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2001 DIGILAW 1580 (AP)

Prabhat Talkies, MVP Colony, Visakhapatnam v. Appellate Deputy Commissioner, Kakinada, Visakhapatnam

2001-12-05

P.S.NARAYANA

body2001
P. S. NARAYANA, J. ( 1 ) HEARD Smt K. Uma for the revision petitioner and also the learned Government Pleader for Commercial Taxes. ( 2 ) THE Civil Revision Petition is filed under Section 9-D of the A. P. Entertainment Tax Act, 1939. The revision petitioner had filed the Civil Revision Petition as against the order of the Appellate Deputy Commissioner (CT), Kakinada, at Visakhapatnam, on 9-10-2000 passed in Appeal No. VSP 9/95-96 (APET ). ( 3 ) THE facts in brief are that the revision petitioner was an exhibitor of films paying tax under A. P. Entertainment Tax Act, 1939 (hereinafter referred to as act in short for the purpose of convenience) during the years 1986-87 to 1988-89 and the petitioner was paying entertainment tax under Section 5 (1) of the Act. It is also stated that for the year 1987-88, the weekly tax was Rs. 9,226. 00 and for the year 1988-89, the weekly tax was Rs. 14,527. 00 and during the relevant period, rebate was permissible at 20% to 50% for screening second run and repeat run Telugu films, which are more than 5 years/10 years old. Under Section 5 of the Act, the weekly tax is computed as a percentage of gross collection capacity and multiplied by the stipulated multiplier in the table occurring in Section 5 (1) of the Act and in the case of the petitioner, the multiplier was 21 and as such, weekly tax was payable irrespective of the actual number of shows screened. In fact, the petitioner had claimed relevant rebate on the basis of 21 shows along with returns and paid the applicable, taxes. While so, by notice dated 27-5-1992, the Entertainment Tax Officer proposed to re-compute the rebate taking into account actual number of shows screened during the week, which is normally 28 shows and, no doubt, the petitioner had disputed the calculations and no further action was taken by the then Entertainment Tax Officer. ( 4 ) HOWEVER, the successive officer in the office of the Entertainment Tax Officer, had issued an order dated 15-2-1994 which, in fact, reads as follows:"m/s. Prabhat Talkies, Visakhapatnam were already informed in this office notice cited that they were allowed excess rebate for the second run/repeated run pictures as per the details given below: ( 5 ) BUT so far you have neither paid the differential amount of Rs. 23,953. 23,953. 00 nor file any objections in this regard. However with a view to afford final opportunity you are hereby requested to file your objections, if any, before the undersigned against the proposed assessment within seven (7) days from the date of receipt of this notice, Jailing which, action will be taken to recover the amount as per the provisions of APGST Act. Accordingly a notice was issued to the dealer. The dealer received the notice and filed no objections. Hence, orders passed accordingly. ( 6 ) UNFORTUNATELY, even in relation to this order, several objections had been raised by the revision petitioner while advancing arguments. Be that as it may, aggrieved by the said Proceedings dated 15. 2. 1994, the Petitioner had filed appeal before the respondent-herein, the appellate Deputy Commissioner (CT) Kakinada, at Visakhapatnam, and in the said appeal, the appellate authority had made the following order. "when the case has been Posted for hearing, Sri S Rama Rao, STP and authorized representative appeared before me and stated that the assessment under APET Act is required to be made every quarter and passing of consolidated orders for three years is unjust because it does not contain the total amount of tax assessed, amount paid and the balance due, that show-cause notices were issued separately for each of the Years 1987-88, 1988-89 on 26-5-1992 and the appellants were under the impression that further action was dropped on the basis of the details furnished by them in reply to the show-cause notices and that they received final assessment proceedings after a lapse of four years and that therefore, the assessment made for all the three years are time barred. He has finally stated that the appellants have since closed their theatre in the year 1989 itself, it was dismantled and fresh business complex was constructed therein and it was under the occupation of several business concerns. He has therefore, stated that at this stage, the appellants do not have any record whatsoever to produce the same for its perusal. He has finally stated that the appellants have since closed their theatre in the year 1989 itself, it was dismantled and fresh business complex was constructed therein and it was under the occupation of several business concerns. He has therefore, stated that at this stage, the appellants do not have any record whatsoever to produce the same for its perusal. I have heard him and in view of the fact that the appellants expressed inability to prove the several contentions, putforth by them in the appeal and as the assessments made by the Entertainment Tax Officer are found to be valid and were made according to law, I do not find any valid reasons to go into the merits of the case and in view of the above facts the appeal is dismissed. " ( 7 ) THE present revision is preferred under Section 9-D of the Act being aggrieved by the said order. The learned Counsel for the revision petitioner had taken me through the orders made by both the original authority and the appellate authority and had pointed out non-consideration of the irregularities and also non-consideration of the question of limitation and non-observance of the Principles of natural justice. The learned Counsel had contended that the order of the Entertainment Officer itself is unsustainable inasmuch as the order was made beyond three years after closure of the financial year and Rule 16 of the A. P. Entertainment Tax Rules (hereinafter in short referred to as rules ), contemplates a quarter as assessment unit and hence a consolidated order for several years cannot be passed. It was also contended that in the month of May, 1996, the revision petitioner had filed additional grounds that powers to pass orders relating to escaped assessment are limited to taxes under Sections 4 and 4-A of the Act, in fact, cannot be extended to theatres under Section 5 of the Act. But, however, though several important grounds have been raised, the appellate authority without adverting to any of the grounds raise by the- revision petitioner, had dismissed the appeal by making a non-speaking order without recording proper reasons. The learned Counsel further contended that even an order not supported by reasons should be taken as violative of principles of natural justice. But, however, though several important grounds have been raised, the appellate authority without adverting to any of the grounds raise by the- revision petitioner, had dismissed the appeal by making a non-speaking order without recording proper reasons. The learned Counsel further contended that even an order not supported by reasons should be taken as violative of principles of natural justice. No doubt, the learned Counsel representing the respondent had supported the impugned order stating that the appellate authority need not record reasons in detail and it is sufficient if the appellate authority had expressed an opinion concurring with the reasons recorded by the original authority. ( 8 ) HEARD both the counsel and perused the material available on record. Even a cursory glance at the impugned order clearly goes to show that the appellate authority had confirmed the order of the original authority without recording proper reasons and none of the contentions advanced by the revision petitioner had been adverted to or had been discussed by the appellate authority. In fact, Rule 16 of the Rules dealing with the final assessment on the basis of the returns reads as follows:"on receipt of the returns is Form VI, the assessing authority, if he is satisfied after such scrutiny of the accounts and after making such enquiry as he considers necessary, that the return is correct and complete, finally assess on the basis of the return the tax or taxes payable under the Act for each quarter, or for such period less than a quarter, as may be considered necessary, by the said authority. " ( 9 ) EVEN if it is stated as an escaped assessment, the limitation for assessment of escaped assessment has been dealt with by Rule 31 of the said rules. In any event of the matter, the period in which an assessment has to be made and also the question of limitation had not been discussed at all. The questions of law, which had been urged seriously by the revision petitioner in the present civil revision petition are as follows: 6. Questions of Law6. 1. Whether the Respondent failed to adjudicate the legal contentions of the petitioner regarding violation of principles of natural justice, irregularity of the common order passed by the Entertainment Tax Officer for several years and the issue of limitation?. 6. 2. Questions of Law6. 1. Whether the Respondent failed to adjudicate the legal contentions of the petitioner regarding violation of principles of natural justice, irregularity of the common order passed by the Entertainment Tax Officer for several years and the issue of limitation?. 6. 2. Whether the order dated 15-2-1994 is illegal and inconsistent since the second para of the order states that it is a show-cause notice and but the last para states that the orders passed as no objections are filed?6. 3. Whether Section 9-A of the Act providing for assessment of escaped tax has no application to exhibitors paying tax as per option and Section 5?6. 4. Assuming Section 9-A applies to the petitioner whether the order dated 15-2-1994 is patently barred by time for entire 1986-87 and for 3 quarters upto December, 1993 in 1987-88 under Rule 31 of Andhra Pradesh Entertainment Tax Rules which permits escaped assessment to be made within 6 years from the end of the quarter in question?6. 5. Whether the common order for 3 years is sustainable under rules when every quarter is an assessment unit?. ( 10 ) THE learned Counsel for the petitioner also had placed reliance on a decision of the division bench of this Court, to which I am also a party, in WP No. 13735 of 2001 dated 14-8-2001, wherein the importance of the observance of principles of natural justice had been discussed at length. Viewed from any angle, I am of the considered opinion that both the original authority and the appellate authority had not followed the proper procedure and had not decided the matter in accordance with law. ( 11 ) UNDER Section 9-D (4) (a) of the Act, if the High Court does not dismiss the petition summarily, it shall, after giving both parties to the petition a reasonable opportunity of being heard, determine the question of law raised and either reverse, affirm and amend the order, against which the petition was preferred, or remit the matter to the appellate authority with the, opinion of the High Court on the question or questions of law raised, or pass such other order in relation to the matter as the High Court thinks fit. ( 12 ) AS already discussed by me supra, the questions of law specified above as grounds 6. 1 to 6. ( 12 ) AS already discussed by me supra, the questions of law specified above as grounds 6. 1 to 6. 5 are all questions of law, which should have been discussed in detail by the appellate authority and the appellate authority had failed in recording the reasons why such grounds had not been considered at all, and in the absence of reasons, I do not think that sitting as a revisional Court in this revision, all these reasons can be recorded, since it is the duty of the appellate authority to record all the reasons relating to all the questions raised by the revision petitioner. Hence, in the light of the nature of the order passed, it being a non-speaking order, which definitely is in violation of the principles of natural justice, the impugned order is liable to be set aside. But, however, the matter is remitted back to the appellate authority to consider and decide all the questions of law specified supra after giving reasonable opportunity to the concerned parties in this regard. ( 13 ) WITH the above observations, the civil revision petition is allowed to the extent indicated above. No order as to costs.