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1994 Supreme(AP) 600
Andhra Pradesh High Court
Judges : AVINASH SOMAKANT BHATE, S.S.M.QUADRI
State Of A.P. - Appellant
Versus
Toshiba Anand Batteries Ltd. - Respondent
Decided On : 12-21-94
The period of limitation of four years prescribed by section 20(3) of the APGST Act covers the whole proceedings of the revision including passing of the final order and of communicating the same promptly to the party concerned.
Headnote:
APGST ACT - SECTION 20(3) - REVISION OF ASSESSMENT - LIMITATION - INTERPRETATION OF STATUTE - POWER OF REVISION - SCOPE AND EXTENT - SECTION 20(2-A) - APPLICATION AND SCOPE - DRY CELL BATTERIES - CLASSIFICATION UNDER APGST ACT - ENTRY NO. 38, 137 AND 152 - INTERPRETATION AND APPLICATION.
Fact of the Case:
The assessee-companies, manufacturers of dry cell batteries, were assessed on their turnover for the years 1978-79 and 1976-77 or 1977-78. The assessing authority treated the dry batteries as electrical goods under entry No. 38 of Schedule I of the A. P. General Sales Tax Act, 1957 (APGST Act). The revising authority thought that the articles fell under entry No. 137 and deserved to be taxed at 12%. The assessee challenged the revision proceedings on the ground of limitation, arguing that the exercise of powers by the Deputy Commissioner in the revision was bad as it was hit by limitation.
Finding of the Court:
The court held that the exercise of powers of revision must come to an end within a period of four years from the date of passing of the order by the subordinate authority. The effect of section 20(3) of the APGST Act is that the revising authority is powerless beyond the period of four years to deal with the revision. The exercise of powers as a whole cannot extend beyond the period of four years from the date on which the order of subordinate authority was served on the dealer.
Issues: 1. Whether the initiation of revision proceedings within four years from the date of assessment order is sufficient to save the limitation of revisional proceedings? 2. Whether the period of limitation of four years prescribed by section 20(3) of the APGST Act covers the whole proceedings of the revision including passing of the final order and of communicating the same promptly to the party concerned? 3. Whether section 20(2-A) of the APGST Act fetters the exercise of powers by the Commissioner, etc., in respect of any issue or question, which is a subject-matter of appeal, before, or which was decided on appeal by, the Appellate Tribunal under section 21? 4. Under which entry of the APGST Act do dry cell batteries fall?
Ratio Decidendi: 1. The court held that the mere initiation of revisional proceedings within four years would not save the limitation of revisional proceedings. The order has to be passed within the four-year period of limitation. 2. The court held that the period of limitation of four years prescribed by section 20(3) of the APGST Act covers the whole proceedings of the revision including passing of the final order and of communicating the same promptly to the party concerned. 3. The court held that section 20(2-A) of the APGST Act fetters the exercise of powers by the Commissioner, etc., in respect of any issue or question, which is a subject-matter of appeal, before, or which was decided on appeal by, the Appellate Tribunal under section 21. However, if the Commissioner or the other competent authority has initiated proceedings in a revision in ignorance of an appeal which is pending before the Tribunal already in respect of an identical issue or question, then the Commissioner will have to stay his hands from exercising the power and the revision will have to be deferred, if it is in relation to an order of assessment during that period. 4. The court held that dry cell batteries fall under entry No. 38 of the APGST Act till the date of coming into force of entry No. 152. Entry No. 152 is a subsequently added entry. The court held that dry battery cells did not fall in any event, under entry No. 137.
Final Decision: The court dismissed the T. R. C. Nos. 70, 80, 96, and 130 of 1987.
( 1 ) THE questions of law sought to be agitated in all these revisions being identical, we propose to dispose them of by a common judgment.
( 2 ) IT may not be necessary to detail the facts but a brief background needs to be stated to understand the nature of revisions.
( 3 ) THE assessee-companies in all these revisions are manufacturing dry cell batteries. They were assessed on their turnover for the years 1978-79 and 1976-77 or 1977-78 as the case may be. The assessing authority treated the dry batteries as electrical goods under entry No. 38 of Schedule I of the A. P. General Sales Tax Act, 1957 ("the APGST Act", for short ). They were therefore taxed at 8 per cent on the turnover as per the said Schedule and made assessment accordingly. The revising authority thought that the articles fell under entry No. 137 and deserved to be taxed at 12 per cent. The revising authority therefore issued a notice dated 25/09/1981, to the assessee asking them as to why revision proceedings should not be initiated. The assessee however, made a request on 4/11/1981, not to proceed with the proposed revisions as certain tax appeals regarding the earlier assessment years in respect of same issue were pending before the Sales Tax Appellate Tribunal (S. T. A. T. ). Accordingly, the revising authority by order dated 7/11/1981, deferred the proceedings of the revisions till the disposal of the appeal. Later on the revising authority proceeded to decide the question after issuing fresh notices to the assessees on 20/12/1984. In the said revisions it was held that the article fell under entry No. 137 and deserved to be taxed at 12 per cent. The order in the revisions was passed by the Deputy Commissioner of Commercial Taxes on 15/04/1985 and served upon the parties subsequent thereto.
( 4 ) APPEALS were filed before the S. T. A. T. against the said decision by the assessee. The S. T. A. T. held that though on the merits the assessees had no case, the exercise of powers of revision by the Deputy Commissioner was barred by limitation as the Deputy Commissioner had passed orders after expiry of four years from that date of order of assessment by the assessing authority. Hence on this technical point of limitation, the appeals were allowed. These appeals were allowed in January, 1986.
( 5 ) THE State has now filed these revisions under section 22 (1) of the APGST Act.
( 6 ) THE question that arises for our determination is whether section 20 (3) of the APGST Act was not applicable in the instant case.
( 7 ) SECTION 20 of the APGST Act reads as follows :" (1) The Commissioner of Commercial Taxes may suo motu call for and examine the record of any order passed or proceeding recorded by any authority, officer or person subordinate to it, under the provisions of this Act, including sub-section (2) of this section, and if such order or proceeding recorded is prejudicial to the interests of revenue, may make such enquiry, or cause such enquiry to be made and subject to the provisions of this Act, may initiate proceedings to revise, modify or set aside such order or proceeding and may pass such order in reference thereto as it thinks fit. (2) Powers of the nature referred to in sub-section (1) may also be exercised by the Joint Commissioner, the Deputy Commissioner and the Commercial Tax Officer in the case of orders passed or proceedings recorded by authorities, officers or persons subordinate to them. (2-A) The power under sub-section (1) or sub-section (2) shall not be exercised by the authority specified therein in respect of any issue or question, which is the subject-matter of an appeal before, or which was decided an appeal by, the Appellate Tribunal under section 21. (3) In relation to an order of assessment passed under this Act, the powers conferred by sub-sections (1) and (2) shall be exercisable only within such period not exceeding four years from the date on which the order was served on the dealer, as may be prescrib
