Punjab-Haryana High Court
Assistant Excise And Taxation ... vs Gopal Oil Mills And Anr. on 26 October, 1994
Equivalent citations: (1995)109PLR447
Author: S.P. Kurdukar
Bench: S.P. Kurdukar
JUDGMENT S.P. Kurdukar, C.J.
1. Letters Patent Appeals Nos. 463 and 595 of 1984 are directed against the judgments and orders dated March 15, 1984 and March 22, 1984 respectively passed by the learned Single Judge. These two appeals are preferred by the State of Punjab challenging the legality and correctness of judgments and orders passed by the learned Single Judge. After hearing learned counsel for the parties and after getting necessary facts from them, we are of the opinion that since the issues involved in both these appeals are identical, although the judgment is not common, the same can be disposed of by this common judgment. For the purpose of disposal of these appeals, we may refer to the facts in L.P.A. No. 463 of 1984.
2. It is un-necessary to set out the facts in detail in as much as there is no dispute about most of the facts. The learned Single Judge in his judgments has very succintly set out the facts. The learned Single Judge also formulated the questions of law which arose in both the writ petitions. We heard the learned counsel for the parties on the issues raised by the learned Single Judge in his judgments. The answers to the questions formulated in Appeal No. 463 of 1984 squarely answer the controversy raised in Appeal No. 595 of 1984.
3. There does not seem to be any dispute that the respondent- M/s Gopal Oil Mills, Samrala, was a registered firm and was engaged in the business of sale and purchase of oil seeds and manufacture of oil and its bye-rproducts. Being the registered dealer within the meaning of the Punjab General Sales Tax Act, 1948 (for short the Act) and also under the General Sales Tax Act, for the assessment year 1970-71, respondent had admittedly filed quarterly returns in Form ST-VIII disclosing a turn-over pertaining to its sales and accordingly paid sales-tax thereon. It is also admitted position that the respondent had not filed any return as regards the purchases made by it during the year 1970-71 in form ST-VIII-A of the Act and resultantly did not pay the tax thereon. It is in these circumstances that the assessment for the year 1970-71 on various purchases made by respondent was sought to be made in the year 1978. Some orders were passed by the authorities below and the last order which went against the respondent was passed by the Assistant Excise & Taxation Commissioner (Inspection), Ludhiana, on March 5,1981. The Assistant Excise & Taxation Commissioner with the aid of Section 11(2) of the Act held that the respondent being the last purchaser was liable to pay tax under Section 5(3) of the Act. The Assistant Excise & Taxation Commissioner appears to have exercised the power under Section 21(1) of the Act. This order was sought to be challenged in a writ petition by the respondent and the learned Single Judge vide his judgment and order dated March 15, 1984 set-aside and held that the appellant can not take benefit of Section 11(2) of the Act.
4. The learned Single Judge has very appropriately formulated the points and held that the Assistant Excise & Taxation Commissioner in exercise of his revisional powers under Section 21(1) of the Act, cannot make an order of purchase tax after the expiry of five years period. The learned Single Judge opined that more appropriately the provisions of Section 11(5) will be attracted and not of Section 11(2) of the Act. It is in these circumstances that the learned Single Judge granted the desired relief to the respondent in its writ petition.
5. Mr. Aggarwal, learned Additional Advocate General, took us through the judgment of the learned Single Judge as well as the judgments of authorities below and the relevant record. Mr. Aggarwal urged that assuming that respondent did not file the purchase returns in Form VIII-A of the Act, yet by virtue of his own admission contained in affidavit filed in the year 1976, the department was justified in invoking the provisions of Section 11(2) of the Act. Counsel urged that in the facts and circumstances of the case, affidavit of respondent and other material of the sellers through whom the respondent purchased the goods, sufficiently indicate that respondent was liable to pay purchase tax on the purchases made during the year 1970-71. He also tried to support his argument taking recourse to various entries reflected in the accounts books to show the purchases. Mr. Aggarwal, therefore, urged that this is a fit case where the learned Single Judge ought to have held that the case of the respondent more appropriately falls under Section 11(2) and not 11(5) of the Act. Learned counsel then urged that there is no limitation prescribed under Section 11(2) of the Act and if this be so, the revisional authority - Commissioner was perfectly justified in levying the purchase tax in exercise of powers under Section 21(1) of the Act.
6. In order to appreciate the contentions of Mr. Aggarwal, it would be relevant to set out Section 11(2) and 11(5) of the Act. It reads thus :-
"11(1) XX XX (2) If the Assessing Authority is not satisfied without requiring the presence of dealer who furnished the returns or production of evidence that the returns furnished in respect of any period are correct and complete, he shall serve on such dealer a notice in the prescribed manner requiring him, on a date and place specified therein, either to attend in person or to produce or cause to be produced any evidence on which such dealer may rely in support of such returns.
(3) XX XX (4) XX XX
(5) If a dealer does not furnish returns in respect of any period by the prescribed date, the Assessing Authority shall, within five years after the expiry of such period, after giving the dealer a reasonably opportunity of being heard, proceed to assess to the best of his judgment, the amount of tax, if any, due from the dealer."
7. The scheme of Section 11 is quite clear and it postulates two situations where action could be taken against the evasion of sales tax or purchase tax. Bare reading of Section 11(2) would make it clear that if the Assessing Authority upon applying its mind to the returns filed by the assessee is not satisfied without requiring the presence of dealer who furnished the returns or production of evidence in support thereof, in that eventuality he shall serve on such dealer a notice in the prescribed manner requiring him, on a date and place specified therein, either to attend in person or to produce or cause to be produced any evidence on which such dealer may rely in support of such returns. The Assessing Authority, if not satisfied with the returns filed by the dealer, may issue a notice in the prescribed manner requiring the assessee through its dealer to do certain things. As indicated earlier, in the present case the assessee did not file the returns of purchases made by it in Form VIII-A and only after the expiry of five years period on the basis of affidavit and some other material a notice was issued to the respondent.
8. As against this, Mr. Jhingan, learned counsel appearing on behalf of respondent strongly relied upon Section 11(5) of the Act to contend that if the dealer has failed to furnish the returns in respect of any period before the prescribed date, then the Assessing Authority has to issue notice within five years after the expiry of such period. Admittedly, no such notice was issued to the respondent within five years after the expiry of the period i.e. March 31,1971. Mr. Jhingan, therefore, urged that the learned Single Judge was right in holding that the facts of the present case squarely fall under Section 11(5) and not 11(2) of the Act.
9. After hearing learned counsel for the parties and on going through the impugned judgments, we are of the considered opinion that the learned Single Judge has rightly held that the revisional jurisdiction could not have been exercised by the Assistant Excise & Taxation Commissioner by taking recourse to Section 11(2) of the Act. There is no substance in both these appeals. Both these appeals stand dismissed but in the circumstances of the case, there shall no order as to costs.