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Ramanlal Poonambhai Vs. Commissioner, Sales Tax, M.B. Government - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtMadhya Pradesh High Court
Decided On
Case NumberCivil Reference No. 68 of 1953
Judge
Reported inAIR1957MP10; [1957]8STC305(MP)
ActsMadhya Bharat Sales Tax Act, 1950 - Sections 8(1) and 8(5)
AppellantRamanlal Poonambhai
RespondentCommissioner, Sales Tax, M.B. Government
Appellant AdvocateS.L. Dubey, Adv.
Respondent AdvocateK.A. Chitale, Adv.
Excerpt:
.....periods of that year have become due, in theevent of any dealer failing to submit a return forany quarter, the assessing authority can, and is required to determine the turnover of the dealer forthis quarter to the best of his judgment and assessthe tax on its basis. for, whichever construction is put, in the present case the assessee cannot claim any rebate on the tax assessed for the first quarter ending on 30th june, 1950. if it is held that under sub-section (5) rebate can be allowed only when there is a composite determination of the tax for all the four quarters in the year 1950-51, then, here, clearly the tax for the first quarter having been determined and assessed it cannot be said that the determination of the tax for the remaining three quarters was a determination of the tax..........shall file returns of turnover for the periods ending june, september, december and march of an assessment year in form-i within four weeks of the end of each period. sub-s. (5) of section 8 reads as follows :-- '(5) -- in determining the tax for the year 1950-51 the assessing officer shall allow a rebate, varying from 20 per cent to 40 per cent, as may be found necessary, of the tax payable on imported goods by a dealer who had in his stock on 1st may, 1950, goods imported before that date.' 3. mr. dubey, learned counsel appearing for the assessee, argued that under section 8 (1) (a), the assessment of sales-tax for any year had to be made after the returns for all the quarters of that year had become due and that, therefore, the assessing authority was not justified in assessing the.....
Judgment:

Dixit, J.

1. In this reference under Section 13 of the Madhya Bharat Sales Tax Act, 1930, made by the Commissioner, Sales Tax, of the former Madhya Bharat Government, the questions referred to for decision are :--

1. 'Whether rebate under Section 8 (5) of the Act can be allowed for full one year, comprising of all the four quarters keeping in view assessment made under Section 8 (1) (b) of the Act for any of the said quarters?'

2. 'Whether demand created under Section 8 (1) (b) of the Act for any quarter can be modified under Section 8 (5) of the Act?'

Messrs. Ramanlal Poonambhai who arc dealers in tobacco and licensed under the Sales Tax Act were required to file their returns of turnover quarterly. iN the year 1950-51, they failed to submit their return for the first quarter ending on 30th June, 1950: Thereupon under Section 8 (1) (b) of the Act, the assessing authority determined the turnover of the firm for the said period to the best of his judgment and assessed the tax accordingly.

Messrs, Bamanlal Poonambhai, however, submitted in time their returns for the succeeding throe quarters. Ai the time of determining the fax for the three quarters for which the returns had been submitted, the assessee claimed that under Section 8 (5) he was entitled to a rebate on the tax payable for the first quarter in respect of tobacco imported in that quarter as also a rebate on the tax payable for the remaining three quarters on the goods imported during that period.

The assessing authority did not allow any rebate on the tax payable for the first quarter which tax had been determined under Section 8 (1) (b). The assessee then appealed to the Judge, Sales Tax Appeals. The appellate Judge took the view that the assessee was entitled to a rebate on the total tax payable by him for the whole year including the amount of tax assessed for the first quarter under Section 8 (1) (b). The Sales Tax Officer then preferred a revision petition against the decision of the appellate Judge to the Commissioner, Sales Tax.

The learned Commissioner took the view that the assessment under Section 8 (1) (b) for the first quarter having become final could not be modified by any order of assessment of tax for the remaining quarters of the year. He has now made this reference at the instance of the assessee for the determination of questions referred to above.

2. The material provisions are Clauses (a) and (b) of Section 8 (1) and Sub-section (5) of Section 8 of the Act. Clauses (a) and (b) of Section 8 (1) are as follows :--

''(a) -- Assessment of taxable turnover and determination of tax due lor any year, shall be made after the returns for all the periods of that year have become due:

Provided that in the case of Melas the assessment shall be made as soon. as the return of turnover has been received.

(b) -- Notwithstanding anything contained in Clause (a) if any dealer fails to submit a return under Section 7 (1) for the prescribed period within the prescribed time, the assessing Authority shall, after making such enquiry as he considers necessary and after giving the dealer a reasonable opportunity of being heard determine the turnover of the dealer for the said period to the best of his judgment and assess the tax on the basis thereof. This assessment, subject to the provision of Section 10 and to such orders as maybe passed in appeal or revision, shall be final for the period.'

R. 4 (a) of the Madhya Bharat Sales Tax Rules, 1950, prescribes the period for which returns have to be filed and the time within which they are to be filed. It says a dealer shall file returns of turnover for the periods ending June, September, December and March of an assessment year in Form-I within four weeks of the end of each period. Sub-s. (5) of Section 8 reads as follows :--

'(5) -- In determining the tax for the year 1950-51 the Assessing Officer shall allow a rebate, varying from 20 per cent to 40 per cent, as may be found necessary, of the tax payable on imported goods by a dealer who had in his stock on 1st May, 1950, goods imported before that date.'

3. Mr. Dubey, learned counsel appearing for the assessee, argued that under Section 8 (1) (a), the assessment of sales-tax for any year had to be made after the returns for all the quarters of that year had become due and that, therefore, the assessing authority was not justified in assessing the tax separately for the first quarter when the assessee failed to submit any return for that period. Jt was further said that even if such an assessment for any quarter could be made under Section 8 (1) (b), the question of allowing any rebate on the tax for the year 1950-51 could only be decided at the time of determining the tax for the entire year 1950-51, that is at the end of the year when the returns for all the periods had become due and that, therefore, the assessee could claim a rebate under Sub-section (5) on the tax payable by him for the first quarter of 1950-51 even though the assessment of the tax for that quarter had become final.

In reply, Mr. Chitale contended that the assessing authority was within his rights in making a separate assessment for the first quarter ending 30th June, 1950, under Section 8 (1) (b) when the assessee failed to submit his return for that quarter; that the tax for the first quarter having been determined and assessed, the determination ot the tax fur the remaining quarters could not be said to be a determination of the tax ior the entire year 1950-51, and that, therefore, Sub-section (5) which permitted rebate in determining the tax for the year 1950-51 could not be availed of by the assessee for claiming any rebate and that in any case he could not claim any rebate on the tax assessed for the first quarter as the assessment had become final at the time of determining the tax for the remaining quarters.

4. In my judgment, the provisions of Clauses (a)and (b) of Section 8 (1) leave no doubt that while assessment of taxable turnover and determination of taxdue for any year can be made after the returns forall the periods of that year have become due, in theevent of any dealer failing to submit a return forany quarter, the assessing authority can, and is required to determine the turnover of the dealer forthis quarter to the best of his judgment and assessthe tax on its basis.

The opening words of Clause (b) 'notwithstanding anything contained in Clause (a)'' and the following direction in Clause (b) ''determine the turnover of the dealer for the said period.....and assess the tax on the basis thereof' unmistakably show that a separate assessment of the tax for a quarter for which no return has been filed is legal. Such an assessment is open to appeal or revision but if there is no appeal or revision against it, it is final.

In the instant case, the assessee did not appeal against the assessment for the quarter ending on 30th June, 1950. Now, Sub-section (5) speaks of allowing a rebate to an assessee 'in determining the tax for the year 1950-51'. On the arguments advanced by the learned counsel for the parties the real question raised is whether the expression 'in determining the tax for the year 1950-51' should be construed as meaning determining the tax compositely for all the four quarters in the year or whether it should be taken as including a separate determination of the tax for any quarter or quarters.

I think it is unnecessary to express any opinion on this question. For, whichever construction is put, in the present case the assessee cannot claim any rebate on the tax assessed for the first quarter ending on 30th June, 1950. If it is held that under Sub-section (5) rebate can be allowed only when there is a composite determination of the tax for all the four quarters in the year 1950-51, then, here, clearly the tax for the first quarter having been determined and assessed it cannot be said that the determination of the tax for the remaining three quarters was a determination of the tax for the whole year 1950-51.

If the alternative construction is adopted as the right one, then also no rebate can be allowed to the assessee for the first quarter ending on 30th June, 1950. For, the tax for that quarter had already been determined and assessed under Section 8 (1) (b) and has become final and did not remain to be determined when the assessee claimed rebate for that quarter at the time of the determination of the tax for the remaining three quarters of the year.

The proper time for the assessee to raise the question of rebate for the quarter in question was when the tax was being actually determined by the assessing authority under Section 8 (1) (b) or in an appeal against that assessment. The assessee having failed to do so, it is not now open to him to claim that he is entitled to any rebate under Sub-section (5) of Section 8 on the tax assessed on him for the quarter ending on 30th June, 1950.

I would, therefore, answer the second question referred for our decision by saying that in this case as the assessment for the quarter ending on 30th June, 1950, had become final, it could not be modified subsequently under Sub-section (5). As to the first question, I express no opinion as the assessment for the first quarter having become final it does not arise for determination. There will be no order as to costs of this reference.

Samvatsar, J.

5. I agree.


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