St. Joseph''s Publication vs Sales Tax Officer

C.N. Ramachandran Nair, J.—The petitioner is challenging Ext.P4 order of the Deputy Commissioner of Agricultural Income Tax and Sales Tax whereunder he has dismissed a common application filed by the petitioner u/s 35(1) of the KGST Act, 19.63 for suo motu revision of the sales tax assessments completed for the assessment years 1992-93 and 1993-94 for granting exemption on the sales turn over of composition books, which according to the petitioner, was wrongly assessed when it was exempted under Serial No. 6 of the III Schedule to the KGST Act, 1963.

I have heard learned counsel for the petitioner and learned Government Pleader.

Sales tax assessment of the petitioner for the assessment years 1992-1993 and 1993-1994 were completed vide Exts.P1 and P2 dated 28.2.1994 and 23.2.1995 respectively. Assessments were completed based on the returns filed by the petitioner whereunder he has disclosed sales turnover of composition books as taxable. The assessments so completed were not contested in appeals and orders became final. However, according to the petitioner, sales turnover of composition books which was exempted from tax under Sl.No. 6 of the III Schedule to the KGST Act, 1963 was wrongly assessed. Therefore, the petitioner filed application before the Deputy Commissioner of Agricultural Income Tax and Sales Tax u/s 35(1) of the KGST Act for suo motu revision of the original assessments completed whereunder petitioner had already paid the tax on the turn over of composition books. The Deputy Commissioner under a detailed order Ext.P4 held that the application filed by the petitioner is not maintainable u/s 35 of the KGST Act. The learned counsel for the petitioner relied on the decision of the Supreme Court in Rampyari Devi Saraogi Vs. Commissioner of Income Tax, West Bengal and Others, , and contended that even if revision of assessment u/s 35(1) leads to loss of revenue, still the assessment has to be revised as order passed against the statutory provisions are orders prejudicial to the interest of the revenue.

Learned Government Pleader on the other hand contended that the contention raised by the petitioner which was recognised by the decision of this Court in Deputy Commissioner v. Balachandran 1988 (1) KLT 233, is no longer a good law, after amendment to the statute by Finance Act, 1998 (Act 13/1998) dated 1.4.1998 whereunder the authority of the Deputy Commissioner to revise the assessments suo motu u/s 35(1) of the KGST Act is limited only to orders prejudicial to the revenue. I am in agreement with the argument of the learned Government Pleader because the position canvassed by the petitioner was law declared by this Court under the decisions above referred. Amendment was brought to Section 35(1) of the Act specifically to get over the decision of this Court and after amendment of the Act, the Deputy Commissioner has no authority to revise assessments on application and grant refund of tax to the assessees. Order for refund of the tax admitted and paid by the assessee will certainly be an order prejudicial to the revenue. In this case, the relief sought is refund of paid tax and if allowed by the Deputy Commissioner on the application of the petitioner, it will be certainly loss to the revenue which obviously is an order prejudicial to the interest of the revenue. The jurisdiction conferred u/s 35(1) of the KGST Act is only to prevent loss of revenue by correction of orders of subordinate authorities and not to order refund of tax collected under their orders. After the amendment to Section 35(1) vide Act 13 of 1998 if any assessee is aggrieved by an assessment, he has to only file appeal against the assessment. The only ground on which the petitioner filed application u/s 35(1) is to avoid limitation provided for filing appeal which was over long before filing application for suo motu revision. Therefore, the petitioner''s application was rightly rejected by the Deputy Commissioner as the same is not maintainable u/s 35(1) of the KGST Act.

It has to be noted that even if applications were entertained, I do not think that the petitioner has any case on merits. The item sold by the petitioner is stated to be "composition books" which are only note books not exempt under SI.No. 6 of the III Schedule to the KGST Act which grants exemption on books, journals, magazines and weeklies which are obviously published reading materials.

The Original Petition is therefore devoid of any merit and the hence the same is dismissed.