Case Law Details
R.K. Industries Vs State of Odisha (Orissa High Court)
The factual finding by the JCST was that the reopening of the assessment was done by the AO by simply accepting the objection of the AG (Audit) without forming independent opinion on whether such objection by the AG (Audit) was correct or not. There was no recording by the Addl. STO about being satisfied independently then there was escapement of taxable turnover. The legal position in this regard has been explained by this Court in Indure Ltd. v. Commissioner of Sales Tax, [2006] 148 STC 61 (Orissa) where it has been held that an objective opinion has to be formed by the STO and that he cannot “totally abdicate or surrender his discretion to the objection of the audit party by mechanically reopening assessment under Section 12(A) as has been done in this case.” It may be noticed here that the above observation was made in the context of Section 12(8) of the OST Act which corresponds to Section 43 of the OVAT Act.
In the above circumstances, simply remanding the matter to the STO as has been done by the JCST would serve no purpose since in no way would that alter the factual position namely, that in the record sheet there would be no recording of the objective opinion of the STO about escapement of taxable turnover.
In that view of the matter while setting aside the order of the Tribunal as well as the JCST and the corresponding assessment order, this Court disposes of the revision petition by answering the question framed in the negative i.e. in favour of the Dealer and against the Department.
FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT
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