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PETITIONER: THE ASSISTANT COMMERCIAL TAX OFFICER-CUM-ENTERTAINMENTTAX OF

       Vs.

RESPONDENT: SHRI NARASIMHAIAH & ORS.

DATE OF JUDGMENT:       02/04/1997

BENCH: K. RAMASWAMY, D.P. WADHWA

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      These appeals  by special  leave arise from  the common judgment of  the Division Bench of the Karnataka High Court, made on September 13,1985 in Writ Appeal Nos.1640-46/85.      The admitted  position is that legislature of karnataka introduced Section  6-B in  the Karnataka Entertainments Tax Act, 1958  by Amendment Act, 1966 (Karnataka Act 14 of 1966) with effect from May 16, 1966 which reads as under:      " 6-B  payment for admission, etc.,      escaping assessment -(1) where, for      any reasons,  (1) any complimentary      ticket or any payment for admission      to any  entertainment  has  escaped      assessment to  tax under  section 3      or Section 3-A or      (ii)  any  cinematograph  show  has      escaped  assessment  to  tax  under      Section 4 or 4-A or      (iii) such  ticket, payment or show      has been  assessed at  a rate lower      than  the   rate  at  which  it  is      assessable  under   section  3   or      Section 3-A or Section 4 or Section      4-A.      The authority prescribed under sub-      section(1)  or   Section  6-A  may,      subject to  the provisions  of sub-      section (2)  and at any time within      such period  as may  be prescribed,      assess or re-assess, to the best of      its judgment,  the rate due on such      ticket,  payment   or  show   under      Section 3 or Section 3-A or section      4 or Section 4-A as the case may be      , after  service of  notice on  the      proprietor and  after  making  such      enquiry,   as   it   may   consider      necessary."      Reassessment of escaped turn-over was sought to be made by  operation   of  Notification  No.  FD.194  CEX-76  dated

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30.11.1976 amending  and framing Rule 29-F of the Rules made under the  Act prescribing  the period of limitation of five years. It reads as under:      "29-F. The  time within  which  the      power   under    Section   6B    is      exercisable  shall  be  five  years      from the  close of  the  period  to      which the  assessment  in  question      relates."      The respondents  contend that  the appellants  have  no power to  re-open the  assessment and  reassess the  escaped turnover beyond November 30, 1976. The said contention found favour with  the learned single judge, which was affirmed by the Division  Bench dismissing  the appeal  summarily. Thus, these appeals by special leave.      A reading  of Section  6-B of the Act clearly indicates that where  for any reasons, any complimentary ticket or any payment for  admission  to  any  entertainment  has  escaped assessment to  tax under  Section 3  or Section  3-A, or any cinematograph show  has  escaped  assessment  to  tax  under Section 4  or 4-A,  or such ticket, payment or show has been assessable under  Section 3  or 3-A  or Section 4 or 4-A, as the case  may be  , the authority has been given power under subsection (1)  of Section  6-A, to  reassess to the best of its judgment,  the rate  due on such ticket, payment or show under Section  3 or 3-A or section 4 or 4-A, as the case may be .  But it  should be done only after service of notice on the proprietor  and after  making such  enquiry  as  it  may consider necessary.  Since limitation  for the period during which the  escaped turnover  can be reassessed, had not been earlier prescribed,  Rule 29-F  was made  and had  come into effect from  November 30,1976.  As seen under Rule 29-F, the time within  which the power under Section 6B is exercisable has been  prescribed, "shall be five years from the close of the period  to which the assessment in question relates." In other words, it relates backward to five years from the date the Rule  came into  force from  November  30,1976.  If  the interpretation given  by the  High Court is given effect to, the  amended  Rule  29-F  would  come  into  force,  namely, November 30, 1976, five years forward. That would not be the intendment of  the Rule. As a consequence, the High Court is clearly in error in holding that reassessment of the escaped turnover preceding  five years from November 30, 1976 is not correct.      The appeals  are, therefore,  allowed. The  authorities are empowered  to reassess  the  escaped  turnover  for  the period, five  years preceding  November 30, 1976 as relating to the assessment in question. No costs.