Case: State Of Punjab Vs. Sant Singh Kanwarjit Singh

1. Sant Singh Kanwarjit Singh - hereinafter called the assessee - is registered as a dealer under the Punjab General Sales Tax Act 1948. The assessee filed returns of the turnover of its business for the quarters ending 30th June, 1962 and 30th September, 1962, but without appending thereto the list of sales to registered dealers as required by R. 30 framed under the Act. The Sales-tax Officer proceeded to make "ex parte assessments" for the two quarters.2. The assessee then moved a petition in the High Court of Punjab for a writ quashing the orders of assessment. A single Judge following the Judgment of the Punjab High Court in Mansa Ram Sushil Kumar v. Assessing Authority, Ludhiana, 1964-15 STC 857   (Punj), quashed the orders of assessment. An appeal by the State of Punjab was summarily dismissed by a Division Bench of the High Court.

Reasoning:
5. The scheme is plain. A registered dealer must file return of the turnover in the manner prescribed and at such intervals as may be prescribed. The dealer while submitting the return has also to pay tax according to the return. The Assessing Officer may accept the return or he may call upon the tax payer to explain the turnover, and support it by evidence.6. Under the Act sales-tax is an yearly tax, but the provisions relating to assessment contemplate assessments for periods shorter than a complete year, and for that purpose the tax payers are required by the Act to submit periodical returns of their turnover and to pay tax duereaching that conclusion the High Court relied upon the Judgment of this Court in M/s. Mathra Parshad and Sons v. State of Punjab, (1962) Suppl (1) SCR 913   = (AIR 1962 SC 745  ). But in Mathra Parshads case (1962) Supp (1) SCR 913 = (AIR 1962 SC 745  ) this Court considered whether an exemption granted by the State Government during the course of the year was applicable to the whole or only a part of the year of assessment. This Court held (Mr. Justice Kapur dissenting) that the exemption operated for the entire financial year. The Court observed that the tax was an yearly tax levied on the taxable turnover of a dealer for the year; it was collected in some cases quarterly, some cases yearly and proceeded to hold that whenever the exemption came in, in the year for which the tax was payable, it exempted sales throughout the year unless notification fixed the date of commencement of the tax. In our judgment the principal of that case has no bearing on the question arising in this case. The Court in Mathra Parshads case, 1962 Supp (1) SCR 913 = (AIR 1962 SC 745  ) merely emphasised that the tax was an annual tax but that did not imply that assessment of tax quarterly was illegal. Adjustment may possibly have to be made when the assessment of the final quarter is made, but the taxing authorities are not debarred from determining and assessing the quarterly turnover of tax. Mansa Rams case, (1964) 15 STC 857 (Punj) has since been overruled by a Full Bench of the Punjab High Court in Om Prakash Rajinder Kumar v. K. K. Opal, ILR (1967) 1 Punj 115 = (AIR 1967 Punj 464) (FB). The Court in that case held that Sales tax may be assessed under Section 11 of the Act on the basis of quarterly returns submitted by the dealer pursuant to the notice served on him under Section 10 (3) before the close of the relevant financial year.