Kutty Flush Doors and Furniture Co. (P.) Ltd. vs The State of Tamil Nadu

Balasubrahmanyan, J.—In this revision filed by a sales tax assessee, the question raised is about the jurisdiction of the Deputy Commissioner

to use his special powers of revision to revise the assessee''s Central sales tax assessment for 1968-69. In the assessment for that year, the

assessing authority left out of account a turnover of Rs. 2,42,842.86, which, it is now admitted, represented the assessee''s sales in the course of

inter-State trade. The amount was omitted in the assessee''s return. It was also omitted in the assessment order. To any one who happened to

peruse either the return or the assessment order, there would not be the slightest indication that Rs. 2,42,842.86 was omitted to be charged to

Central sales tax, for the assessment agreed with the return, by and large.

Subsequently, the Deputy Commissioner of Commercial Taxes happened to peruse the assessee''s Central sales tax file for this very assessment

year 1968-69. In that file was found a copy of the assessee''s assessment order for the same year 1968-69 made under the Tamil Nadu General

Sales Tax Act, 1959. The Deputy Commissioner perused the copy of that assessment order. The said order made mention of the sales turnover of

Rs. 2,42,842.86, but having mentioned that turnover, kept it outside the assessment under the Tamil Nadu General Sales Tax Act on the ground

that it did not represent sales inside the State but sales outside the State. The position thus was, that while the Central sales tax assessment order

omitted this turnover from assessment by non-mention, the assessment order under the Tamil Nadu Revised Sales Tax Act made mention of it,

only to omit it from the taxable turnover. The Deputy Commissioner however, was satisfied that the amount of Rs. 2,42,842.86 represented sales

turnover in the course of inter-State trade, and hence that amount had to be included in the assessee''s Central sales tax assessment for 1968-69.

The Deputy Commissioner accordingly invoked his powers u/s 32 of the Tamil Nadu General Sales Tax Act. After hearing the assessee''s

objections, the Deputy Commissioner revised the Central sales tax assessment order for 1968-69, by adding, to the turnover already assessed, the

inter-State sales amounting to Rs. 2,42,842.86.

In this revision, the assessee does not dispute that Rs. 2,42,842.86 represents inter-State sales appertaining to 1968-69. He does not also

dispute the position that this was omitted to be assessed in the order of assessment passed by the assessing authority. Nevertheless, it is urged

before us, that the Deputy Commissioner was not justified in revising the assessment order. The point urged by Mr. Ramanathan, for the assessee,

is that section 32 does not enable the Deputy Commissioner to interfere in revision and revise an assessment order, by referring to extraneous

records. The learned counsel pointed out that the assessee''s Central sales tax assessment order did not disclose the inter-State sales of Rs.

2,42,842.86. This omission could be gathered only by looking into the assessee''s file under the Tamil Nadu General Sales Tax Act. Mr.

Ramanathan referred to the language of section 32 and said that the Deputy Commissioner can revise an order under this section only by examining

that order and not by examining quite a different order.

We do not accept this contention as tenable. The marginal note to section 32 of the Act describes the powers of the Deputy Commissioner as

special powers"". The section empowers the Deputy Commissioner to call for and examine any order of assessment passed by the assessing

authority and also empowers the Deputy Commissioner to make such enquiry as he thinks fit and after such enquiry pass such order as he thinks

fit. The section does not impose any limitation whatever on the Deputy Commissioner''s power excepting that the order which he passes must be

subject to the other provisions of the Act. The legislature does not impose the condition that the Deputy Commissioner should confine his

examination only to the order proposed to be revised and he cannot take in information from outside the order for the purpose of effectively

exercising his powers of revision.

The assessment in a particular case may not be in accordance with the provisions of the Act either because the order of assessment is incorrect

or because the order of assessment is incomplete. In other words, the assessing authority may be guilty of errors of commission as well as errors of

omission, in making the assessment. It is for the rectification of these errors that powers have been given to the Deputy Commissioner u/s 32 of the

Act. It is possible for the Deputy Commissioner to direct errors of commission in the assessment order, by merely perusing the text of the

assessment order. But errors of omission cannot be found in this manner, ex facie from the assessment order alone. Omission of an amount of

taxable turnover from the assessment will not be detected, however intensely one may read the assessment order. One can only become aware of

omissions from assessment from some materials other than the assessment order itself. We find it hard to accept the position that errors of omission

are intended to be left out of account in the exercise of the special powers of the Deputy Commissioner under the section. An extraneous material

of this sort may come into his possession either before or after he examines the order in question. In either event, if he discovers the errors of

omission in the assessment or order, he can certainly revise the order. Section 32, no doubt, speaks about the Deputy Commissioner examining the

order sought to be revised. But, there is nothing in the section which implies that he ought not to examine any other order or record. Words such as

alone"" or ""only"" do not qualify the Deputy Commissioner''s power to ""examine"" the order sought to be revised. The order of assessment which the

Deputy Commissioner revised in the present case does not show ex facie that there was any error of commission in the assessment. On the

contrary, the assessment was an incomplete assessment. It omitted a large chunk of inter-State sales from being brought to tax. It is true that this

information about the omission of Rs. 2,42,842.86 was vouchsafed to the Deputy Commissioner, not from the order sought to be revised nor even

from the record of assessment, but from a record extraneous to this assessment. But, the Deputy Commissioner was not prevented from perusing

this record also. Indeed, his examination of the order, which is now sought to be revised, became meaningful and purposeful only because of his

examination of the order. Section 32 does not require the Deputy Commissioner to undertake a meaningless and purposeless examination of the

assessing authority''s order. On the contrary, the examination has to be for the purpose of revision.

For the reasons stated above, we reject the assessee''s contentions in the same way as they were rejected by the Tribunal. The result is that

revision fails and is dismissed. The assessee will pay costs of the State Government counsel''s fee Rs. 250.

The learned counsel for the assessee makes an oral application for leave to appeal to the Supreme Court. We do not think that this case is of

such a kind that it needs the time and attention of the Supreme Court to be spent on the determination of the question on which we have found no

doubt whatever. Nor do we think this is a matter of great public importance to merit deliberation of the highest Court in the land. The oral

application is accordingly rejected.