before determining the turnover of the dealer to the best of his judgment, the assessing authority shall cause a notice to be served on the dealer, stating the reasons, for non-acceptance of the turnover of sales or purchases or both, as disclosed in the returns, if any, submitted by him and shall give him a reasonable opportunity of furnishing his reply thereto.

(9) If the tax assessed differs from the total amount deposited by the dealer, the difference shall be realised or, as the case may be, refunded by the Assessing Authority in accordance with the provisions of the Act and Rules.

(10) In respect of a dealer, who comes under "Summary Disposal Scheme" or "self-Assessment Scheme" declared by the State Government from time to time, and who does not avail any reliefs/concessions/exemptions against salable forms of the department; the receipt issued by the department for deposit of TT-47 and its enclosures shall be deemed to be the assessment order, if no notice seeking more details or documents or clarification, is received within six months of the receipt thereof;

Provided that this sub-rule shall not apply to an assessment -

(i) of a dealer who has not  deposited "admitted tax" as defined in Section 8(1) of the Act,

(ii) which are in the process of litigation at any level or which are in the process of remand from appellate courts,

(iii) of a dealer who is availing any exemptions/concessions under Sections 4-A, 8(2-A) or 5 of the Act,

(iv) of a dealer against whom evidence  of tax-evasion is available on records of the department."

From a reading of Sections 2(f) and (g) of the U.P.Act, it is absolutely clear that prescribed means prescribed by the U.P.Rules and the assessment year would mean a period of 12 months ending 31st March, i.e., it would cover a period beginning 1st April of that year to 31st March of the succeeding year. Section 7 of the U.P.Act deals with the manner, time and the forms for filing return and assessment.  Sub-section (1) of Section 7 of the U.P.Act enjoins upon every dealer who is liable to pay tax under the U.P.Act, to submit return or returns of his turnover at such interval and within such period, in such forms, verified in such manner, as may be prescribed. The Assessing Authority has been given discretion to extend the date for the submission of the return. Under sub-section (1-A) the dealer has to deposit the amount of tax due on the turnover shown in such return while submitting the return. Sub-section (1-B) provides for payment of interest by the dealer for the period for which the date of return has been extended by the Assessing Authority. Sub-section (1-C) provides for filing of revised return in case any omission or other error is discovered in the return filed by the dealer and takes care of the amount to be deposited/adjusted pursuant to the filing of the revised return. Sub-section (1-D) gives adjustment of goods returned within six months of the date of purchase or sale and provides for filing of a revised return. Sub-section (2) empowers the Assessing Authority to assess the tax on the basis of the return if after making enquiry he is satisfied that the return submitted under the sub-section is correct and complete. Sub-section (3), however, empowers the Assessing Authority to make a best judgment assessment where the return has not been filed or it appears to be incorrect or incomplete. However, before making a best judgment assessment, a reasonable opportunity of proving the correctness and completeness of any return submitted by the dealer is to be afforded to him. Explanation to sub-section (3) clarifies that the turnover for the purposes of various provisions mentioned therein means the turnover of sales or of purchases or both. Sub-section (4) makes the Check Post Officer to be the Assessing Authority in respect of presumption of sales drawn under Section 28-B from where the transit pass has been issued. Under sub-section (5), the provisions of sub-section (4) have been made applicable to all assessment, whether arising before or after the date of commencement of the U.P.Sales Tax (Amendment) Act, 1995. Under sub-section (6), it has been provided that no order of assessment under sub-sections (4) or (5) shall be passed unless the owner or person-in-charge of the vehicle, as the case may be, has been given a reasonable opportunity of being heard. The word ''prescribed' used in sub-section (1) is to be done by the Rules in terms of Section 2(f) of the U.P.Act. The form of return, the period for filing the return as also the manner of verification have been prescribed under Rule 41.

Rule 6 of the U.P.Rules deals with the declaration of the principal place of business by various categories of dealers carrying on business within the State of U.P. and who shall be the Assessing Authority. Sub-rule (1) of Rule 6 of the U.P.Rules provides that if a dealer carries on business within the limits of jurisdiction of only one Trade Tax Officer, that officer shall be the assessing authority in respect of the dealer and the place where he carries on business shall be deemed to be his principal place of business. Sub-rule (2), however, deals with a case where a dealer carries on business within the limits of jurisdiction of more than one Trade Tax Officer. In such a case, the dealer has to declare one of the places of his business as his principal place of business and the Trade Tax Officer having jurisdiction over that principal place of business would be the Assessing Authority. The proviso to sub-rule (2), however, carves out an exception in the case of the department of Central Government or of the State Government or of a Company, Corporation or Undertaking owned or controlled by the Central Government or by a State Government permitting for declaration of more than one places of business as the principal place of business. Sub-rule (3) deals with a case where the principal place of business of a dealer is situated outside U.P. and the dealer carries on business at only one place in U.P. In that event, the Trade Tax Officer within whose territorial jurisdiction the place of business in U.P. is situated shall be the Assessing Authority. Sub-rule (4) takes care of a situation where a dealer situated outside U.P. is carrying on business at more than one place in U.P., then he is required to declare one of his places of business in U.P., as the principal place of business and the Trade Tax Officer having territorial jurisdiction over such principal place of business would alone be treated as the Assessing Authority. Sub-rule (5) empowers the Commissioner or any officer authorized by him to determine the Trade Tax Officer who will be the Assessing Authority in respect of a dealer falling under sub-rule (2) or (4) who has not declared his principal place of business. Sub-rule (6) provides that if a dealer has no fixed place of business, the Trade Tax Officer within whose limits of jurisdiction the dealer ordinarily resides shall be the Assessing Authority.  Sub-rule (6-a) makes the Officer-in-charge of the check post to be the Assessing Authority in respect of the owner or person-in-charge of the vehicle obtaining authorisation for transit of goods from that check post. Sub-rule (7) makes the declaration given by a dealer as final and does not allow any change except with the previous permission of the Commissioner or any officer authorised by him in this behalf, and on such conditions as may be imposed. Sub-rule (8) empowers the Commissioner to determine the Assessing Authority where there is any doubt, or any of the sub-rules do not apply.

Rule 41 of the U.P.Rules deals with the submission of returns and assessment of tax. Under sub-rule (1) a dealer whose net turnover of purchases and sales in any assessment year exceeds rupees ten lakh, is required to submit before the expiry of 25th of next succeeding month a monthly return in Form IV. The first proviso, however, enjoins upon such a dealer to submit the return for the month of January before 22nd February and that of the month of February before 20th of March. The second proviso, however, gives an option to such a dealer. Instead of submitting a monthly return, the dealer can estimate his turnover on the basis of the turnover admitted by him in the return, or disclosed in his account books in respect of the immediately preceding year, whichever may be greater, and calculate the amount of tax payable and deposit one twelfth thereof every month for the first two months of every quarter, and deposit the balance of tax due on the actual turnover alongwith the return to be filed for the relevant quarter. Sub-rule (2) applies to a case where sub-rule (1) is not applicable. It provides for filing of quarterly return ending June 30, September 30, December 31 and March 31 by 25th of the next succeeding month after the expiry of the quarter. The second proviso, however, permits a dealer whose tax liability does not exceed rupees ten thousand to file annual return instead of quarterly return by 25th of April after the expiry of the relevant assessment year. Explanation I defines "Admitted tax liability" whereas Explanation II defines "Estimated admitted tax liability".  Sub-rule (3) provides for filing of return in a case the provisions of Section 18, i.e., reconstituted or new firm, applies. Sub-rule (4) enjoins upon a dealer to deposit the total tax due under the Act alongwith the return. Sub-rule (5) empowers the Assessing Authority to make provisional assessment in cases where in respect of one or more quarter or month, as the case may be, the return is not submitted within the prescribed time, or the return submitted is incorrect or incomplete or contains wrong particulars, or without payment of tax. Sub-rule (6), however, empowers the Assessing Authority to make provisional assessment where the tax payable as shown in the return is incorrect or is less than the amount due under the Act or shown payable in the return. Sub-rule (7) provides for furnishing of certain informations, certificates and declarations. Sub-rule (8) empowers the Assessing Authority to make assessment after the expiry of the assessment year, either on the basis of the return or by best judgment assessment. Sub-rule (9) provides for realising the difference of the total amount of tax assessed and deposited as also for refund. Sub-rule (10) deals with the provision of "Summary Disposal Scheme" or "self-Assessment Scheme".

From a conjoint reading of the aforesaid provision, we find that under Rule 6 of the U.P. Rules, the Trade Tax Officer in whose territorial jurisdiction the dealer's principal place of business is situate, would be the Assessing Authority. The principal place of business once declared cannot be changed except with the permission of the Commissioner or any officer authorised by him. In the present case, the Additional Commissioner who is included in the word "Commissioner", as defined under Section 2(b) of the U.P.Act, has permitted the change of the principal place of business to both the petitioners vide order dated 11.8.2006. It is not in dispute that both the petitioners have filed their returns for the months of April, May and June, 2006 is for the quarter ending 30th June, 2006 in accordance with sub-rule (1) of Rule 41 of the U.P. Rules before the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, within whose territorial limits their principal place of business was situate at that time and who was their Assessing Officer. It is well settled that the proceedings start with the filing of return as held by the Apex Court in the case of Ghanshyamdas v. Regional Assistant Commissioner of Sales Tax and others, (1964) 51 ITR 557, wherein the Apex Court has held that in the case of a registered dealer the proceedings before the Commissioner start factually when a return is made or when a notice is issued to him either under section 10(3) or under section 11(2) of the C.P. and Berar Sales Tax Act, 1947. Section 10(A) of the aforesaid Act is in pari materia with Section 7(1) of the U.P.Act read with Rule 41(1) of the U.P.Rules. The proceedings, therefore, factually started when the petitioner had filed the return for the months of April, May and June, 2006, before the respondent no.1.

Even though under Section 2(j) of the U.P.Act, the assessment year means a period of 12 month ending on March 31, the Officer who was the Assessing Authority prior to the change of the principal place of business of the petitioner, i.e., the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, has jurisdiction to make provisional assessment orders till such time when the principal place of business was changed, as he would be the Assessing Authority of the petitioners till 10.8.2006.

The Apex Court in the case of Commissioner of Income Tax v. Dhadi Sahu, (1993) 199 ITR 610, has held that the general principle is that a law which brings about a change in the forum, does not affect pending actions unless an intention, to the contrary, is clearly shown.

From a reading of Rules 6 and 41 of the U.P. Rules, we do not find that any contrary intention has been shown. The Officer who was the Assessing Authority of the petitioner prior to the date of change of the principal place of business, would continue to have jurisdiction over the petitioner in respect of the matters arising prior to that date, i.e., he will have the jurisdiction to exercise the power under Rule 41(5) of the U.P.Rules for making provisional assessment for the months of April, May and June, 2006. The learned counsel for the petitioner is not right in his submission that if it is permitted then it would mean that for one assessment year there will be two Assessing Authorities who will pass two separate assessment order one for the period 1.4.2006 to 10.8.2006 and the other from 11.8.2006 to 31.3.2007. The passing of the provisional assessment order is provided under Rule 41(5) of the U.P.Rules whereas passing of the assessment orders for the assessment year is to be done under Rule 41(8) of the U.P.Rules which contemplates entirely two different situations. Rule 41(8) would come into play after the assessment year is over and at that point of time that Officer who is the Assessing Authority would make the regular the assessment. The plea of jurisdiction raised by the petitioner, therefore, fails.

The respondent no.1, thus, would be entitled to make provisional assessment under sub-rule (5) of Rule 41 of the U.P.Rules. The circular dated 6.4.2002 issued by the Commissioner, Trade Tax, U.P., Lucknow, is also to the same effect.

Reliance placed by the learned counsel for the petitioner on the decision of this Court in the case of M/s Mercury Laboratories Pvt. Ltd. (supra) is misplaced. In the aforesaid case, this Court has held that the Commissioner cannot issue such direction or instructions or guidelines which have the overriding effect on the notification and he has no authority otherwise to guide the subordinates by his own personal views in the matter of taxation or exemptions under the notification. In the present case, as discussed hereinbefore, the Commissioner, Trade Tax, U.P., Lucknow, in his circular dated 6.4.2002 has only clarified the legal position with which we fully agree. Thus, by the aforesaid circular, he has not imposed his personal views upon his subordinate authorities.

As we have already come to the conclusion that the Deputy Commissioner (Assessment) - II, Trade Tax, Meerut, respondent no.1, had the jurisdiction to issue notices under Rule 41(5) of the U.P.Rules and to pass consequential provisional assessment orders for the months of April, May and June, 2006, we do not find any merit in these petitions. No other point has been pressed. Both the writ petitions fail and are dismissed in limine.

27.9.2006

vkp


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

Advertisement

dwi Attorney | dui attorney | dwi | dui | austin attorney | san diego attorney | houston attorney | california attorney | washington attorney | minnesota attorney | dallas attorney | alaska attorney | los angeles attorney | dwi | dui | colorado attorney | new york attorney | new jersey attorney | san francisco attorney | seattle attorney | florida attorney | attorney | london lawyer | lawyer michigan | law firm |

Tip:
Double Click on any word for its dictionary meaning or to get reference material on it.