Rectification of Mistake RST/VAT Act

29 Tax Up – Date 253 ACTO Vs. M/s. Makkad Plastic Agencies

 Rajasthan Sales Tax Act,1994, section 37- Rectification of mistake –while allowing the appeal of the revenue, the supreme court held that:-

The scope and ambit of the power which could be exercised under section 37 of the act of 1994 is circumscribed and restricted within the ambit of the power vested by the said section. Such a power is neither a power of review nor is akin to the power of revision but is only a power to rectify a mistake apparent on the face of the record. Rectification implies the correction of an error or a removal of defects or imperfections. It implies an error, mistake or defect which after rectification is made right.

When the subsequent order dated 22.01.2009 passed by the taxation board is analysed  and scrutinized it would be clear/apparent that the Taxation Board while passing that order exceeded its jurisdiction by re-appreciating the evidence on record and holding that there was no mala fide intention on the part of assessee-respondent for tax evasion. Such re-appreciation of the evidence to come to a contrary finding was not available under section 37 of the Act of 1994 while exercising the power of rectification of error apparent on the face of the records.

The order passed by the Taxation Board on 22.01.2009 as also the impugned order and judgment passed by the High Court upholding the said holder of the Taxation Board are hereby set aside and quashed and the original order passed by the Assessing Officer is restored.

M/s Shakti Iron Trading Co. Vs. Assistant Commercial Taxes officer, Circle III-Anti Evasion  (1999) 4 Sales Tax Today 146 (RTB):

An application u/s  37 was filed. No mistake of law or facts apparent on the face of record was mentioned in the application. Instead the application was, in effect, for reconsideration of the decision – whether a decision could be reviewd u/s 37 – Held -  u/s 37 of RST Act, 1994 a mistake of law or facts apparent on the face of the record can be rectified and under the cover of rectification a well considered decision cannot be reviewd. Appeal rejected.

7 RTJS 366:

RST Act, Sec. 17 – Rectification scope limited – only mistake apparent from record, which can be detected , without deep probe or detailed arguments, rectifiable, but the mistake of judgement or mistake in application of law cannot be rectified.