important point
Rectification of an order u/s 22, Uttar Pradesh Sales Tax Act, 1948 does not mean obliteration of the order originally passed and its substitution by a new order.

JUDGMENT

Dr. ARIJIT PASAYAT, J.—

1.Leave granted.

2.Challenge in this appeal is to the judgment of a Division Bench of the Allahabad High Court allowing the Trade Tax Revision Case Nos. 1055 and 1070 of 1998 filed by the respondent. The two revisions were filed under Section 11 of the Uttar Pradesh Sales Tax Act, 1948 (in short the ‘Act) and the Central Trade Tax Act, 1956 (in short the ‘Central Act’).

3.Factual background in a nutshell is as follows :

“Appellant hereinafter also referred to as the Assessee was dealing with Aluminium powder. In the original assessment order passed under Section 7(3) of the Act and Section 9 of the Central Act, Aluminium Powder was treated as metal and accordingly held liable to tax at the rate of 2.2%. Assessing officer initiated proceedings under Section 22 of the Act on the ground that this Court had in Hindustan Aluminium Corporation Ltd. v. State of Uttar Pradesh and Another1, [1981(3) SCC 578] considered the entry “All kinds of minerals, ores, metals and alloys including sheets and circles” and held that under this entry only the primary metal is covered. It was also held that sheets and circle of Aluminium would not be covered under the entry “Metal” Assessing officer accordingly rectified the assessment orders under Section 22 and levied tax treating the Aluminium powder as an unclassified item. The First appellate authority in the appeals filed by the assessee held that Section 22 of the Act had no application and the assessments were set aside. The present respondent filed appeals before the Sales Tax Tribunal, Varanasi Bench (in short the ‘Tribunal’) which were also dismissed. In the revision petitions filed, as noted above, the High Court held that action under Section 22 of the Act is clearly sustainable. It referred to a decision of this Court in M/s. Karam Chand Thapar & Bros. (Coal Sales) Ltd. v. State of Uttar Pradesh & Anr.2, [(1976) 4 SCC 257] and held that a decision of this Court can be a ground for rectification of error in terms of Section 22 of the Act. The High Court did not accept the stand of the appellant that Aluminium powder in the powder form remains Aluminium in its primary form and in any case this is a debatable issue and, therefore, Section 22 of the Act does not apply.

4.Learned counsel for the appellant submitted that this is a case where Section 22 of the Act had no application. The said provision is only applicable to a case where the error is apparent on the face of the record; Where the issue can not be decided in a undisputable manner, Section 22 has no application; and where a matter is disputable there can be no order under Section 22 of the Act.

5.Learned counsel for the respondent on the other hand submitted that in view of this Court’s decision in Hindustan Aluminium Corporation’s case (supra) there is no scope for taking a different view and, therefore, Section 22 clearly had application.

6.Section 22 of the Act reads as follows :

“Rectification of Mistakes :

(1)Any officer or authority, or the Tribunal or the High Court may, on it’s own motion or on the application of the dealer or any other interested person rectify any mistake in any order passed by him or it under this Act apparent on the record within three years from the date of the order sought to be rectified:

Provided that where an application under this sub-section has been made within such period of three years, it may be disposed of even beyond such period.

Provided further that no such rectification as has the effect of enhancing the assessment, penalty, fees or other dues shall be made unless reasonable opportunity of being heard has been given to the dealer or other person likely to be affected by such enhancement.

2.Where such rectification has the effect of enhancing the assessment, the assessing authority concerned shall serve on the dealer a revised notice of demand in the prescribed form and there from all the provisions of the Act and rules framed there under shall apply as if s