G.P. Singh, C.J.
1. This is a reference under Section 44(1) of the Madhya Pradesh General Sales Tax Act, 1958, made by the Sales Tax Appellate Tribunal (Board of Revenue), referring for our answer the following question of law :
Whether under the facts and circumstances of the case, where the imposition of penalty under Section 43(1) of the Act had not been considered by the assessing authority and the first appellate authority, limitation under Section 39(2) of the Act was to be taken from the assessment order or the order of the first appellate authority?
2. The relevant assessment year is 1962-63. The assessment order by the Sales Tax Officer was passed on 7th June, 1965. The Sales Tax Officer did not take any proceedings for imposing penalty under Section 43 of the Act. The dealer preferred an appeal which was decided by the Additional Appellate Assistant Commissioner of Sales Tax on 9th March, 1966. The appellate authority also did not take any action under Section 43. The Commissioner took the matter in suo motu revision under Section 39(2) of the Act, being of the view that the appellate order was erroneous and prejudicial to the interest of the revenue as no action was taken for imposition of penalty under Section 43. The notice was issued to the dealer on 7th March, 1969. The Additional Commissioner imposed penalty of Rs. 1,000 under Section 43(1) in the revision. The dealer went up in appeal against the order imposing penalty to the Tribunal. The Tribunal set aside the order on the ground that the revision was barred by limitation.
3. The proviso to Section 39(2) says that no proceedings shall be initiated under this section after the expiry of three years from the date of the order sought to be revised. Now if the order sought to be revised was the order of the appellate authority, the exercise of revisional power was within three years and not barred by limitation ; whereas if it is held that the order sought to be revised was the order passed by the Sales Tax Officer, then the period of three years had clearly run out. The Tribunal seems to be of the view that as the Sales Tax Officer, who was the assessing authority, failed to take action for imposition of penalty, it was that order which ought to have been revised and therefore, the limitation of three years should be counted from the date of the assessment order and not from the date of the appellate order. In so holding the Tribunal failed to take notice of Section 43 by which the appellate authority is also empowered to take proceedings for imposition of penalty. Section 43 opens with the words 'if the Commissioner or the appellate authority in the course of any proceedings under this Act is satisfied'. An appeal is certainly any proceedings within the meaning of Section 43. The appellate authority, while hearing an appeal and finding that the circumstances of the case show that the dealer was guilty of concealment of turnover, can take proceedings for imposition of penalty. In failing to take action under Section 43 and in not imposing penalty while disposing of the appeal the appellate authority passed an order which was clearly prejudicial to the interests of the revenue. The Commissioner was, therefore, entitled under Section 39(2) to revise the said order, as the order imposing penalty could have been passed by the appellate authority. In our opinion, the Commissioner was competent to revise the order of the appellate authority under Section 39(2). The limitation for taking proceedings under Section 39(2) for revising the order of the appellate authority is three years from the date of the appellate order. We have already stated that counting limitation from the date of the order of the appellate authority, the revisional proceedings were within limitation.
4. For the reasons stated above, we answer the question referred as follows:
In the facts and circumstances of the case, the limitation under Section 39(2) had to be counted from the date of the appellate order.
There will be no order as to costs of this reference.