HON’BLE SRI JUSTICE GODA RAGHURAM AND HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA Writ Petition No.19961 of 2011 Date: 09-8-2011 Between M/s. Mayuri Film Distributors, Hyderabad-16, Rep. by its Vice President Mr. G.Sudhakar … Petitioner and Commercial Tax Officer, Vanasthalipuram Circle, Hyderabad … Respondent HON’BLE SRI JUSTICE GODA RAGHURAM AND HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA Writ Petition No.19961 of 2011 Order: (per Goda Raghuram, J.) Heard Sri S.Dwarakanath, learned counsel for the petitioner and the learned Special Government Pleader for Commercial Taxes for the respondent. 2. The order of reassessment dated 09-3-2011 in Assessment No.22615/2003-04 (CST) passed by the respondent for the assessment year 2003-04 under the Central Sales Tax Act, 1956 (‘the CST Act’ for short) is challenged as without jurisdiction, barred by limitation and for being in violation of the principles of natural justice. 3. Earlier, by the orders dated 24-3-2007 the respondent passed an order of assessment accepting the “F” Forms furnished by the petitioner-assessee claiming exemption on Inter State Stock Transfers amounting to Rs.86,36,244/- and thereupon made the final assessment for the year in question and determined the balance tax due, which was paid. Thereafter, after issuing a notice (a fact disputed by the petitioner i.e. as regards the receipt of notice) the respondent passed the impugned order of revised assessment dated 09-3-2011. This order states that on verification of “F” Forms earlier submitted by the assessee, it was found that 21 of the “F” Forms covering the amount of Rs.36,71,715/- cover a period of more than one month; according to Section 6A of the CST Act read with Rule 12(5) of the Central Sales Tax (R & T) Rules, 1957 the declaration in Form “F” in support of consignment sales made by the dealers should be furnished to the Assessing Authority such as that a single “F” Form for covering transaction affected during a period of one calendar month; that in view of the aforesaid Rule provision, “F” Forms were not valid and the transactions are to be treated as Inter State Sales covered by CST Sales turnover and are liable to be brought to tax. Accordingly, a revised tax liability of Rs.4,35,837/- was determined with the consequences that a revised demand notice is liable to be issued. 4. The petitioner challenges the revised assessment order on the ground the condition precedent for reopening the assessment under Section 14(4) of the Andhra Pradesh General Sales Tax Act, 1957 is that there should be material outside the record that must come to the notice of the authority. Reliance is placed on the judgment in GIRDHARLAL & COMPANY v. STATE OF A.P. (A.P.)[1], wherein the following principle has been spelt out: “The criterion to judge whether there has been a reasonable exercise of power under the said provision is not whether there was lack of diligence but whether there was lack of material at the time of assessment that necessitated exercise of the power. If necessary material was available on record but the assessing authorities had not adverted to relevant aspect due to lack of diligence, it would not afford a ground to the assessing authority or his successor to exercise power under section 14(4), but if the record did not contain the relevant material which comes to the notice of the authority from other sources after the assessment then it would afford a justifiable ground to exercise power under that section. In other words, for the exercise of power under section 14(4), reliance should be made not on the material on record but on the material de hors the record which came to the notice of the assessing authority subsequent to the assessment. In short, non-application of mind by the assessing authority to the material on record at the time of assessment, is not a justifiable ground to invoke power under section 14(4) of the Act. The same view is taken by a Division Bench of this Court in State of Andhra Pradesh v. Kedia Vanaspati (P) Ltd. [1994] 95 STC 208 to which one of us (Syed Shah Mohammad Quadri, J.) was a party. To the same effect is the pronouncement in State of Andhra Pradesh v. Ratna Sree Box Makers [1989] 75 STC 82 (AP).” 5. Sri P.Balaji Varma, learned Special Government Pleader for Commercial Taxes, fairly states that there was no fresh material which was not already on record, on the basis of which the revised assessment has been made. 6. In the facts and circumstances and in the light of the law declared in GIRDHARLAL & COMPANY’s case (1 supra), the impugned order of reassessment dated 09-3-2011 passed by the respondent for the assessment year 2003-04 cannot be sustained and is accordingly quashed. 7. Accordingly, the writ petition is disposed of at the stage of admission. There shall, however, be no order as to costs. __________________________ GODA RAGHURAM, J. __________________________ ASHUTOSH MOHUNTA, J. 09th August, 2011. Ak HON’BLE SRI JUSTICE GODA RAGHURAM AND HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA Writ Petition No.19961 of 2011 (Order of the Division Bench delivered by GR, J.) 09th August, 2011. (Ak) [1] 1997 STC 442