Producer Exchange Corporation vs The State of Bihar

S.K. Jha and A.K. Sinha, JJ.—This is a reference u/s 33(1) of the Bihar Sales Tax Act, 1959 (hereinafter referred to as "the Act"), by the Commercial Taxes Tribunal, Bihar, Patna, for the assessment year 1966-67.

The statement of case has been duly submitted and the only question referred for our opinion is :

Whether, in the facts and circumstances of the case, the Tribunal was correct in holding that the period of limitation for the appeal against the order of assessment dated 28th February, 1969, should be counted from 24th June, 1969, the date on which the original demand notice was served on the dealer and not from 26th September, 1969, when the revised demand notice was so served.

The dealer was assessed for the year 1966-67 by an order of assessment dated 28th February, 1969, a copy of which has been marked as annexure A. The relevant demand notice (annexure B) was served on him on 24th June, 1969. On 5th August, 1969, a petition for review of the assessment order was filed, by the dealer before the assessing officer pointing out that the enhancement of the turnover was unjustified and that the deduction claimed by the dealer on account of sales of tax-paid commodities was wrongly disallowed. This petition was rejected on 8th August, 1969. Thereafter the dealer filed another application for review of the order which was partially allowed. The dealer preferred appeals before the Deputy Commissioner of Commercial Taxes, which were both dismissed on account of limitation. The dealer thereafter preferred revisions before the Tribunal and it upheld the decision of the Deputy Commissioner that the appeals were rightly held to be barred by limitation.

In this case we are not concerned with the appeal in so far as the original order of assessment is concerned. The only question that arises for determination is as to whether the second revision application was barred by limitation or not. According to the statement of case submitted before us a revised demand notice (annexure G) was served on the dealer on 26th September, 1969, after allowing certain deductions. The Tribunal has held that even in so far as the revised demand notice is concerned, the period of limitation will reckon from the date of the original demands. This is clearly an erroneous view of the law. It is well-settled that the period of limitation in such cases will begin to run from the date of the revised demand notice. If reference be needed, we may at once refer to, inter alia, the cases in Commissioner of Commercial Taxes Vs. Sheodutta Prasad Chandeshwar Singh, , Commissioner of Commercial Taxes Vs. North Ramgarh Coal Company Private Ltd., and Commissioner of Commercial Taxes Vs. Rameshwar Das Panna Lal, , without going into further detailed statements, as the point posed for our opinion is already covered by the cases cited above, apart from others. We, accordingly, answer the question in favour of the assessee (the dealer) and against the revenue.

We hold that the period of limitation in the appeal shall run from 26th September, 1969, when the revised demand notice was served on the dealer. The assesseet dealer shall be entitled to costs. Hearing fee is assessed at rupees two hundred fifty only.