ASSISTANT COMMERCIAL TAXES OFFICER versus M/S MAKKAD PLASTIC AGENCIES

Citation: [2011] 4 S.C.R. 663 · Decided: 29-03-2011 · Supreme Court of India · Bench: MUKUNDAKAM SHARMA · Disposal: Appeal(s) allowed

Judgment (excerpt)

• 
(2011] 4 S.C.R. 663 
ASSISTANT COMMERCIAL TAXES OFFICER 
A 
v. 
M/S MAKKAD PLASTIC AGENCIES 
(Civil Appeal No. 2692 of 2011) 
MARCH 29, 2011 . 
[DR. MUKUNDAKAM SHARMA AND 
ANIL R. DAVE, JJ.] 
B 
Rajasthan Sales Tax Act, 1994: s.37 - Rectification of 
error apparent on the face of the record - Exercise of power C 
vested u/s.37 - Scope and ambit- Held: The scope and ambit 
of the power u/s.37 is circumscribed and restricted within the 
ambit of the power vested by the said Section - Such a power 
is neither a power of review nor is akin to the power of revision 
but is only a power to rectify a mistake apparent on the face o 
of the record and for which re-appreciation of the entire 
records is neither possible nor called for - Rectification 
implies the correction of an error or removal of defects or 
imperfections -
In the instant case, the Taxation Board 
passed an order against assessee whereby it upheld the E 
demand of differential tax and imposition of penalty as done 
by assessing authority -
Assessee filed rectification 
application uls. 37 before the Board - The Board modified its 
earlier order to the extent that as the assessee had declared 
all his sales in the books of accounts, imposition of penalty F 
was not justified - While passing the subsequent order, the 
Board exceeded its jurisdiction by re-appreciating the 
evidence on record and holding that there was no ma/a fide 
intention on the part of assessee-respondent for tax evasion 
- Such re-appreciation of the evidence to come to a contrary 
finding was not available uls.37 while exercising the power of G 
rectification of error apparent on the face of the record - Thus, 
the subsequent order passed by the Board as a/so the 
judgment passed by the High Court upholding the said order 
663 
H 
• 
664 
SUPREME COURT REPORTS 
(2011] 4 S.C.R. 
A of the Board set aside and the original order passed by the 
Assessing Officer restored - Review. 
Review: Maintainability of - Held. Review is a creature 
of the statute - An order of review could be passed only when 
8 
an express power of review is provided in the statute - In the 
absence of any statutory provision for review, exercise of 
power of review under the garb of clarification/modification! 
correction is not permissible. 
c 
Words and phrases: Rectification - Meaning of 
The assessing officer passed the assessment order 
that the articles sold by the assessee-respondent 
attracted the sales tax of 10% instead of 8% paid by 
assessee treating them as separate articles from plastic 
o goods. The demand was made for the difference of tax 
at 2% alongwith surcharn,e, interest and penalty. The 
appellate authority set aside the assessment order. On 
appeal, the Taxation Board by its order dated 13.5.2008 
restored the assessment order holding that "plastic 
E goods" and "thermoware" were two different articles as 
was indicated from the invoice itself. 
The assessee filed a rectification/amendment 
application under Section 37 of the Rajasthan Sales Tax 
Act, 1994. The Taxation Board decided the said 
F 
application on 22.1.2009 and modified its earlier order to 
the extent that as the assessee had declared all his sales 
in the books of accounts, in order to levy penalty, the 
department could not show that there was a malafide 
intention on the part of the assessee. Accordingly, it held 
G that the order of levying penalty was not justified. 
H 
Aggrieved, the appellant filed revision before the High 
Court, which was also dismissed. 
The question which arose for consideration in the 
•
• 
ASSISTANT COMMERCIAL TAXES OFFICER v. MAKKAD 665 
PLASTIC AGENCIES 
instant appeal was whether, while exercising power 
A 
vested under Section 37 of the Act, the Taxation Board 
could re-appreciate the evidence on record and review 
its earlier order to hold that there was no mens rea on the 
part of the assessee and no penalty was leviable on it. 
Allowing the appeal, the Court 
B 
HELD: 1.1. The exercise of power vested under 
Section 37 of the Rajasthan Sales Tax Act, 1994 by the 
Taxation Board in the instant case by interfering with its 
earlier order was a jurisdictional error and also an 
C 
exercise of power in excess to what is provided in the 
statute. The scope and ambit of the power which could 
be exercised under Section 37 of the Act is circumscribed 
and restricted within the ambit of the power vested by the 
said Section. Such a power is neither a power of review 
D 
nor is akin to the power of

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