| Assessment of tax |
| (1) If the assessing authority is satisfied that any return submitted under Section 13 is correct and complete, he shall assess the amount of tax payable by the dealer on the basis thereof; but if the return appears to him to be incorrect or incomplete he shall, after giving the dealer a reasonable opportunity of proving the correctness and completeness of the return submitted by him and making such inquiry as he deems necessary, assess to the best of his judgment, the amount of tax due from other dealer . An assessment under this section shall be made only within a period of *[three years] from the expiry of the year to which the assessment relates. 1[Provided that notwithstanding the amendment made to sub-section (1) by the Andhra Pradesh Genaral sales Tax (Third Amendment) Act, 1995 the period for assessment under this sub-section shall continue to be four years for the years preceding to the year 1992-93.] 2[Provided further that the period for assessments under this sub-secion shall be two years for the assessments relating to the year 1999-2000 and one year for the assessments relating to 2000-2001 and 2001-2002.] 1. The bracketed words in sub-section (1) and the proviso were added by Act No.22 of 1995 w.e.f.1.4.1995. 2. Added by Act No.30 of 2001 w.e.f.1.4.2001. (1-A). Where the return submitted by a dealer includes the turnover or any of the particulars thereofwhich would not have been disclosed but for an inspection of accounts, registers or other documents of the dealer made by an officer authorised under this Act before the submission of such return, the assessing authority may,after giving an opportunity to the dealer for making a representation in this behalf, treat such return to be an incorrect or incomplete return within the meaning of sub-section (1) and proceed to take action on that basis. |
| See Rule 31(1) |
| Note: Sub-section (1-A) was inserted by Act 5 of 1968 w.e.f.1.7.1968. (2) When making an assessment to the best of judgement under sub-section (1), the assessing authority may also direct the dealer (to pay in addition to the tax assessed penalty as specified in sub-section (8)) on the turnover that was not disclosed by the dealer in his return. Note: The words in brackets were substituted for the words "to pay in addition to the tax assessed, a penalty not exceeding one and half times the tax due" by Act No. 16 of 1963 w.e.f.1.8.1963. (3) 1(Where any dealer liable to tax under this Act- (i) fails to submit return before the date prescribed in that behalf, or (ii) produces the accounts, registers and other documents after inspection, or (iii)submits a return subsequent to the date of inspection, the assessing authority may, at any time within a period of six years) from the expiry of the year to which assessment relates, after issuing a notice to the dealer and after such enquiry as he considers necessary, assess to the best of his judgment, the amount of tax due from the dealer on his turnover for that year, and may direct the dealer 2(to pay in addition to the tax so assessed penalty as specified in sub-section (8)). |
| See Rule 15(5) |
| Note: (1) The bracketed words were substituted for the words: "If no return is submitted by anydealer liable to tax under this Act before the date prescribed in that behalf theassessing authority may at any time within a period of four years" by Act 5 of 1968,w.e.f.1.7.1968. (2) The bracketed words were substituted for the words: "to pay in addition to the tax assessed, a penalty not exceeding one and half times the tax due" by Act 16 of1963 w.e.f.1.8.1963. (4) In any of the following events, namely, where the whole or any part of the turnover of a business of a dealer has escaped assessment to tax, or has been under-assessed or assessed at a rate lower than the correct rate, or where the license fee or registration fee has escaped levy or has been levied at a rate lower than the correct rate, the assessing authority may, after issuing a notice to the dealer, and after making such enquiry as he may consider necessary, by order, setting out the grounds therefor- |
| See Rule 31(6) |
| (a) determine to the best of his judgment the turnover that has escaped assessment and assess the turnover so determined; (b) assess the correct amount of tax payable on the turnover that has been under-assessed; (c) assess at the correct rate the turnover that has been assessed at a lower rate; (cc) assess the correct amount of tax payable, in a case where any deduction or exemption has been wrongly allowed; (d) levy the license fee after determining to the best of his judgment the turnover on which such fee is payable. (e) levy the registration fee that has escaped levy; (f) levy the correct amount of license fee or registration fee in a case where such fee has been levied at a rate lower than the correct rate. In addition to the tax assessed or fee levied under this sub-section, the assessing authority may also direct the dealer to pay a penalty as specified in sub-section (8) (4-A) Any assessment or levy under sub-section (4) shall be made within a period of four years from the date on which any order of assessment or levy was served on the dealer . Note: Sub-section (4-a) above was substituted by Act 14 of 1978 w.e.f.17.1.1978. The orginal sub-section(4-A) which was added by Act 26 of 1961 w.e.f.1.10.1961 and subs. by Act 16 of 1963 w.e.f.1.8.1963 read as follows: "(4-A) An assessment or levy under sub-section (4) shall be made- (a) within a period of six years from the expiry of the year to which the tax,licence fee or registration fee relates, if the event that has occasioned such assessment or levy has occurred on account of the failure of the dealer to disclose the turnover or any of the particulars correctly; and (b) within a period of four years from the expiry of the year aforesaid, if such event has occurred due to any causes." ((4-B)) Before issuing any direction for the payment of any penalty under sub-section (2) sub-section (3) or sub-section (4), the assessing authority shall give the dealer a reasonable opportunity to explain the omission to disclose the turnover or to furnish correctly any particulars and shall make such enquiry as he considers necessary. ((4-C)) The powers conferred by sub-section (4) on the assessing authority may, subject to the same conditions as are applicable in the case of that authority; be exercised also by any of the authorities higher than the assessing authority including (The Assistant Commissioner (intelligence), the Deputy Commissioner and the Joint Commissioner.) Note: Originally inserted as sub-sections (4-A) and (4-B) by Act 26 of 1961 w.e.f.1.10.1961 were renumbered as sub-sections (4-B) and (4-C) respectively by Act 16 of 1963 w.e.f.1.8.1963. The bracketed words in sub-section (4-C) were substituted for the words 'Deputy Commissioner and Joint Commissioner" by Act 18 of 1985 w.e.f.1.7.1985. ((5) Where an assessment under this section has been deferred on account of any stay order granted by the 1High Court in any case, or by reason of the fact that an appeal or other proceedings is pending before the 1High Court or the Supreme Court involving a question of law having a direct bearing on the assessment in question, the period during which the stay order was in force or such appeal or proceeding was pending shall be excluded in computing the period of four years (or six years as the case may be) specified in this section for the purpose of making the assessments.) Note: Sub-section (5) was added by Act III of 1958, w.e.f.1.4.1958. The words in brackets were inserted by Act 26 of 1961, w.e.f.1.10.1961. (6) It shall be lawful for the (Commissioner of Commercial Taxes) to direct, by general or special order, any assessing authority to defer assessment in respect of any class of goods or any class of dealers pending clarification by it of any question referred to it, if such question has a direct bearing on such assessment. The period between the date of such direction and the date on which such clarification has been received shall be excluded in computing the period of four years or six years, as the case may be, specified in this section for the purpose of making the assessment. Note: Sub-section (6) was inserted by Act 16 of 1963, w.e.f.1.8.1963. The bracketed words in sub-section (6) were substituted for the words 'Board of Revenue' by Act 14 of 1978, w.e.f.17.1.1978. (7) Where an assessment made under this section has been set aside (by any court or other competent authority under this Act for any reason) the period between the date of such assessment and the date on which it has been set aside shall be excluded in computing the period of four years or six years, as the case may be, specified in this section for the purpose of making any fresh assessment. Note: Inserted originally as sub-section (6) by Act 26 of 1961 w.e.f.1.10.1961 but was re-numbered as sub-section (7) by Act 16 of 1963 w.e.f.1.8.1963. The bracketed portion was subs. by Act No.5 of 1968 w.e.f.1.7.1968. ((7-A) Where there has been delay on the part of the dealer in the production of accounts and statements for the purposes of making the assessment, in the submission of reply or objections to the notice of assessment. (a) the period between the date of issue of first notice by the assessing authority calling for production of accounts and Statements and the date of actual production of such accounts and statements; and (b) the period between the date of issue of notice of assessment and the date of actual submission of reply or objections; shall be excluded in computing the period of four years or six years, as the case may be, specified in this section for the purpose of making the assessment. Note: Sub-section (7-A) was inserted by Act 18 of 1985, w.e.f.13.9.1985. 1((8) The penalty leviable under sub-section (2), sub-section (3) or sub-section (4) 2(......) (a)3 (shall not be less than three times but which may extend to five times the tax or the fee) due in a case where the assessing authority is satisfied that the failure of the dealer to disclose the whole or part of the turnover or any other particulars correctly, or to submit the return before the prescribed date, was willful; and (b)4shall not exceed one half of the tax or the fee due in a case where such failure was not willful; Provided that where such failure occurred due to a bonafide mistake on the part of the dealer , no such penalty shall be levied. Explanation: The expression 'assessing authority' occurring in this section shall, in relation to license fee or registration fee, be construed as referring to the licensing or registering authority, as the case may be, under this Act. Note: 1. Sub-section (8) was added by Act 16 of 1963 w.e.f.1.8.1963. 2.The words 'shall not exceed' were omitted by Act 18 of1985 w.e.f.1.7.1985. 3.Substituted for the words 'five times the tax or the fee' by Act 18 of 1985 w.e.f.1.7.1985. 4.Substituted for the words 'one half of the tax or the fee' by Act 18 of 1985 w.e.f.1.7.1985. 14-A. Assessment in cases of price variations: (1) Notwithstanding anything contained in Section 14, - (a) if a dealer receives in any year any amount due to price variations which would have been included in his turnover for any previous year if it has been received by him in that year, he shall within thirty days from the end of the year in which such amount is received submit a return in such form as may be prescribed to the assessing authority and thereupon the assessing authority shall proceed to assess the tax payable on such amount; (b) if the assessing authority is satisfied that any return submitted under clause (a) is correct and complete, heshall assess the amount of tax payable by the dealer on the basis thereof, but if such return appears to him to be incorrect or incomplete, he shall after giving the dealer an opportunity of proving the correctness and completeness of the return submitted by him and after making such inquiry as he considers necessary and taking into account all relevant materials gathered by him, assess to the best of his judgement, the amount of tax due from the dealer . An assessment under this clause, shall be made only within a period of *[three years] from the expiry of the period within which such return ought to have been submitted ; and (c) if no return is submitted by the dealer under clause (a) within the period of thirty days aforesaid, the assessing authority may at any time within a period of six years from the expiry of the period within which inquiry as he considers necessary, assess to the best of his judgement the amount of tax due from the dealer on the amount referred to in clause (a). (2) The provisions of Section 14 including penalty shall apply to assessment and re-assessment of escaped turnover under this section. *Subs. for 'four years' by Act No.22 of 1995 w.e.f.1.4.95. |
| See Rule 17-H and Form A-7 |
| 14-B. Assessment of sales shown in accounts at low prices : 6[(1) If the assessing authority is satisfied that a dealer , with a view to evade the payment of tax, as shown in his account sales or purchases of any goods at a price which is less than fair market price of such goods, it may, at any time within a period of three years from the date on which any order of assessment was served on the dealer , assess or reassess the dealer to the best of judgement on the turnover of such sales or purchases after making such enquiry as may be necessary and after giving the dealer a reasonable opportunity to show cause against such assessment. 7[ (1-A)while making the assessments under sub-section(1) above, the assessing authority shall adopt the highest value of the goods disclosed by the dealer to various statutory bodies or departments etc.] (2) The provisions of Section 14 including penalty shall apply to assessment and re-assessment of escaped turnover under this section. Note: Sections 14-A and 14-B were inserted by Act 18 of 1985 w.e.f.1.7.1985. G.O.Ms.No.938 Rev. dt.18.9.1989. 1. The Andhra Pradesh State Wine Dealers Association has represented that some officers of Commercial Taxes Department have issued notices to re-open and revise the assessments for the years 1983-84 and 1984-85 based on the prevailing market prices for the period prior to 1.7.1985 specially mentioning the powers in Section 14-B of the Andhra Pradesh General Sales Tax Act, 1957 which has come into force with effect from 1.7.1985. They have obtained and furnished opinions of Additional Solicitor General and Senior Advocate of Supreme Court Sri Shanti Bhushan and requested the Government to issue instructions to the Commercial Taxes Officials not to reopen or revise the assessments for the period prior to 1.7.1985 i.e., the date from which the new Section 14-B has come into force. 2. The Government have examined the matter in detail. The amended definition of "turnover" in section 2(1)(s)(ii) and Section 14-B have been introduced in the A.P.G.S.T. Act 1957 by the A.P.G.S.T.(Amendment) Act, 1985(Act 18 of 1985) with effect from 1.7.1985.Government are advised that since the amendments are not on a true and fair construction thereof, declaratory and clarificatory in character, can only be effected from 1.7.1985 and cannot be enforced from any date prior thereto, it is also advised that no show cause notice can be issued to reopen assessments completed prior to 1.7.1985 on the basis that the dealers have sold their goods at rates which are abnormally lower than the prevailing market rates or that the amount stated in the bill of sale is not correct.Such a ground can only be taken on the basis of amended definition of turnover. 3. Under the powers vested under sub-section(2) of Section 42 of the Andhra Pradesh General Sales Tax Act, 1957(Act VI of 1957)the Government hereby clarify that the above amendments can only be effected from 1.7.1985 and cannot be enforced from any date prior thereto. Hence the above amendments can be enforced for the assessments arising for the transactions after 1.7.1985. It is also clarified that Section 2(1)(s)(ii) and Section 14-B of the said Act should be read together and that the assessments completed prior to 1st July, 1985 cannot be reopened on the ground that the dealers have sold their goods at rates which are abnormally lower than the prevailing market rates or the amount stated in the bill of sale is not correct. 4. In view of the legal position Stated in paras 2 and 3 above the assessing authorities are requested not to reopen and revise the assessments based on prevailing market prices for the period prior to 1.7.1985 invoking the provisions in Section 14-B of the Andhra Pradesh General Sales Tax Act,1957 on the ground that the dealers have sold their goods at rates which are abnormally lower than the prevailing market rates or the amount stated in the bill of sale is not correct. The A.P.High Court in M/s. Deluxe Wines,Hyderabad Vs. State of A.P. (1990) 10 APSTJ 165 declared that Section 2(1)(s)(ii) and Section 14-B must be read down by not giving effect to the said provision until and unless the legislature prescribes guidelines for exercising the power conferred thereunder and defines the expressions "prevailing market prices" and "abnormally low" occurring in Section 14-B of the Act. 5. By A.P.Ord.No.10 of 1994 the words "assess or reassess the dealer" were subs." assess or re-assess the dealer as per the guidelines prescribed" and the following sub-section (3) was added w.e.f.24.5.94. "(3) Notwithstanding the expiry of any period of limitation specified in the Act,assessment or reassessment,revision under this section for the years 1985-86 to 1993-94 shall be made within four years from the 1st April, 1994." The said Ordinance had become Act No.8 of 2995 but the above provisions were omitted in the Act. 6. By Act No.27 of 1996 sub-section (1) was subs.w.e.f.1.8.1996 and the expression "fair market price" has been defined in Section 2(1)(gg). The said sub-section before subs. read as under:- (1) If the assessing authority is satisfied that a dealer has, with a view to evade the payment of tax. shown in his account sales or purchases of any goods at prices which are abnormally low compared to the prevailing market prices of such goods, it may, at any time within a period of *[three years] from the date on which any order of assessment was served on the dealer,assess or re-assess the dealer to the best of the judgement on the turnover of such sales or purchases after making such enquiry as may be necessary and after giving the dealer a reasonable opportunity to show cause against such assessment. * Subs. for four years by Act No.22 of 1995 w.e.f.1.4.1995. 7. Added by Act No.30 of 2001 w.e.f.1.4.2001. 1[14C. Special provision to pay tax on total turnover : (1) Subject to the conditions specified in sub-sections (2) to (5) of this section any dealer other than a casual trader or an agent of a non-resident dealer or a dealer who is registered under Section 7 of the Central Sales Tax Act, 1956 whose total turnover does not exceed rupees five lakhs for the assessment year concerned, may at his option, pay the amount of tax at the rate of two per cent of the total turnover, in lieu of tax payable under the other provisions of this Act. |
| See Rule 15-C Form A9 ,D2 ,D3 ,B7 |
| (2) The provisions of this section shall not apply to dealers dealing in such commodities as may be notified by the Government from time to time. (3) No dealer shall be eligible to opt to pay tax under sub-section (1) for 2[two years] from the date of registration under this Act. (4) If in any one of the preceding [two years], the total turnover of a dealer exceeds rupees five lakhs, he shall not be eligible to opt to pay tax under sub-section (1). (5) Any dealer who is in arrears in the payment of tax to the Government and any dealer against whom proceedings are pending or action was taken under Section 14(4) of the Act, in any of the preceding two years shall not be entitled to opt to pay tax under sub-section (1). (6) The assessment of tax under sub-section (1) shall be deemed to have been completed when the dealer files his return in such manner and with such particulars and proof as may be prescribed. (7) If the return filed by a dealer under sub-section (1) appears to be incorrect or incomplete or the dealer has not paid in full the tax payable under sub-section (1), the authority prescribed shall cancel the option exercised and also the assessment that was deemed to have been completed under sub-section (6) and proceed to assess the total turnover under Section 14 of the Act. 1. Section 14C was inserted by Act No.22 of 1995 w.e.f.1.4.1995. 2. Subs. by Act 27 of 1996 for the words "three years". 1[14-D. Self Assessment : (1) Every dealer (other than a causal trader or a dealer who opted for payment of tax under Section 14C or agent of a non-resident dealer) 3(whose total turnover in a year exceeds ten lakhs but does not exceed rupees twenty five lakhs) in addition to the returns to be filed under Section 13 shall 2[submit to the assessing authority concerned, a return of his total and net turnovers and tax due thereon, at all places of his business in the preceding year within such time] in such form and in such manner, as may be prescribed along with the tax due. |
| See Rule:15-A Form A10 |
| 2. Subs. by Act No.27 of 1996 w.e.f.1.8.1996 for the words "within thirty days of the close
of the year, submit to the assessing authority concerned a return of his total and net
turnovers and tax due thereon, at all places of his business in the preceding year." 3. Subs. by Act No.8 of 1997 w.e.f.4.1.1997 for the words "whose total turnover in a year does not exceed rupees twenty five lakhs". (2) Every such dealer liable to submit a return of self assessment under sub-section (1) shall assess the correct amount of tax due on the turnover liable to tax: Provided that no dealer shall be eligible to assess the tax under this section due for 2[two years] from the date of Registration under this Act. 2. Subs. for the words 'three years' by Act No. 27 of 1996 w.e.f.1.8.1996. (3) Among the cases where the return is filed under sub-section (1) the assessing authority shall take up assessment under Section 14 in respect of the following cases, namely :- (i) Where the return filed by the dealer under sub-section (1) does not appear to be correct and complete; or the dealer has not paid the tax due under sub-section (1) in full; or (ii) where the increase in net taxable turnover during assessment year is 2[less than such percentage as may be prescribed when compared to that of preceding year;] or 2. Bracketed words were subs. by Act NO. 27 OF 1996 W.E.F.1.8.1996 for the words "less than twenty five percent over such turnover of the preceding year". (iii) where in any one of the preceding 2(two years) the total turnover of a dealer exceeds rupees twenty five lakhs; or (iv) where a dealer is in arrears of tax to the Government; or (v) where on inspection of the business premises of a dealer or otherwise there is reason to believe that the dealer has suppressed a part or whole of the turnover of his business or that the dealer is evading payment of tax; or (vi) where in any one of the preceding 2(two years) any proceedings are pending or action was taken under Section 14(4) or Section 14(8) of the Act; or (vii) where the dealer fails to furnish the details of usage of statutory forms like Way Bills, C-Forms, F-Forms, H-Forms and G Forms during the relevant year. 2.Bracketed words subs.by Act NO.27 OF 1996 W.E.F.1.8.1996 for the words "three years". (4) It shall be competent for the assessing authority to take up the returns filed by such number of dealers for assessment under Section 14 as it may deem necessary for detailed scrutiny and verification. (5) In all the cases where a return filed under sub-section (1) is not taken up for assessment either under sub-section (3) or sub-section(4), the return so filed shall be deemed to have been accepted and orders shall be passed in the manner prescribed. (6) The provisions of sub-section (4) of Section 14 shall mutadis mutandis apply to the assessment under this section.] 2. Section 14D was inserted by Act No.22 of 1995 w.e.f.1.4.95. 1[14E. Self Assessment of dealers with a turnover less than rupees ten lakhs: 2(1) Any dealer (whose turnover in a year does not exceed rupees ten lakhs or a dealer registered under sub-Section(1A) of Section 12) 6(whose turnover in a year does not exceed rupees ten lakhs) and liable to file a return under Section 15, shall submit to the assessing authority, within sixty days from the close of the year, a return of self assessment in such form and in such manner as may be prescribed and in such return he shall assess the turnover at all places of his business during the year and tax due thereon correctly; Provided that any return filed after the expiry of sixty days from the close of the year may be received if the return is accompanied by a treasury receipt or cheque or demand draft for payment of a penalty equivalent to the amount calculated at the rate of rupees one hundred for every day of delay; 3 (2) The Commissioner of Commercial Taxes shall issue guidelines from time to time, for identifying from among the dealers who filed returns 4(under sub-section(1)], the dealers whose assessment shall be taken up for assessment under Section 14. 3(3) From among the dealers who filed returns 4[under sub-section(1)], the Deputy Commissioner shall on the basis of the guidelines issued by the Commissioner of Commercial Taxes from time to time, identify within such time as may be prescribed, the dealers whose assessment shall be taken up under Section 14. 3(4) Except in the cases which are identified by the Deputy Commissioner under sub-section(4) for taking up assessment under Section 14 and subject to the conditions that may be prescribed, the assessments of the dealers who file a correct and complete return 4[under sub-section (1)] shall be deemed to have been completed on such date as may be prescribed. 3(5) The provisions of sub-sections (4) and (8) of Section 14 shall apply mutatis mutandis to the assessment deemed to have been completed under sub-section (5) of this section. |
| Form AA9 Rule 15D(1) |
| 1. Section 14E was Ins. by Act No.8 of 1997 w.e.f.4.1.1997 published in A.P. Gazette
Part IV B ExtraOrdinary No. 15 dt.1.4.1997. 2. Sub-section (1) was subs. by Act No.2 of 1998 published in A.P. Gazette Part IV B Extra-Ordinary No.2.dt.3.1.1998. The earlier sub-section (1) read as under: "(1) Any dealer whose turnover in a year does not exceed rupees ten lakhs may,subject to the conditions mentioned in this section and rules made thereunder, opt for self assessment." 3. Sub-section (2) was omitted and sub-sections (3),(4),(5) and (6) were renumbered by Act No.2 of 1998. The earlier sub-section (2) as under: "(2) Any dealer whose turnover in year does not exceed rupees ten lakhs and who intends to opt for self assessment may, in lieu of the return to be filled after the expiry of forty-five days and before seventy five days from the close of the year, a return of self assessment in such form and in such manner as may be prescribed and in such return he shall assess the turnover at all places of his business during the year and tax due thereon correctly:Provided that any return filed after the expiry of forty-five days and before seventy five days from the close of the year may be received if the return is accompanied by a treasury receipt or cheque or demand draft for payment of a penalty equivalent to the amount calculated at the rate of rupees one hundred for every day of delay." 4. Substituted for the words "under sub-section (2) " by Act No.2 of 1998. 5. Sub-section (7) was omitted by Act No.2 of 1998 which read as under: "(7) Any dealer who files a return under sub-section (2) shall pay the tax due for the current Year within such time, and in such manner as may be prescribed." 6. The bracketed words in sub-section (1) were subs. by Act No.19 of 2000 w.e.f.1.4.2000 |