Case: Commissioner Of Sales Tax, Madhya Pradesh Vs. M/S. Amarnath Ajitkumar Of Bhind, Madhyapradesh

3. The assessee, M/s. Amarnath Ajit Kumar was a registered dealer under the Madhya Bharat Sales Tax Act, Samv. 2007, For the period from July 1, 1957 to 31st March, 1958 the period with which we are concerned in this appeal, the assessee submitted its return for the second and third quarters on January 30, 1958 and for the fourth quarter on 17th June 1958. These returns were made under Section 9 (3) ofthe Central Sales Tax Act, 1956. The sales tax concerned in the present case was that leviable underthe Central Sales Tax Act, 1956. But the procedure to be adopted in the matter of assessment and collection was that prescribed in the Madhya Bharat Sales Tax Act, Samv. 2007. The Madhya Bharat Act was repealed by the Madhya Pradesh General Sales Tax Act, 1959, which came into force on April 1, 1959. Thereafter the Assistant Commissioner of Sales Tax, issued a notice in form XI of the Madhya Pradesh Sales Tax (Central) Rules, 1959 on August 29, 1961. That Officer passed the assessment order on November 28, 1961. On October 30, 1964, the Commissioner of Sales Tax initiated proceedings under Sect. 39 (2) of M. P. Sales Tax Act, 1959 for revising the assessment made. After notice to the dealer the Commissioner on April 15, 1965 revised the assessment and enhanced the same by a sum of Rupees 993.06 paise. The assessees appeal to the Board of Revenue was dismissed on June 20, 1966. Both before the Commissioner as well as the Board of Revenue, the assessee contended that as the assessment related to the period when Madhya Bharat Sales Tax Act, Samv. 2007 was in force, the revision of that assessment is governed by Section 12 (1) of that Act and not Section 39 (2) of the Madhya Pradesh Act, 1959. It was urged on its behalf that under the Madhya Bharat Act, the Commissioner could not have revised the order of assessment after the expiry of two years after the assessment was made. Hence the Commissioner was not competent to revise the assessment. The Commissioner as well as the Board of Revenue rejected that contention. They came to the conclusion that it was open to the Commissioner to take action under Sec. 39 (2) of the M. P. General Sales Tax Act, 1959 in the matter of revising the assessment. The High Court did not agree with that view. It held that in view of Section 52 of the 1959 Act, the governing provision in the matter of revising the assessment was Section 12 (1) of the Madhya Bharat Act.

Court's reasoning:
10. Agreeing with the High Court this Court held in Hanuman Prasads case, 19 STC 87  = (AIR 1967 SC 565 ) that the Commissioner could not have revised the order of assessment after the period prescribed in the repealed Act. One of the reasons given in support of that conclusion is that "the rights and liabilities, which had been acquired or incurred under the repealed Act, included the right or liability to be assessed in accordance with the provisions of the repealed Act, in respect of turnover of sales effected during the time when that Act was in force." The expression assessment includesis true, as urged by Mr. Desai in the alternative, that, in fact, the proceedings should have been taken not under Section 31 of the Act of 1953, but under Section 22 of the Act of 1946. That is so, because, when the Act of 1946 was repealed by the Act of 1953, similar provisions were made in the Act of 1953 to continue in force the provisions of the Act of 1946 in respect of rights and liabilities which may have accrued or have been incurred under the Act of 1946. Section 48 (2) and Section 49 (1) clearly contained provisions indicating that, in respect of a liability to tax under the Act of 1946, the rights and liabilities of the assessee had to be determined in accordance with the provisions of the Act of 1946 and all legal proceedings or remedies in respect thereof had also to be taken under the same Act. Consequently the Deputy Commissioner in seeking to exercise revisional powers against the order of the Assistant Collector passed under the Act of 1946, had to proceed under Section 22 of the Act of 1946. That, however is not at all material, because the provisions of Section 22 of the Act of 1946 are quite similar to those of Section 31 of the Act of 1953. The mere incorrect mention of Section 31 of the act of 1953 in the notice is immaterial. The Deputy Commissioner has the jurisdiction and power to revise the order under the Section 22 of the Act of 1946 and, consequently the proceedings initiated by him are not without jurisdiction.Now coming back to Section 52 of the M. P. Sales Tax Act of 1959 , the proviso to Section 52 (1) provides that the repeal of the Madhya Bharat Act shall not affect any right already acquired or accrued thereunder. The question is whether the bar on the power of the Commissioner from exercising the powers under Section 12 (1) of the Madhya Bharat Act after the prescribed period did create a right in favour of the assessee? The effect of that provision is that after the time prescribed in that provision, the Commissioner could not revise the order of assessment to the prejudice of the assessee. Similarly he could not revise the order of assessment to the prejudice of the Revenue. Section 12 (1) conferred a right both on the assessee as well as on the Department to see that an order of assessment is not revised to their prejudice after a particular date. We fail to see why Section 12 (1) of the Madhya Bharat Act should not be considered as conferring on the assessee a right to see that the assessment made against him is not altered to his prejudice after a particular date. That is a valuable right. The effect of Section 52 (1) of M. P. Sales Tax Act, as seen earlier is that all assessments, which include reassessments should be in accordance with the repealed Act.13. The second part of the that proviso says that subject to what has been provided in the first part of the proviso, anything done or any action taken including an order in the exercise of any of the powers conferred by or under the repealed Act, shall in so far as it is not inconsistent with the provisions of the M. P. Sales Tax Act, 1959 be deemed to have been done in the exercise of powers conferred by or under that Act as if that Act were in force on the date on which such thing was done. There is undoubtedly a conflict between Section 12 (1) of the Madhya Bharat Act and Section 39(2) of the M. P. Sales Tax Act. 1959. The former provision prohibits the Commissioner from revising an order which has been made more than two years previously and the latter provision permits him to revise the order till the expiry of three years from the date of the order sought to be revised. Therefore the Revenue cannot call into aid the second part of the proviso. The resulting position is that the governing provision would continue to be Section 12 (1) of the Madhya Bharat Act.From the second proviso, it is clear that the Commissioner is precluded from revising an order which had been made more than two years previously. That proviso did not lay down any rule of limitation. But it took away the power of the Commissioner to revise any assessment after the prescribed period. Thereafter the assessment became final and conclusive as against the Department as well as the assessee, unless it was liable to be changed under some other provision of the Madhya Bharat Act.