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The State of Andhra Pradesh Vs. Sri Sitharamanjaneya Rice, Groundnut and Flour Mill - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtAndhra Pradesh High Court
Decided On
Case Number Tax Revision Case No. 7 of 1960
Judge
Reported in[1962]13STC31(AP)
AppellantThe State of Andhra Pradesh
RespondentSri Sitharamanjaneya Rice, Groundnut and Flour Mill
Appellant Advocate The Third Government Pleader
Respondent Advocate T. Anantha Babu and ; G. Ramanujulu Naidu, Advs.
DispositionRevision dismissed
Excerpt:
.....large scale, and consequently he rejected the turnovers for the months of april to september, 1955, and october to december, 1955, and best judgment turnover was determined. 14,469-2-0. before the tribunal the assessee challenged the additional assessment as well as the disallowance of the rebate to which he was entitled under rule 18. with respect to the first point the tribunal held that there was a clear suppression by the assessee and confirmed the assessment. this judgment would indicate that once the conditions prescribed in the rule are satisfied, the assessee would be entitled to the rebate even if it is for a subsequent period......entitled to a deduction under clause (k) of sub-rule (1) of rule 5. thirdly, under sub-rule (3) of rule 18, a manufacturer so registered must submit to the registering authority not later than the 25th of every month a statement in form a-g in relation to transactions relating to the previous month. if a manufacturer does not submit his statement in form a-g by the 25th of the month, the commercial tax officer has been given discretion to condone the delay provided such a manufacturer has maintained a true and correct account of his business showing all the particulars required by sub-rule (3). it is the proviso to sub-rule (3-a) that is sought to be pressed into service by the learned government pleader as vesting a discretion in the commercial tax officer to reject the rebate. in our.....
Judgment:
ORDER

Jaganmohan Reddy, J.

1. This tax revision case is by the State of Andhra Pradesh against the order of the Tribunal setting aside the order of the assessing officer and of the first appellate authority and remanding the case for allowing rebate to the assessee under Rule 18 of the Madras General Sales Tax (Turnover and Assessment) Rules, (hereinafter called the Rules).

2. The assessee, a manufacturer of groundnut oil registered under Rule 18 of the Rules for the year 1955-56, was submitting his monthly returns and claiming rebates on purchases of groundnut as provided under Sub-rule (2) of that rule. During the period of assessment on nth February, 1956, the Commercial Tax Officer, Visakhapatnam, recovered on a surprise inspection made by him some books of account disclosing clandestine transactions on a large scale, and consequently he rejected the turnovers for the months of April to September, 1955, and October to December, 1955, and best judgment turnover was determined. The rebate to which the assessee was entitled under Rule 18 was also rejected. A sum of Rs. 3,47,242-7-0 was added by the assessing authority to the turnover disclosed by the assessee. In appeal, the Deputy Commissioner maintained this order and assessed the assessee on a turnover of Rs. 9,26,023-8-3 levying a tax of Rs. 14,469-2-0. Before the Tribunal the assessee challenged the additional assessment as well as the disallowance of the rebate to which he was entitled under Rule 18. With respect to the first point the Tribunal held that there was a clear suppression by the assessee and confirmed the assessment. In regard to the claim for rebate, it allowed the appeal and as already stated, remanded the matter to the assessing authority for fresh disposal according to law.

3. The question in this revision case is whether the rebate claimed under Rule 18 is conditional upon the assessee strictly complying with the conditions necessary for submission of true and correct returns. The contention of the learned Advocate is that the rebate, being in the nature of a concession, a dealer who has deliberately violated the provisions of the Act and the Rules and submitted returns with false declarations that the contents therein are true and correct, cannot be entitled to any rebate. The rebate in question is claimed on the sales of oil and is a deduction provided for by Rule 5(1)(k) of the rules subject to the conditions specified under Rule 18. These rules may now be read :

5. (1) The tax or taxes under Section 3 or 5 or the notification or notifications under Section 6(1) shall be levied on the net turnover of a dealer. In determining the net turnover the amounts specified in Clauses (a) to (m) shall, subject to the conditions specified therein, be deducted from the gross turnover of a dealer.

* * * *(k) All amounts which a registered manufacturer of groundnut oil (other than refined groundnut oil) and cake may be entitled to deduct from his gross turnover under Rule 18 subject to the conditions specified in that rule.

18. (i) Any dealer who manufactures groundnut oil and cake from groundnut and/or kernel purchased by him may, on application to the assessing authority having jurisdiction over the area in which he carries on his business, be registered as a manufacturer of groundnut oil and cake.

(2) Every such manufacturer shall be entitled to a deduction under Clause (k) of Sub-rule (1) of Rule 5 equal to the value of the groundnut and/or kernel purchased and converted by him into oil and cake provided that the amount for which the oil is sold is included in his turnover.

Explanation.-For the purpose of this sub-rule-

(a) 143 lb. of groundnut shall be taken to be equivalent to 100 lb. of kernel;

(b) 143 lb. of groundnut or 100 lb. of kernel shall, when converted into oil, be taken to yield 40 lb. of oil; and

(c) one candy of oil shall be taken to be equivalent to 500 lb. of oil.

(3) Every such manufacturer shall submit so as to reach the registering authority not later than the 25th day of every month, a statement in Form A-g in respect of the transactions relating to the previous month.

(3-A) If any such manufacturer fails to submit the statement in Form A-g within the time specified in Sub-rule (3) or if he omits to furnish any of the particulars required by that form, the Commercial Tax Officer may, in his discretion, after making such enquiry as he considers necessary, condone the delay or omission or both:Provided that such manufacturer has maintained a true and correct account of his business showing all the particulars required by Sub-rule (3). * * *

4. The conditions prescribed in Rule 18 are that the assessee must have been registered as a manufacturer of groundnut oil and cake and every such manufacturer would then be entitled to a deduction under Clause (k) of Sub-rule (1) of Rule 5. Thirdly, under Sub-rule (3) of Rule 18, a manufacturer so registered must submit to the registering authority not later than the 25th of every month a statement in Form A-g in relation to transactions relating to the previous month. If a manufacturer does not submit his statement in Form A-g by the 25th of the month, the Commercial Tax Officer has been given discretion to condone the delay provided such a manufacturer has maintained a true and correct account of his business showing all the particulars required by Sub-rule (3). It is the proviso to Sub-rule (3-A) that is sought to be pressed into service by the learned Government pleader as vesting a discretion in the Commercial Tax Officer to reject the rebate. In our view, however, that proviso is only concerned with the question of condoning the delay in submitting the return which submission is a condition precedent to the grant of rebate. In this case, it is not denied that the assessee has submitted the statement in Form A-g within the time specified or that he is a registered dealer. These two essential conditions having been fulfilled, he would be entitled under Sub-rule (2) to the rebate. There is nothing in Sub-rule (2) which makes it subject to the condition that the manufacturer has submitted the statement in Form A-9 correctly, or to the effect that any suppression will disentitle a manufacturer to the rebate. Before a Full Bench of this Court in Sitharama Rice & Oil Mitts v. The State of Andhra [1956] 7 S.T.C. 635 it was sought to be aruged that the rebate can only be given for the period subsequent to the date of registration under Sub-rule (1) of Rule 18. But that contention was rejected on the ground that once a dealer has been registered as a manufacturer under Sub-rule (1) of Rule 18, he is entitled under the provisions of Sub-rule (3) to present the application for the previous month, that is, the month even prior to the month of registration. The rule itself, it was observed, nowhere says that the deduction could be claimed only in respect of the period which is subsequent to the month of registration. This judgment would indicate that once the conditions prescribed in the rule are satisfied, the assessee would be entitled to the rebate even if it is for a subsequent period. In our view, the assessee would be entitled to the rebate once he has fulfilled the conditions specified in Rule 18, notwithstanding the fact that he was later found not to have maintained correct accounts or suppressed the turnover.

5. In this view, the revision case is dismissed with costs. Advocate's fee Rs. 100 (one hundred only).


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