DEPUTY COMMISSIONER OF COMMERCIAL TAXES versus H. R. SRI RAMULU

Citation: [1977] 2 S.C.R. 593 · Decided: 11-01-1977 · Supreme Court of India · Bench: HANS RAJ KHANNA · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

t 
593 
DEPUTY COMMISSIONER OF COMMERCIAL TAXES 
A 
v. 
H. R. SRI RAMULU 
January 11, 1977 
(H. R. KHANNA, P. K. GOSWAMI AND P. S. KAILASAM, JJ.] 
Limitation-Star:i11g poi/// for computing tlie period of four years mentioll-
ed ins. 21(3) for tlie exercise of revisio11al powers under s. 21(2) against an 
<Jrder under s. 12A of th,e Mysore Sales Tax Act 1957 in respect of an escaped 
turnover-Whether i11itial assessment order or an order made under s. 12A is 
1he starting poillf for computation. 
In respect of the assessment years 1959-60 and 1960-61, fresh assessments 
were made under s. 12A of the Mysore General Sales Tax Act 1957 
by 
the 
Commercial Tax Officer. 
By his order dated June 8, 1966, certain 
amounts 
which had escaped assessment under the .original 
assessment 
orders 
dated 
March 21, 1963 were included in the turnover of the respondent, but the deduc-
tions in respect of shop rent and tree tax were, however, allowed as 
in 
the 
initial orders. The appellant, in exercise of the powers under s. 21 (2) of the 
Act, by his orders dated 'June 28, 1967 revised the orders dated June 8, 1966 
disallowing the deductions in respect of the, shop rent, following the decision 
of this Court in Shinde Brother etc. v. Deputy Commissioner Raic/1ur [1967] 
I S.C.R. 548. 
Two rectification applications and the two appeals therefrom on 
the ground that the revisions of assessment were barred by 
limitation under 
s. 21 (3) of the Act and, as such, there was a mistake apparent on the record 
were rcj~cted as not maintainable. However, the writ 
petitions 
filed 
were 
allowed by the High Court holding that the orders dated June 28, 1967 were 
without jurisdiction since they had been made beyond 
the 
period 
of four 
years from the date of the initial assessment orders dated March 21, 1963. 
On appeals by special leave to this Court, 
HELD : The contention advanced on behalf of the 
appellants 
that the 
period of four years mentioned in s. 21 (3) of the Act should 
be computed 
from the orders dated June 8, 1966 made under S. I 2A cf the Act 
and not 
from the initial orders of assessment dated March 21, 1963 is well-founded. 
[5'}5 C-DJ 
B 
c 
D 
E 
Once an assessment is reopened, the initial order for assessment ceases to 
be operative. 
The effect of reopening the assessment is to vacate or set a£ide 
the initial order for assessment and to substitute in its place the order made 
F 
on reassessment. The initial order for reassessmellt cannot be said to survive 
even partiallv although the justification for dessessment arises because of turn-
over escaping assessment in a limited field or only with respect to a part of the 
matter covered by the initial assessment order. The result of reopening 
the 
assessment is that a fresh order for reassessment would 
have 
to 
be 
made 
including for those matters in respect of which there is no allegation of , the 
t1m1over escaping assessment. 
[596 D-E] 
Jn the present case the assessment orders made under s. 12A were compre-
·G 
.fllensive orders and were not confined merely to matters which 
had escaped 
assessment earlier and the only orders which couTd be the 
subject-matter of 
revision by the appellant were the orders made under s. l 2A of the Act and 
not the iuitial assessment orders. 
[596 E-FJ 
J. Jaganmohan Rao & Ors. v. Commissioner of income-tax and Excess 
Profitr Tax, A ndhra Pradesh [1970] l S.C.R. 726=75 ITR 373; Commissioner 
of Sales Tax, Madhya Pradesh v. H. M. Es11fali H. M. Abd11/ali [1973] 3 S.C.R. 
H 
1005=90 ITR 271, followed. 
lntemational Cotton Co_rporation (P) Ltd. v. Commercial Tax Officer, Hubli 
& Ors. [1975] 2 S.C.R. 345, applied. 
594 
SUPREME COURT REPORTS 
( 1977] 2 S.C.R. 
A 
CIVIL APPELLATE JURISDICTION: 
Civil Appeal Nos. 145-146/ 
1972. 
(Appeals by Special Leave from the Judgment and Order dated 
9-12-1970 of the Mysore High Court in Writ Petitions Nos. 2042 
and 2065 /70). 
B 
Narayan Nettar, for the appellant. 
c 
D 
E 
F 
G 
H 
R. M. Mehta, for the respondent. 
The Judgment of the Court was delivered by 
KHANNA, J.-These two appeals by special leave are against the 
common judgment of the Mysore High Court whereby the High Court 
in two petitions under article 226 of the Constitution of India quashed 
two orders made by the Deputy Commissioner of Commercial Jaxe> 
appellant under section 21 of the 
Mysore Sales 
Tax Act, 
1957 
(hereinafter referred to as tlie Act) . 
The respondent is an ekise contractor. 
He was assessed 
under

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