Property owner's claim rejected

LEGAL DIGEST

The Supreme Court held last week that when a property had been compulsorily purchased by the income tax department and sold in public auction and the money had been refunded to the owner, there could be no further challenge to the action of the department. This followed from the ruling of the court in the CB Gautam vs Union of India case, (1993).

In this case, Krishnaswamy vs Union of India, the property was agreed to be sold for Rs 18 lakh. The owner declared so in Form 37-I of the income tax rules.

Thereafter, the authority exercised its power under Section 269UD(1) of the Income Tax Act for pre-emptive purchase of the property at an amount declared by the owner. It was sold in auction for Rs 46 lakh and the declared amount was given to the owner and he accepted it.

Then he challenged the government action in the Karnataka High Court, arguing that he was not given the grounds for the pre-emptive step. It was dismissed.

The Supreme Court also rejected the contention of the owner stating that after the transaction was complete and the owner accepted the amount, he could not raise such an objection.

Gammon India asked to pay Rs 1.5 crore

The Supreme Court last week directed Gammon India Ltd to pay a lump sum of Rs 1.5 crore within a month to the Andhra Pradesh sales tax authorities pending the adjudication of its appeal against four notices and penalty and attachment orders.

The state authorities issued notices to the company for filing false statements to claim reduced sales tax on the purchase of cement. While the dispute was pending the AP General Sales Tax Act was repealed and the value-added tax provisions came into force in its place.

Then the issue was raised by the company whether the commercial tax authorities had the jurisdiction to complete the penalty proceedings.

The Supreme Court held that the commercial tax officer did have the power as the value-added tax law merely replaced the old law. Whenever there was a repeal and simultaneous re-enactment, the old provisions continued in force unless they were incompatible with the new law, the Supreme Court said.

APtransco wins case against rice mill

The Supreme Court held last week that a consumer accused of pilferage of electricity had a limited right to cross examine the officers who assessed the dues.

In this case, Transmission Corporation of Andhra Pradesh Ltd vs Sri Rama Krishna Rice Mill, the company's request for cross examination of the officials responsible for the assessment was rejected by the authorities.

The company moved the high court, which ruled that the assessee was entitled to cross examination. The transmission corporation appealed to the Supreme Court against it.

In its judgment, the apex court ruled that when the decision of the authorities was based on reports alleging tampering or pilferage, the consumer might be shown the documents and pinpoint the officials to be cross examined. But applications for cross examination should not be filed in a routine manner nor should they be rejected in a casual way.