Balasubrahmanyan, J.:— This case arises under the Central Sales Tax Act, 1956. A turnover of Rs. 3,10,495.38 which represents sales turnover by the assessee to registered dealers in other States was subjected to tax at 2½ per cent for the assessment year 1966-67. Although C form declarations covering that turnover had not been filed by the assessee before the assessing authority, the order of assessment was taken in appeal by the assessee on some other matter. The Appellate Assistant Commissioner disposed of the appeal, but he did not find out whether Rs. 3,10,495.38 taxed at the concessional rate of 2½ per cent was covered by C form declarations at all. Against the order of the Appellate Assistant Commissioner the assessee went up in further appeal before the Tribunal apparently to agitate some other questions. At that stage, the State Government filed an enhancement petition before the Tribunal pointing out that the turnover of Rs. 3,10,495.38, which was taxed at the concessional rate of per cent was wrongly given that concession and it ought to have been taxed at the rate of 10 per cent considering that the turnover was not covered by the production of C form declarations by the assessee. This contention was negatived by the Tribunal on the score that the enhancement ought properly to have been done by the Appellate Assistant Commissioner at the first appellate stage Page: 218and since this was not done, the matter could not be agitated at the second appellate stage before the Tribunal.
2. In this revision filed by the State Government, it is contended by the learned Government Pleader that the power of the Appellate Tribunal to enhance the assessment while disposing of an appeal is not fettered by any condition that an attempt of enhancement ought to have been made even at an earlier appellate stage before the Appellate Assistant Commissioner. This contention is well-founded both on the phraseology of section 36 of the Sales Tax Act and on the authorities Section 36(3), which enumerates the different ways in which the Appellate Tribunal may give a disposal to the appeal before it, lays down that the Tribunal has the power to “confirm, reduce, enhance or annul the assessment” in the case of an order of assessment. What was taken up in the second appeal by the assessee before the Appellate Tribunal in this case was certainly an order of assessment.
3. Therefore, in disposing of that appeal, the Tribunal certainly had the power, among others, to enhance the assessment. This power of enhancing an assessment is not subject to any limitations whatsoever, which we can gather from the terms of section 36(3). We find no justification for the theory that the Tribunal can exercise the power of enhancement only in a case where the Appellate Assistant Commissioner at an earlier stage had entered into the question of enhancement and had ultimately abandoned it. There is no logic behind the view that an enhancement cannot be made by the Tribunal for the first time for, if an enhancement had already been made by the Appellate Assistant Commissioner, there is no question at all of an enhancement having to be made by the Tribunal subsequently. Alternatively, if the Appellate Assistant Commissioner had dropped the idea of enhancing, the fact that he had considered the matter, does not improve matters for either party. The real question, therefore, is whether the power of enhancement conferred on the Tribunal by section 36 is shackled by any condition. The text of the section, which we have summarised above, does not contain any limitation or restriction on the power of the Tribunal to make an enhancement of assessment if the appeal relates to an order of assessment. This position is also covered by the authority of a Bench of this Court in Deputy Commissioner v. Panayappan Leather Industries, [1981] 47 STC 88. The result is that the Tribunal will have to entertain the enhancement petition on merits and dispose it of in accordance with law. The revision is accordingly allowed with costs. Counsel's fee Rs. 250.
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