1 S.B. Sales Tax Revision Petition No. 38/2008 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Sales Tax Revision Petition No. 38/2008 Assistant Commercial Taxes Officer, Jaipur Vs. M/s. Urvashi Exports, Jaipur. Date of Judgment: 22.10.2010 REPORTABLE Hon'ble Mr. Narendra Kumar Jain,J. Mr. R.B. Mathur with Mr. A. Kaushik, for the petitioner. Mr. Alkesh Sharma, for the respondent. BY THE COURT: Heard learned counsel for the parties. 2. This revision petition is directed against judgment dated 04.03.2005 passed by Rajasthan Tax Board, Ajmer in Appeal No. 162/2004/Jaipur whereby the appeal filed by the respondent-assessee has been allowed. 3. Briefly stated the facts of the case are that assessee/respondent filed an application alongwith composition fees of Rs. 7,000/- for issuance of composition certificate for the period 1999-2000 under the provisions of “Composition Scheme for Registered Dealers Dealing in All Kinds of Precious and Semi- 2 S.B. Sales Tax Revision Petition No. 38/2008 precious and Synthetic Gems and Stones-1999” issued vide Notification dated 30.04.1999. Assessing officer vide its order dated 20.10.1999 allowed the application and passed an order for issuance of composition certificate for a period of one year. 4. Assessee did not move an application for renewal of composition certificate for subsequent years, therefore, assessing authority vide its order dated 28.12.2001 passed an assessment order for the year 2000-2001 levying composition amount of Rs. 7,350/- and interest of Rs. 2,940/- total Rs. 10,290/- and issued a demand notice and another assessment order dated 28.12.2001 for the year 2001-2002 levying composition amount of Rs. 7,718/- and interest Rs. 1,235/- and raised a demand of Rs. 8,953/-. 5. Being aggrieved with the aforesaid orders, assessee filed two separate appeals, but the same were dismissed vide order dated 29.10.2003 by Additional Commissioner(Appeals). Thereafter, assessee preferred two appeals, which were allowed by Rajasthan Tax Board, Ajmer vide impugned judgment dated 04.03.2005. Being aggrieved with the same assessing authority has preferred two revision petitions i.e. present S.B. Sales Tax Revision Petition No. 38/2008 for the year 2000-2001 and another S.B. Sales Tax 3 S.B. Sales Tax Revision Petition No. 38/2008 Revision Petition No. 37/2008 for the year 2001- 2002. 6. It is relevant to mention that so far as S.B. Sales Tax Revision Petition No. 37/2008 is concerned the same had already been dismissed by this Court for non-prosecution way back on 21.07.2008. 7. Submission of learned counsel for the Revenue, Mr. R.B. Mathur, is that the benefit of composition scheme is given to a dealer initially for a period of five years, therefore, even if composition certificate was not issued for a period of five years and the same was issued for a period of one year then also, assessee was liable to pay the composition amount/tax for subsequent years. 8. Learned counsel for the assessee contended that as and when an application is filed under composition scheme then it is the duty of the assessing officer to issue a certificate for five years. However, in the present case, assessing officer did not think it fit and proper to issue a composition certificate for five years but it was issued only for a period of one year. Subsequently, there was no sale of the assessee firm, therefore, neither any application for renewal of the composition certificate was filed nor it 4 S.B. Sales Tax Revision Petition No. 38/2008 was renewed by the assessing officer. In these circumstances, there was no justification for raising a demand of composition amount/tax from the assessee for subsequent years during which there was no sale and particularly when composition certificate was not renewed. 9. I have considered the submissions of learned counsel for the parties in the light of reasons assigned by Tax Board for setting aside assessment order passed by assessing officer. There is no dispute in between the parties that assessee applied for composition certificate under Notification dated 30.04.1999 and assessment authority passed an order to issue a certificate for one year i.e. up to 31.03.2000. It is not in dispute that neither any application for renewal of the composition certificate was filed by assessee nor any composition fees was deposited for subsequent years; nor assessment authority passed an order for renewal of the composition certificate of the assessee for subsequent years i.e. 2000-2001 and 2001-2002. A bare perusal of assessment order dated 28.12.2001 will show that assessment order was passed without notice and an opportunity of hearing to assessee. It was mentioned in the order that assessee has not filed an application for renewal of the 5 S.B. Sales Tax Revision Petition No. 38/2008 certificate nor he has deposited the composition fees, therefore, assessment order is passed. Additional Commissioner(Appeals) while dismissing the appeal of the assessee observed that neither any application as per Clause 4 of the Scheme was filed nor any application under Clause 9 of the Scheme was filed for voluntarily withdrawal from the Scheme, therefore, assessing authority was justified in passing the assessment order. 10. Rajasthan Tax Board in its impugned judgment considered the matter thoroughly and by speaking and well reasoned order allowed the appeal of the assessee. Tax Board observed that as per Clause 2 of the Scheme the composition certificate should have been issued for a period of five years but assessing officer issued the certificate for a period of one year only. Said certificate expired on 31.03.2000. Thereafter neither any application was filed for renewal of the certificate nor any fees was deposited, nor certificate was issued, therefore, composition scheme was not in force and applicable on the assessee. If the composition certificate would have been issued for a period of five years then only Clauses 4 and 9 of the Composition Scheme would have been made applicable and it would have been necessary for the assessee to move an 6 S.B. Sales Tax Revision Petition No. 38/2008 application for voluntarily withdrawal from the Composition Scheme. Since certificate itself was issued for a period of one year and it was not effective thereafter, therefore, there was no need of any application to be moved by assessee under clauses 4 and 9 of the Composition Scheme. As per provisions of Composition Scheme, application for renewal was to be moved within a period of 30 days, but the same was not moved. Assessee submitted his regular annual return in Form 5B. Assessee closed his business and informed about the same to the assessing officer. This fact has not been disputed by learned counsel for Revenue also. 11. I have examined the provisions of Composition Scheme 1999 and find that reasons assigned by the Tax Board for setting aside the orders passed by assessing officer as well as Additional Commissioner(Appeals) are absolutely legal and justified and I do not find any justified reason for interference in the order passed by Rajasthan Tax Board. Assessee had already filed his annual return for subsequent years. It was assessing officer, who issued composition certificate only for a period of one year and not for five years, therefore, filing of application for withdrawal from the scheme 7 S.B. Sales Tax Revision Petition No. 38/2008 was not necessary. Since regular return was filed after 31.03.2000, business of assessee was closed and an information in this regard was given and period of composition certificate had already been expired on 31.03.2000, therefore, no liability had accrued under the scheme against assessee for subsequent years, for which no certificate was issued by the assessing officer. 12. In view of above discussions, I do not find any merit in the revision petition and the same, is accordingly, dismissed with no order as to costs. (Narendra Kumar Jain),J. Manoj, Item No.S.1.