Case: Gurbaksh Singh Vs. Union Of India &amp; Others

In these appeals by certificate the question for determination is whether the exercise of the power of revision under sub-section (3) of section 20 of the Bengal Finance (Sales Tax) Act, 1941, as extended to the Union Territory of Delhi - hereinafter called the Act - is subject to the period of limitation provided in sub-section (2a) of section 11 or section 11-A of the said Act. The requisite facts lie in a narrow compass and may usefully be stated at the outsetThe appellant who was carrying on the business of execution of building contracts was assessed to sales tax under the Act by the Sales Tax Officer for the year 1955-56 by an order of assessment made on November 23, 1959. The appellants appeal before the Assistant Commissioner of Sales Tax succeeded in part. He held that the assessment for the first two quarters of the year 1955-56 was invalid having been made out of time. The case was, therefore, remanded to the Sales Tax Officer for a fresh assessment in respect of the 3rd and 4th quarters of the year. The Sales Tax Officer in pursuance of the appellate order of remand dated February 11, 1960, passed a fresh assessment order on March 21, 1960. The Commissioner, however, after notice dated July 21, 1960, to the appellant, by his order dated July 29, 1960, revised the appellate order of the Assistant Commissioner in exercise of his power under section 20(3) of the Act. He held that no part of the assessment for the year 1955-56 was barred and directed a fresh assessment to be made. A fresh assessment for all the four quarters was accordingly made by the Sales Tax Officer on September 24, 1960. The appellant filed two writ petitions in the Delhi High Court challenging the order made in revision by the Commissioner and the fresh assessment order passed by the Sales Tax Officer in pursuance thereof. A learned single Judge of the High Court allowed the writ applications on April 2, 1969, and quashed the impugned orders. The respondents took up the matter in letters patent appeal and succeeded before a Bench of the High Court. Hence these appeals by the assessees.

Reasoning:
The third point urged by the appellant is too obviously wrong to merit any detailed discussion. It was not the Commissioner who had passed the assessment order under section 11. That order was of the Sales Tax Officer acting as an officer to assist the Commissioner for the purpose of assessment. The assessment order was interfered with by the appellate authority, the Assistant Commissioner, and the Commissioner was revising the order of the Assistant Commissioner. All cannot be treated as Commissioners for the purpose of the different powers exercised by the three different authorities. The use of the term "Commissioner" in the sections is merely for the purpose of describing and, at any rate, including the officer assisting the Commissioner as CommissionerApropos the fourth and last submission of the appellant, suffice it to say that even assuming that the revisional power cannot be exercised suo motu after an unduly long delay, on the facts of this case it is plain that it was not so done. Within a few months of the passing of the appellate order by the Assistant Commissioner, the Commissioner proceeded to revise and revised the said order. There was no undue or unreasonable delay made by the commissioner. It may be stated here that an appeal has to be filed by an assessee within the prescribed time and so also a time-limit has been prescribed for the assessee to move in revision. The appellate or the revisional powers in an appeal or revision filed by an assessee can be exercised in due course. No time-limit has been prescribed for it. It may well be that for an exercise of the suo motu power of revision also, the revisional authority has to initiate the proceeding within a reasonable time. Any unreasonable delay in exercise may affect its validity. What is a reasonable time, however, will depend upon the facts of each caseIn the present case, in view of the proviso added to section 11(2a) the anomaly flows in the reverse direction. If the appellate or the revisional authority made a remand order, the assessing authority could pass a fresh order of assessment within 4 years of such order. But if the higher authority itself revised the assessment then it would be barred by the rule of limitation provided in section 11(2a).To avoid such an anomaly Mr. Nariman suggested a construction to be put which neither solves the anomaly nor is warranted by the language of the provisions of the Act. Counsel submitted that in all cases the powers must be exercised within 4 years of the period in respect of which an assessment was being made on a registered. It will be wholly unreasonablealmost impossibleto say that all orders in appeal, revision or reference must be passed within four years of the end of the period of assessment, otherwise they will be barred. It does not solve the anomaly either. Even if the order of remand is made, say, just on the last day of the period of four years, it will be competent to the assessing authority to make a fresh assessment within the further period of four years. The ratio of the case in Debaki Debis [[1964] 15 S.T.C. 153 (S.C.)] must be confined within its four corners and can not be extended to the facts of the instant case.In Swastik Oil Mills Ltd. v. H. B. Munshi, Deputy Commissioner of Sales Tax, Bombay [[1968] 21 S.T.C. 383 (S.C.)], the decision of this court in Debaki Debis case [[1964] 15 S.T.C. 153 (S.C.)] was distinguished on the ground that the provision of limitation of 36 months in substance was not a real proviso to the section in which it was placed but was in fact a period of limitation for all orders of assessment made under any other provision of the Orissa Act, while in the Bombay Act there was no such general provision prescribing a period of limitation for making an assessment. Reference to the period of limitation in sectionA of the Bombay Act, which is a power of making assessment or reassessment in case of an escaped ord assessment was also rejected. Our attention was also drawn to the decision of a single Judge of the Punjab High Court, Delhi Bench, in Sir Sobha Singh & Company v. Commissioner of Sales Tax, Delhi [[1966] 18 S.T.C. 416], wherein following the decision of this court in Debaki Debis case [[1964] 15 S.T.C. 153 (S.C.)], it was held that an order of review made by the Commissioner under section 20(4) of the Act in effect is an order of assessment under section 11(1) and cannot be made after the expiry of the period prescribed under section 11(2a). The learned Judge in the course of his judgment made it clear that he was concerned with the construction of the Act as it stood before 1959 and was not obliged to consider the effect of the proviso added to section 11(2a) in 1959. It is not necessary to decide in this case whether without the aid of the proviso aforesaid the decision of the learned single Judge was correct or not, but surely in the fact of the proviso it cannot hold good.