ADDITIONAL COMMISSIONER (LEGAL) AND ANR. versus M/S JYOTI TRADERS AND ANR. ETC.

Citation: [1998] SUPP. 3 S.C.R. 67 · Decided: 20-11-1998 · Supreme Court of India · Bench: K. VENKATASWAMI · Disposal: Appeal(s) allowed

Judgment (excerpt)

ADDITIONAL COMMISSIONER (LEGAL) AND ANR. 
A 
v. 
M/S JYOTI TRADERS AND ANR. ETC. 
NOVEMBER 20, I 998 
[K. VENKATASWAMI AND D.P. WADHWA, JJ.] 
B 
U.P. Trade Tax Act, 1948 
Section 21 (2)-Proviso (As inserted by UP Sales Tax (Amendment and 
Validation) Act, 1991-Scope of 
C 
Sales Tax-Reassessment-Period for-Assessment period of four years 
provided under the Act-Amendment of Act-Insertion of proviso-
Enlargement of period of assessment upto eight years under the proviso--
Held proviso was operative from the date of its coming into force relating 
and encompassing back to previous eight assessment years-Held even to D 
cases where the period of four years prescribed earlier had already expired 
before addition to the proviso-Assessment of respondent assessees for the 
assessment year 1985-86-Held could be re-opened upto 31.3.1994-Service 
of notice to assessee not a condition precedent. 
Taxing Statute-Interpretation of 
The question involved in these appeals is whether a completed 
assessment under the U.P. Sales Tax Law could be re-opened after the 
prescribed period when that period was enlarged by amending the law. The 
assessment of the respondent assessee for the year 1985-86 under the U.P. 
Trade Tax Act, 1948 was completed on November 27, 1989. In the connected 
appeal the assessee's assessment for the year 1985-86 was completed on 
February 28, 1989. The assessment period of four years provided under 
Section 21 of the Act for the assessment year 1985-86, expired on March 
E 
F 
31, 1990. By the U.P. Sales Tax (Amendment and Validation) Act, 1991 a 
proviso to sub-section (2) of Section 21 was inserted whereunder it was G 
7 . 
provided that the Commissioner of Sales Tax may authorise the assessing 
authority to make assessment or reassessment after the expiration of period 
of four years but not after the expiration of eight years from the end of such 
year notwithstanding that such assessment or reassessment may involve a 
change of opinion. The said proviso came into force with effect from February H 
67 
68 
SUPREME COURT REPORTS [19981 SUPP. 3 S.C.R. 
A 19, 1991. Subsequent to the amendment, Commissioner Sales Tax issued 
Sanctions dated December 12, 1993 and November 12, 1993 respectively for 
assessment of both the assessees. Consequently notices dated September 8, 
1994 and January 11, 1994 were also issued to both the assessees. As the 
sanctions given and notices issued were after niore than four years with 
B reference to the assessment year 1985-86 under the Act before its amendment 
the respondent-assessees challenged both the sanction orders as well as 
notices for reassessment before the Al!:-habad High Court. A Division Bench 
of the High Court allowed the petition filed by the respondent assessees and 
quashed the sanction orders of the Commissioner as well as notices issued 
by the Sales Officer. rt held that (I) sanction issued by the Commissioner 
C of Sales Tax for initiation of proceedings under Section 21 of the Act for the 
assessment year 1985-86 was barred by limitation and that the proviso to 
Section 21 (2) of the Act which had been introduced with effect from February 
19, 1991 was inapplicable to the Assessment year 1985-86 as the assessment 
order for this year had been made much before the introduction of the 
D 
proviso fo Section 21 (2) of the Act; (ii) when the period for assessment or 
reassessment for the year 1985-86 under Section 21 of the Act before 
insertion of the proviso to sub-section(2) thereof had expired on March 
31,1990, the amendment had no effect. Against the decision of the High 
Court appeals were preferred before this Court. 
E 
Allowing the appeals and setting aside the impugned Judgments and 
F 
Orders of the High Court, this Court 
HELD: I. The High Court was not right in quashing the sanction given 
by the Commissioner of Sales Tax and notices issued by the Assessing 
Authority in p11rsuance thereto. 182-D) 
2. Sub-section (2) of S. 21 and the proviso added to it do not leave 
anyone in doubt that as on the date when the proviso came into force, the 
Commissioner of Sales Tax could authorise making of assessment or 
reassessment before the expiration of eight years from the end of that 
G particulu assessment years. It is immaterial if a period for assessment or 
reassessment under sub-section (2) of Section 21 before the addition of the 
said proviso had expired. Here, it is the completion of assessment or 
reassessment under Section 21 which is to be

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