State of Andhra Pradesh vs Sankar Baby and Marine Vermicelli Factory

B.P. Jeevan Reddy, J.—For the assessment year 1979-80, the Deputy Commercial Tax Officer, Chittoor, treated "semia" as different goods than that of "maida" and levied tax thereon. He treated "semia" as "general goods". The assessment order is dated 9th July, 1980. The assessee-dealer did not file an appeal against the said assessment. Sometime in 1983, he invoked the revisional jurisdiction of the Deputy Commissioner, basing on the decision of the Tribunal in Tribunal Appeals Nos. 242 and 359 of 1978, dated 30th December, 1978, confirmed by this Court in T.R.C. Nos. 64 and 65 of 1979, dated 13th December, 1982 (State of Andhra Pradesh v. Karnatakam Govindayya Setty and Sons 1984 55 STC 160.) - wherein it was held that "semia" is nothing but "maida". The Deputy Commissioner refused to exercise his revisional power on the ground that the Tribunal''s judgment is long prior to the date of assessment order in this case and that even after coming to know of the High Court''s judgment, the petitioner did not move promptly to invoke his revisional jurisdiction. Against the order of the Deputy Commissioner, the assessee filed an appeal. The Tribunal did not go into the question whether the Deputy Commissioner was justified or not in refusing to exercise his revisionary jurisdiction. It went into the merits of the case and and following the decision of this Court aforesaid allowed the appeal and remanded the matter to the assessing authority with the following direction :

"The assessing authority will issue notice to the assessee and after hearing the objections of the assessee will decide the question whether the ''semia'' sold by the assessee was manufactured out of ''maida'' purchased from resident dealers in the State or whether the commodity ''semia'' was purchased by the assessee from the resident dealers in the State and in turn sold it as ''semia'' to other. Depending upon the conclusion the assessing authority will arrive after an enquiry, the assessment will be finalised applying the appropriate rate of tax."

The State has preferred this revision against that order.

We may mention that the Tribunal''s order is a common one in two appeals preferred by the same assessee in T.A. Nos. 122 and 124 of 1984. T.A. No. 122 of 1984 pertained to the assessment year 1979-80 and T.A. No. 124 of 1984 to assessment year 1980-81. This Tax Revision Case was sought to be preferred against both the Tribunal appeals. But the office took an objection and confined it to Tribunal Appeal No. 122 of 1984 only. We do not know whether another Tax Revision Case is preferred by the State against the Tribunal Appeal No. 124 of 1984. This order therefore will confined to the assessment year 1979-80 only.

The learned Government Pleader contended that the Deputy Commissioner was within his power in refusing to exercise his revisional jurisdiction when the assessee had not properly explained his failure to prefer an appeal against the order of assessment. He contends that the assessee was aware of the Tribunal''s judgment even by the date of assessment. The judgment of the High Court on 13th December, 1982, affirming the Tribunal''s view does not provide a fresh cause of action, he submits, and, therefore, it cannot be said that the Deputy Commissioner acted arbitrarily or perversely in refusing to exercise the discretionary power of revision. He also submits that the Tribunal was in error in not dealing with this aspect and straightway entering the merits of the case. He submits that by this process the entire default of the assessee in not preferring an appeal for a period of more than two years has been condoned in an indirect manner.

While we see quite some force in the contention of the Government Pleader, we are of the opinion that in the facts and circumstances of the case, it would not be just to allow the tax revision case on the said point. We think that it would meet the ends of justice and law if we direct that the assessing authority shall keep in mind the rule of unjust enrichment as adumbrated in this Court''s judgment in Ramaiah v. State AIR 1986 AP 361, which rule is also incorporated in section 33-BB of the Andhra Pradesh General Sales Tax Act. In this view of the matter, we modify the order of the Tribunal in the following manner :

"The assessing authority will issue notice to the assessee and after hearing the objections of the assessee and also after examining the question whether the assessee has collected tax on the goods in question, will decide the question whether the ''semia'' sold by the assessee was manufactured out of ''maida'' purchased from resident dealers in the State or whether the commodity ''semia'' was purchased by the assessee from the resident dealers in the State and in turn sold it as ''semia'' to other. Depending upon the conclusion the assessing authority will arrive after an enquiry, the assessment will be finalised applying the appropriate rate of tax."

If the Deputy Commissioner finds that the assessee has collected tax on the said goods, from his purchasers, the assessee will not be entitled to any relief. But if it is proved that he has not collected the tax, he shall be refunded the tax, if any, collected from him which was not due from him in law.

The tax revision case is accordingly disposed of. No costs. Advocate''s fee Rs. 150.

Petition disposed of accordingly.