Jaswant Singh, J. - (1.) These two appeals Nos. 669 and 670 of 1971 by special leave from the common judgment dated June 11, 1970, of the High Court at Calcutta in Sales Tax References Nos. 395 of 1965 and 521 of 1967 which raise important questions as to the scope and extent of the revisional power of the Commissioner, Commercial Taxes, under Section 20 (3) of the Bengal Finance (Sales Tax) Act, 1941 (Act VI of 1941) (hereinafter referred to as 'the Act'). shall be disposed of by this judgment.
(2.) The facts giving rise to these appeals are:The appellant which is a Private Limited Company, incorporated under the Indian Companies Act, 1913, and is registered as a dealer under the Act submitted a return for 4 quarters ending with the last date of Chaitra, 1364 B.S. (corresponding to the period commencing with April 14, 1957, and ending with April 13, 1958) showing a gross turnover of sales of Rupees 35,93,402/-. By his order dated December 7, 1959, the Commercial Tax Officer, Rajakatra Charge, rejected the appellant's books of accounts on the ground of absence of purchase and sale vouchers and of stock statements and enhanced the gross turnover shown by the appellant by Rs. 50,000/- and charged the entire enhanced amount to tax subject to deduction under Section 5 (2) (b) of the Act. He also imposed a penalty of Rs. 1,000/- under Section 11 (1) of the Act. On appeal under Section 20 (1) of the Act, the Assistant Commissioner, Commercial Taxes, Burrabazar Circle, by his order dated September 10, 1960, reduced the enhancement of gross turnover from Rs. 50,000/- to Rs. 25,000/- and the penalty from Rs. 1,000/- to Rupees 500/-. Not satisfied with this reduction, the appellant moved the Commissioner, Commercial Taxes, West Bengal, in revision under Sec. 20 (3) of the Act on November 10, 1960, Before the filing of the said revision petition, the Commercial Tax Officer, Central Section to whom power under Section 14 (1) of the Act has been duly delegated started an enquiry on January 20, 1960 and served on the appellant a notice dated October 25, 1960 to the following effect:- "You are hereby directed to furnish the undersigned with the serial Nos. of the cash memos. printed by you in 1363 B.S., 1364 B.S., 1365 B.S. 1366 B.S. and 1367 B.S. The names of the suppliers of these memos, relevant bills Nos. and dated, amount, dates of payment and modes of payment also are to be indicated. The information may be supplied to the undersigned on 31st October, 1960 at 4 p.m. positively."
(3.) In response to the notice, the appellant appeared before the Commercial Tax Officer, who after hearing the former and examining the cash memos and other material submitted a report of the investigation made by him to the Assistant Commissioner, Central Section observing inter alia that two original cash memos issued by the appellant bearing serial No. 30727-26 dated January 24 for Rs. 69.50 in respect of sale of Banarsi Saree and No. 31310-37 dated December 25, 1966 for Rs. 62.20 in respect of sale of ready-made garments were not properly recorded in the appellant's books of accounts and records and that on reference to the appellant's books of accounts and cash memos, it had been found that cash memo. No. 30727-26 was issued in respect of mill-made cloth for Rs. 11.75 on August 18, 1964 and not in respect of Banarsi saree for Rs. 69.50 on January 24 and cash memo. No. 31310-37 was issued in respect of sale of mill-made cloth for Rs. 9.37 and not in respect of sale of ready-made garments for Rs. 62.20 on December 25, 1966. He also observed in his report that in cash memo. No. 31310-37, the date appeared to have been tampered with by subsequent insertion of the numerals "66" after the date of issue and that the actual date appeared to the be December 25 and that the appellant had not been able to furnish a satisfactory explanation with regard to these discrepancies. The Commercial Tax officer further stated in his report that his investition revealed that the appellant got duplicate sets of 1,00,000 cash memos bearing serial Nos. 28501 to 29500 and 30501 to 31500 printed and supplied by M/s. Blackwoods India Limited and did not record sales to the extent of Rs. 30,00,000/- which in the absence of any evidence to the contrary appeared to be entirely taxable. This report was received by the Additional Commissioner, Commercial Taxes, while the aforesaid revision petition was still pending before him. He, thereupon gave the following notice to the appellant:- "On discovery of fresh materials, as reported by the Commercial Tax Officer, Central Section, in his report dated 27-12-60 (copy enclosed), it appears that you have suppressed sales estimated to be Rs. 30,00,000 in respect of the assessment of four quarters ending Chaitra 1364 B.S. The above revision petition which has been filed before me is against the appellant order in respect of the assessment for the said period ... It also appears that sales to the extent of Rs. 30,00,000 (estimated) escaped taxation from the original assessment and consequently from the Assistant Commissioner's appellate order. The above revision petition will be heard by me on 5-10-61 at 11.30 a.m. and the report dated 27-12-60, submitted by the Commercial Tax Officer, Central Section, will be considered at the time of hearing of the revision petition. You should, therefore appear before me on that date at the hour fixed either in person or by a duly instructed agent to represent your case, failing which the matter will be decided ex parte without any further reference to you.";