Allahabad High Court
M/S Anupam Rice Mill Pvt. Ltd. vs The Commissioner Commercial Tax U.P. ... on 17 May, 2025
Author: Piyush Agrawal
Bench: Piyush Agrawal
HIGH COURT OF JUDICATURE AT ALLAHABAD
Neutral Citation No. - 2025:AHC:82230
Court No. - 10
Case :- SALES/TRADE TAX REVISION No. - 365 of 2017
Revisionist :- M/S Anupam Rice Mill Pvt. Ltd.
Opposite Party :- The Commissioner Commercial Tax U.P. Lko.
Counsel for Revisionist :- Murari Mohan Rai
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 84 of 2018
Revisionist :- M/S Arvind Rice And Oil Mill, Bindki
Opposite Party :- The Commissioner Commercial Tax, Up
Counsel for Revisionist :- Murari Mohan Rai
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 378 of 2010
Revisionist :- M/S Singh Rice Mill Pakri Rabarstganj Sonbhadra
Opposite Party :- Commissioner Commerical Tax U.P. Lkw.
Counsel for Revisionist :- Ashok Kumar,Praveen Kumar
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 375 of 2010
Revisionist :- M/S Jai Bajrangi Mini Rice Ill Madupur Sonbhadra
Opposite Party :- Commissioner Commerical Tax U.P. Lkw.
Counsel for Revisionist :- Ashok Kumar,Praveen Kumar
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 376 of 2010
Revisionist :- M/S Singh Industries Rabartsganj Sonbhadra
Opposite Party :- Commissioner Commerical Tax U.P. Lkw.
Counsel for Revisionist :- Ashok Kumar,Praveen Kumar
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 377 of 2010
Revisionist :- M/S Vikas Industries Lohra Sukrat Sonbhadra
Opposite Party :- Commissioner Commerical Tax U.P. Lkw.
Counsel for Revisionist :- Ashok Kumar,Praveen Kumar
Counsel for Opposite Party :- C.S.C.
WITH
Case :- SALES/TRADE TAX REVISION No. - 379 of 2010
Revisionist :- M/S Modern Kalyani Mini Rice Mill Rabrasganj Sonbhadra
Opposite Party :- Commissioner Commerical Tax U.P. Lkw.
Counsel for Revisionist :- Ashok Kumar,Praveen Kumar
Counsel for Opposite Party :- C.S.C.
HON'BLE PIYUSH AGRAWAL,J.
1. Heard Mr. M.M. Rai along with Mr. Praveen Kumar, for the revisionists and Mr. B.K. Pandey and Mr. Ravi Shanker Pandey, learned ACSC for the State - respondent.
2. The issue involved in all the aforesaid revisions are common, therefore, with the consent of the learned counsel for the parties, all the aforesaid revisions are decided by the common order treating the Sales / Trade Tax Revision No. 365 of 2017 as leading case.
Sales/Trade Tax Revision No. 365 of 2017
3. The instant revision has been admitted vide order dated 21.8.2017 on questions of law nos. (A), (B) and (C), but today when the case is taken up, learned counsel for the revisionists is pressing only question no. (B), which is quoted hereunder:-
"(B) Whether on the facts and in the circumstances of the case, provisions of Section 10 B of the Act could be invoked on the basis of material and subsequent judgment of any court which was not on 'record' at the time of passing of the order, being revised on the basis of illegality or impropriety?
4. The instant revision has been filed against the judgment and order dated 20.5.2017 passed by the Commercial Tax Tribunal, Allahabad.
5. Learned counsel for the applicant-revisionist submits that the assessing authority while framing regular assessment under Section 9 (2) of Central Sales Act as per the provisions of Section 15 (C), has allowed to adjust of Rs. 37450/- towards the tax liability of Central Sales Tax amounting to Rs. 51561/-. He further submits that while purchase of paddy, tax was paid out of such paddy rice were produced and interstate sales of such rice were made. Thereafter Joint Commissioner( Executive) Commercial Tax issued a notice while exercising its powers under Section 10 B of UP Trade Tax Act read with Section 9 (2) of Central Sales Tax Act for revising the assessment order. By order dated 31.3.2010, under Section 10 B of the Act, the original assessment order dated 15.12.2006 was set aside and remanded the matter to decide the case in the light of the Division Bench judgment of this Court in the case of M/s Aryaverth Chawal Udyog and others Vs. State of U.P. and others, reported in 2008 UPTC, 881. The assessing authority passed the fresh order dated 21.6.2010 which was challenged in the appeal but the same was dismissed vide order dated 9.9.2014 against which a second appeal was preferred, which was also dismissed vide order dated 20.5.2017. Hence the present revision.
6. Learned counsel for the revisionist further submits that the revisionist has raised the issue of jurisdiction for initiating the order passed under Section 10 B of the Act on the basis of subsequent judgment being given. He further submits that the proceedings under Section 10 B of the Act can legally be initiated on the ground of material available on record at the time of passing of the assessment order. The case in hand, admittedly, the proceedings has been initiated only on the basis of subsequent judgment and order passed by this Court in the case of M/s Aryaverth Chawal Udyog and others (supra). He submits that the authorities can exercise power under Section 10 B of the Act with regard to the legality and propriety of the order passed by the officers subordinate on the date of passing of the order / judgement. But the basis on which the present proceedings were initiated are bad as the judgement passed in the case of M/s Aryaverth Chawal Udyog and others (supra) was not available on record.
7. Per contra, learned ACSC supports the impugned order and submits that the revisionist was not legally entitled for the benefit of tax paid on the paddy to be allowed on the interstate sale, therefore, the proceedings has rightly been initiated. He submits that law is in favour of the State as decided not only by this Court but also affirmed by the Apex Court, therefore, the proceedings are justified in the eyes of law.
8. After hearing learned counsel for the parties, the Court has perused the records.
9. The record shows that the assessment order was passed on 15.12.2006 and thereafter the proceedings under Section 10 B of the Act was initiated on the basis of the subsequent judgment passed by this Court in the case of M/s Aryaverth Chawal Udyog and others (supra), which shows that on the date of passing of the assessment order, there was no material on record which suggest that the benefit accorded to the revisionist was against the interest of the revenue. The propriety and legality of any order can be tested under Section 10 B of the Act but the revisional jurisdiction in confined to the materials on record on the date of passing of such order. In the present case, proceeding under Section 10 B of the Act has only been initiated on the ground of subsequent judgement passed in the case of M/s Aryaverth Chawal Udyog and others (supra), which is not permissible under the Act and law laid down by this Court.
10. The Division Bench of this Court in the case of M/s A.K. Corporation and another Vs. State of UP and others, 1994 UPTC 75, relevant para of which, is quoted below:-
15.We have carefully perused the facts and the ratio laid down in the case of Ganga Properties v. Income-tax Officer, [1979] 118 ITR 447 (Cal) and we find ourself in full agreement with the view taken therein that revisional jurisdiction is confined to the materials on record and will empower the authorities under the Act only to satisfy itself about the correctness, propriety and legality of the or-der and will not empower the authorities for initiating the proceedings for rectification or reassess-ment. In the instant case, the turnover of the assessee for the assessment year in question was fully ex-amined and after full scrutiny, the same was subjected to tax by the Sales Tax Officer, and subse-quently if it was found on the basis of material not already on record that a part of the turnover of the assessee had escaped assessment then the only course available to the authorities under the Act was to issue notice under section 21 of the Act for assessment but the impugned notice issued under section 10-B of the Act could not have been issued as there appears to be no illegality or impropriety in the assessment order passed by the Sales Tax Officer.
11. Section 10 B of the Act confers the jurisdiction to examine the legality and propriety of the order passed by the assessing authority. The legality and propriety of the order has to be decided with regard to the material that was available on record as it existed on the date of passing of the assessment order and not afterwards or some new material of law. The case in hand, admittedly, judgement was pronounced by this Court after passing of the original assessment order, therefore, the proceedings cannot be justified in the eyes of law.
12. Similar view has been taken by this Court in the case of Commercial Trade Tax UP Lucknow Vs. M/s Assam Bengal Roadway, 2003 NTN (vol 23 ) page 919 and Commissioner Trade Tax UP Vs. S/S Kamal Agencies Saharanpur (2005) 41 STR 658 and M/s Smart Carpet Allahabad Vs. Commissioner of Trade Tax, 1999 UPTC 1203
13. Further Division Bench of this Court in the case of M/s Samsung India Electronics Pvt. Ltd. Vs. State of UP and others, 2017 UPTC 63 has held that subsequent judgement cannot be used to reopen assessment or to disturb past assessments, which have been concluded. Relevant para of the said judgement is quoted hereunder:-
11. Further, a subsequent judgment cannot be used to reopen assessments or disturb past assessments which have been concluded. [See Para 7, Austin Engineering V. JCIT (2009) 312 ITR 70 (Guj.) Para 4 and 5, Bear Shoes 2011 (331) ITR 435 (Mad.), B.J. Services Co. Middle East Ltd. v. Deputy Director (2011) 339 ITR 169 (Uttarakhand), Sesa Goa V. JCIT 2007 (294) ITR 101 (Bom.), Geo Miller and Co. 2004 (134) Taxmann 552 (Cal)]. Reliance is also placed on the decision of the Hon'ble Supreme Court in MEPCO Industries V. CIT, (2010) 1 SCC 434, where the CIT on the basis of a subsequent decision of the Supreme Court sought to rectify his earlier order. The Hon'ble Court held that this would amount to a change of opinion.
14. In view of the aforesaid facts as well as the law laid down as referred herein above, the proceedings under Section 10 B restricts the jurisdiction of the authority to scrutinize the records already in existence with the assessment authority on the date of passing of the assessment order and not on the material found subsequently or order being passed subsequent thereto.
15. In view of above, the impugned orders passed by the Commercial Tax Tribunal in all the aforesaid revisions cannot be sustained in the eyes of law and same are hereby set aside.
16. Accordingly, all the revisions are allowed.
17. The questions of law are answered in favour of the revisionists and against the revenue.
18. Any amount deposited by the revisionists shall be refunded to the revisionists within a period of one month from the date of production of certified copy of this order, in accordance with law.
Order Date :-17.5.2025
Rahul Dwivedi
