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Santoshi Tel Utpadak Kendra Vs. the Deputy Commissioner - Court Judgment

LegalCrystal Citation
Overruled BySantoshi Tel Utpadak Kendra Vs. Deputy Commissioner of Sales Tax and another Dated:24.07.1981
SubjectSales Tax
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application No. 238 of 1978
Judge
Reported in[1979]43STC307(Bom)
ActsBombay Sales Tax Act, 1959 - Sections 20(5), 20(6), 21, 23(3), 33, 33B, 33B(1), 39, 55, 55(1), 55(1), 55(1), 55(2), 56, 57, 57(1), 57(1), 57(2), 60, 61, 61(1) and 66
AppellantSantoshi Tel Utpadak Kendra
RespondentThe Deputy Commissioner
Advocates:V.R. Manohar, Adv.
Excerpt:
sales tax - revision - sections 55 and 57 (1) (a) of bombay sales tax act, 1959 - whether commissioner of sales tax can exercise his power of revision under section 57 (1) (a) in respect of order passed by assistant commissioner in appeal against which second appeal preferred by assessee pending before tribunal - section 57 bestowed power of revision on commissioner as well as on tribunal - commissioner can exercise power only in respect of order passed by officer or person subordinate to him - he cannot resort to this power after expiry of 3 years from date of communication of order sought to be revised - also no order in revision should be made by him after expiry of 5 years from date of communication of order sought to be revised - commissioner can exercise power of revision not only.....ginwala, j.1. the only question that falls for consideration in this petition is whether the commissioner of sales tax can exercise his power of revision under section 57(1)(a) of the bombay sales tax act, 1959, in respect of an order passed by the assistant commissioner in appeal against which a second appeal preferred by the assessee is pending before the maharashtra sales tax tribunal. the facts leading to the present petition briefly stated are as follows : the petitioner was at the relevant time a partnership firm and was registered as such. it appears that it was constituted on 12th june, 1970, and consisted of three partners, namely, kundanlal, bhikarilal and harinarayan, who are sons of bhaiyalal, since deceased. this firm was carrying on the business of manufacturing and selling.....
Judgment:
Ginwala, J.

1. The only question that falls for consideration in this petition is whether the Commissioner of Sales Tax can exercise his power of revision under section 57(1)(a) of the Bombay Sales Tax Act, 1959, in respect of an order passed by the Assistant Commissioner in appeal against which a second appeal preferred by the assessee is pending before the Maharashtra Sales Tax Tribunal.

The facts leading to the present petition briefly stated are as follows :

The petitioner was at the relevant time a partnership firm and was registered as such. It appears that it was constituted on 12th June, 1970, and consisted of three partners, namely, Kundanlal, Bhikarilal and Harinarayan, who are sons of Bhaiyalal, since deceased. This firm was carrying on the business of manufacturing and selling vegetable oil. It is alleged that the business of this firm being managed by Bhaiyalal during his life-time. Bhaiyalal expired on 15th May, 1972. It appears that the books of account of the petitioner-firm were not properly maintained for the period from 1st January, 1971, to 30th June, 1972. In any case, Kundanlal and Bhikarilal, who were major partners of the firm, since at that time Harinarayan was minor, maintained that the accounts were being kept by Bhaiyalal and they were not concerned with the accounts and did not known anything about them. It further appears that on 16th June, 1972, Mr. Girase, Sales Tax Officer at Nagpur, paid a surprise visit to the place of business of the petitioner-firm and seized several account books alone with some documents. It also appears that the residence of the partners of the firm was also searched and some incriminating documents were recovered during that search. Now it seems that the returns form the period from 1st January, 1971, to 31st December, 1971 (hereinafter referred to as the first period), had been filed earlier on behalf of the petitioner-firm. The Sales Tax Officer took up proceedings under sub-section (3) of section 33 of the Bombay Sales Tax Act, 1959, (hereinafter referred to as 'the Act'). With regard to the return for the first period, he compared the entries in the books of account on the basis of which the returns of the period had been filed with the entries in the books which had been seized during the raids at the business premises of the firm as well as at the residence of the partners. The Sales Tax Officer, on comparison of these two sets of account books, found that there were several discrepancies inasmuch as several transactions which had been entered in the second set of books of account did not find place in the books of account which were produced by the firm during the assessment proceedings. On this basis the Sales Tax Officer issued a show cause notice stating the requisite details and asked for an explanation to which the petitioner-firm submitted its explanation. After considering the explanation which was thus submitted by the firm, the Sales Tax Officer was of the view that there was suppression of sales and purchases on the part of the firm and the return which had been filed did not truly and correctly reflect the transactions and the turnover of the petitioner-firm. In the view which he took, the Sales Tax Officer proceeded to make an estimation of the turnover of the sales and purchases for the first period and for this purpose he took into account the consumption of electrical energy by the firm during the said period for the purposes of running its mill. The Sales Tax Officer also took into account the stock as disclosed in some of the books of account which he had seized during the raid and considering all these factors, the Sales Tax Officer determined the extent of the alleged suppression of turnover of sales and purchases indulged in by the petitioner-firm. It appears that for the first period the Sales Tax Officer, by his order dated 26th March, 1973, levied a tax of Rs. 73,198.62, together with total penalty of Rs. 36,197.64.

2. It further appears that so far as the period from 1st January, 1972, to 30th June, 1972 (hereinafter referred to as the second period) was concerned, the petitioner-firm had failed to file any return either monthly or quarterly. The Sales Tax Officer appears to have gone into and scrutinised the two sets of account books referred to earlier and on the same factors and considerations on which he determined the extent of the alleged suppression of turnover of sales and purchases, with respect to the first period, the Sales Tax Officer also worked out the extent of the suppression of the turnover for the second period also and proceeded to levy tax and penalty in regard to that period. He levied tax of Rs. 81,745.71 together with total penalty of Rs. 37,572.26 with regard to the second period under his order dated 26th March, 1973. Apparently, these orders were passed by the Sales Tax Officer in pursuance of his powers under section 33 of the Act.

3. Being aggrieved by the assessment of tax and the levy of penalty by the Sales Tax Officer, under his abovesaid orders, the petitioner-firm preferred two appeals for the abovesaid two periods before the concerned Assistant Commissioner, by virtue of section 55(1)(a) of the Act. The Assistant Commissioner, while deciding the two appeals, was of the view that the Sales Tax Officer had fallen into error in estimating the turnover of sales and purchases on the basis of the consumption of electricity, inasmuch as the Sales Tax Officer did not take into consideration the fact that the mill of the petitioner-firm had not been working continuously throughout the period of assessment but only during a part of it. The Assistant Commissioner was of the view that the Sales Tax Officer had not taken into consideration the contention of the petitioner-firm that out of the several purchases effected by it, a bulk of them was from outside the State of Maharashtra. For this and other reasons, the Assistant Commissioner reduced the quantum of the turnover of the sales and purchases as estimated by the Sales Tax Officer to a much smaller figure for both the abovesaid periods and, consequently, reduced the tax for the first period to Rs. 30,494.67 and the penalty to Rs. 11,745.71 and the tax for the second period to Rs. 16,447.33 and the penalty to Rs. 5,572.26. It would thus appear at once that the Assistant Commissioner effected substantial reduction in the amounts of tax and penalty under his appellate order passed on 29th September, 1973.

4. Not being satisfied by the order passed by the Assistant Commissioner in the two appeals, the petitioner-firm preferred two second appeals being Second Appeals Nos. 2015 and 2016 of 1973 before the Maharashtra Sales Tax Tribunal (hereinafter referred to as 'the Tribunal') on 8th December, 1973. The grievance made by the petitioner-firm in these two appeals was that the Assistant Commissioner had wrongly estimated the extent of sales of oil as also purchases made from unregistered dealers. Probably the contention was that in these matters the Assistant Commissioner had estimated these turnovers in excess of the real sales and purchases. With regard to the penalty also a similar contention was raised by the petitioner before the Tribunal. It appears that on 4th March, 1974, a Bench of the Tribunal condoned the delay in filing these two appeals and directed them to be fixed for hearing on merits in due course.

5. Now when the appeals were thus pending before the Tribunal, the Deputy Commissioner of Nagpur issued two notices to the petitioner-firm on 24th April, 1974, calling upon the petitioner-firm to show cause why the orders passed by the Assistant Commissioner in the two appeals on 29th September, 1973, should not be set aside and appropriate order should not be passed under section 57 of the Act. These two notices related to the first and the second periods respectively and they contained the gist of reasons for which the Deputy Commissioner intended to hold that the orders passed by the Assistant Commissioner in appeal were not proper. By these notices the petitioner-firm was called upon to appear before the Deputy Commissioner on 10th May, 1974, to show cause. Obviously, these two notices were issued by the Deputy Commissioner in exercise of his power of revision conferred on him under section 57 read with section 20(6) of the Act. In reply to these two notice, the petitioner-firm took a preliminary objection to the Deputy Commissioner exercising his power of revision during the pendency of the appeals before the Tribunal. The Deputy Commissioner by his order dated 12th September, 1972, rejected the preliminary objection raised by the petitioner-firm in respect of the said two notices. It may be mentioned here that the Deputy Commissioner while passing this order, considered at length the various submissions which had been urged on behalf of the petitioner-firm. The Deputy Commissioner, while rejecting the preliminary objection, relied mainly on the decision of the Tribunal in the case of Motor and Machinery ., in which the Tribunal had held that the Deputy Commissioner of Sales Tax could revise an order against which an appeal is pending before the Tribunal. Against this order of the Deputy Commissioner, the petitioner-firm preferred two separate appeals before the Tribunal, being Appeals Nos. 61 and 62 of 1975. Since both these appeals were preferred against a common order and the question involved in both of them was the same, the Tribunal heard both these appeals together. Elaborate arguments were advanced by both the parties to the appeal, viz., the petitioner-firm and the department, on the question whether the power of revision under section 57 of the Act could be exercised by the authorities concerned in respect of an order against which an appeal had already been preferred before the Tribunal and was pending. The contentions urged on behalf of the petitioner before the Tribunal were that the exercise of the power of revision during the pendency of the second appeal would nullify its effect, that the power of revision could be exercised only with respect of a final and since the order was subject matter of the appeal before the Tribunal, it was not final and was not capable of being revised and that the right of appeal, which had been conferred on the assessee under section 55 of the Act, cannot be taken away by initiating proceedings for revision under section 57 of the Act. In reply to these contentions, the revenue relied on the decision of a Division Bench of this Court in Commissioner of Sales Tax v. Motor & Machinery . [1976] 38 S.T.C. 78., in which it has been held that the Commissioner is competent to exercise his power of revision under section 57 of the Act even during the pendency of an appeal before the Tribunal in respect of the order which is sought to be revised. The Tribunal found itself bound by the view taken by the Division Bench of this Court in the abovesaid case [1976] 38 S.T.C. 78., which, according to it, concluded the question which had been raised before it for its consideration. In the view which it took, the Tribunal by its judgment dated 27th October, 1977, rejected the submissions which had been urged on behalf of the petitioners before it and dismissed the appeals without recording its own finding on those contentions in deference to the view taken by this Court in the abovesaid case [1976] 38 S.T.C. 78.. Again by another speaking order passed on the same day, i.e., on 27th October, 1977, the Tribunal adjourned the two second appeals, viz., Second Appeals Nos. 2015 and 2016 of 1973, which had been preferred by the petitioner-firm against the appellate orders passed by the Assistant Commissioner. In adjourning these appeals under this order, the Tribunal was of the view that it would not be proper to decide the said second appeals at that stage and thereby defeat the 'right of revision' conferred by the statute on the Commissioner. In short, therefore, the Tribunal though it fit to keep these second appeals pending till the Deputy Commissioner would dispose of the revisional proceedings before him.

6. The present petition has been filed under articles 226 and 227 of the Constitution against the order passed by the Deputy Commissioner on 12th September, 1975, rejecting the preliminary objection raised by the petitioner-firm and also against the order passed by the Tribunal on 27th October, 1977, dismissing the two appeals preferred by the firm against the said order of the Assistant Commissioner. The petition is also directed against the notices issued by the Deputy Commissioner in exercise of his power of revision of 24th April, 1974, and the petitioner prays for quashing all these orders as illegal, invalid and lacking in jurisdiction.

7. The main contention of the petitioner in this petition is that the Tribunal ought not to have relied on the decision of this Court in Commissioner of Sales Tax v. Motor & Machinery . [1976] 38 S.T.C. 78. inasmuch as it was not applicable to the facts of the appeals in question and that at any rate in view of the various submissions which had been urged on behalf of the petitioner before the Tribunal, 'the said decision does not correctly represent the law and necessitates the reconsideration at the hands of this honourable Court as the question came to be decided without consideration of the relevant provisions of law directly impeaching on the subject and further without considering the various other aspects presently raised by the petitioner-assessee to demonstrate that the construction placed by the Tribunal on the provisions of section 57 of the Act is apparently erroneous'.

8. At the outset we may state that though in the prayer clause of the petition the petitioner has asked for quashing of the notices issued by the Deputy Commissioner on 24th April, 1974, no arguments were advanced before us on the merits or demerits of these notices. The submissions on behalf of the petitioner before us were entirely confined to the question which we have set out in the opening part of this judgment. We would, therefore, limit out attention only to this question without going into the legality or propriety on the part of the Deputy Commissioner to issue the two notices dated 24th April, 1974.

9. Mr. Manohar, the learned counsel for the petitioner, strenuously submitted that the view taken by the Division Bench of this Court in Commissioner of Sales Tax v. Motor & Machinery . [1976] 38 S.T.C. 78. (hereinafter referred to as the Motor and Machinery Manufacturers' case) on the point in issue in this petition requires reconsideration at the hands of a larger Bench inasmuch as the Division Bench, which decided the case, had not considered all the relevant aspects of the question. Indeed, at one stage of the arguments, Mr. Manohar suggested that the judgment in the abovesaid case could be said to be per incurium. Again, relying on the observations of the Full Bench of this Court in Parappa v. Mallappa : AIR1956Bom332 ), he also submitted that the said decision [1976] 38 S.T.C. 78. of the Division Bench could not be said to be binding as it has been given without pros and cons of the question being considered. However, Mr. Manohar made it clear that he would not request us to ignore the said decision [1976] 38 S.T.C. 78. of the Division Bench on these two counts and to proceed to decide the question ourselves on the basis of the submissions made by him. He submitted that he would only request us to refer the matter to a larger Bench for reconsideration of the view taken by the Division Bench in the abovesaid case.

10. Before we go to the main controversy in this petition, we may dispose of the two objections which have been raised by Mr. Mor on behalf of the respondents with regard to the maintainability of this petition. These two objections are stated in paragraphs 2 and 3 of the submissions which have been made in writing on behalf of the respondents. It is firstly contended that under section 61 of the Act, it is open to an assessee who is aggrieved by the order passed by the Tribunal to require the latter to refer to the High Court any question of law arising out of the order passed by it and where the Tribunal agrees with the assessee, it has to refer the matter to the High Court. It is urged that the issue involved in the present petition is purely a question of law and if the petitioner was not satisfied with the view which had been taken by the Tribunal with regard to the competency of the Commissioner to exercise his power of revision pending appeals, it could have very well moved the Tribunal under section 61 of the Act to make a reference to this Court and, in all probability, the Tribunal would have referred the matter since it involved a question of law. In other words, it is being submitted that an alternate remedy was available to the petitioner to get its grievance redressed by resorting to sub-section (1) of section 61 of the Act and asking for a reference and, if that was so, a petition under article 226 of the Constitution would not be tenable because of clause (3) of that article. It is also submitted that article 227 of the Constitution, as it stands presently, does not contemplate a petition of the present nature. In short, therefore, it is contended on behalf of the respondents that in view of clause (3) of article 226 of the Constitution, the present petition is not tenable and is liable to be dismissed on this ground alone. In our view, this submission on the part of the respondents cannot hold water, if the provisions of sub-section (1) of section 61 of the Act are closely scrutinised. A plain reading of this sub-section would indicate that it operates on an order which affects the liability of any person to pay tax or penalty, or to forfeiture of any sum or an order which affects the recovery from any person of any amount under section 39. In other words, if a person is not satisfied with an order of the nature indicated above, he can require the Tribunal to refer the question of law involved in it to the High Court. Obviously, the condition precedent for the Tribunal to exercise its power under sub-section (1) of section 61 is that the order in respect of which such a reference is sought to be made should be one which falls in one of the categories of the orders referred to in that sub-section. In the present case, we are dealing with an order passed by the Tribunal under which it rejected the appeals which had been preferred by the petitioner against the order of the Deputy Commissioner who in turn had rejected the preliminary objection raised by the petitioner with regard to the tenability of the revisional proceedings before him and his competency to entertain such proceedings in the face of second appeals pending before the Tribunal. It is needless to say that the order which was passed by the Deputy Commissioner rejecting the preliminary objection and also the order passed by the Tribunal in the appeal cannot be said to be an order which affects the liability of the petitioner to pay tax or penalty or to forfeiture of any sum or which affects the recovery of any amount from it under section 39 of the Act. In other words, the order which the Tribunal was dealing with in appeal and the order which it passed itself was not of the nature contemplated by sub-section (1) of section 61 of the Act. Hence the question of the petitioner calling upon the Tribunal to make a reference to the High Court on the question of law involved in the appeal before it would not arise. In short, therefore, this was not a case which would be covered by sub-section (1) of section 61 of the act and it was not open to the petitioner to resort to the said provision for seeking a reference to the High Court.

11. Mr. Mor submitted that the order passed by the Tribunal in appeal confirms the power of revision of the Deputy Commissioner and hence it affects the petitioner's liability to pay the tax and penalty and, in that sense, it is an order which falls within the category of the orders contemplated by sub-section (1) of section 61 of the Act. It is not possible to accept this sub-mission of Mr. Mor for the simple reason that the order which is contemplated by the said sub-section is the one which has the effect of directly affecting the liability to pay the tax or penalty or to forfeiture or affecting certain recovery. In our view, this sub-section would not come into play if the order passed by the Tribunal is one which has an indirect effect or remote effect on the liability of the assessee to pay the tax. In our opinion, therefore, there is no substance in this objection raised on behalf of the respondents.

12. The next objection is that the petitioner has evaded payment of tax on large part of the turnover of the sales and purchases effected by it and hence this Court should not exercise its extraordinary powers under article 226 of the Constitution in favour of such a petitioner who has not come before this Court with clean hands. Now assuming this is possible, the very fact whether the petitioner has evaded payment of tax on a large scale is in dispute and is subject-matter of decision before the Tribunal in the two second appeals, which it has filed against the appellate orders passed by the Assistant Commissioner and also before the Deputy Commissioner when he is trying to exercise his power of revision with regard to the said orders of the Assistant Commissioner. It is not, therefore, possible at this stage to say that this Court should not exercise its extraordinary jurisdiction in favour of the petitioner simply for the reason that its hands are soiled. We, therefore, see no substance in this objection either.

13. The whole controversy in this petition centres round the interpretation of section 55 and 57 of the Act. It will, therefore, be convenient to reproduce them and bear in mind the various provisions contained in them before we proceed to consider the merits of the rival contentions urged before us. These two sections are in the following terms :

'55. (1) An appeal, from every original order, not being an order mentioned in section 56 passed under this Act or the Rules made thereunder, shall lie -

(a)if the order is made by a Sales Tax Officer, or any other officer subordinate thereto, to the Assistant Commissioner;

(b) if the order is made by an Assistant Commissioner, to the Commissioner;

(c) if the order is made by a Deputy Commissioner, Additional Commissioner, or Commissioner, to the Tribunal.

(2) In the case of an order passed in appeal by an Assistant Commissioner, a second appeal shall lie, at the option of the appellate, either to the Commissioner or to the Tribunal.

(3) Every order passed in appeal under this section, shall subject to the provisions of section 57, 61 and 62, be final.

(4) Subject to the provisions of section 60, on appeal shall be entertained unless it is filed within sixty days from the date of the communication of the order appealed against.

(5) No appeal, against an order of assessment with or without penalty, or against an order imposing a penalty, or against an order directing the forfeiture of any tax collected by a dealer, shall ordinarily be entertained by an appellate authority, unless such appeal is accompanied by satisfactory proof of the payment of the tax with or without penalty, or, as the case may be, of the payment of the penalty, or the amount forfeited, in respect of which the appeal has been preferred :

Provided that, an appellate authority may if it thinks fit, for reasons to be recorded in writing, entertain an appeal against such order -

(a) without payment of the tax with penalty (if any), or as the case may be, of the penalty or of the sum forfeited on the appellant furnishing in the prescribed manner security for such amount as it may direct, or

(b) on proof of payment of such smaller sum, with or without security for such amount of tax, penalty or sum forfeited which remains unpaid, as it may direct.

(6) Subject to such rules of procedure as may be prescribed, every appellate authority (both in the first appeal and the second appeal) shall have the following powers :-

(a) in an appeal against an order of assessment, it may confirm, reduce, enhance or annual the assessment; or it may set aside the assessment and refer the case back to the assessing authority for making a fresh assessment in accordance with the direction given by it and after making such further inquiry as may be necessary; and the assessing authority shall thereupon proceed to make such fresh assessment and determine, where necessary, the amount of tax payable on the basis of such fresh assessment;

(b) in an appeal against an order imposing or penalty, the appellate authority may confirm or cancel such order or very it so as either to enhance or to reduce the penalty;

(c) in any other case, the appellate authority mass pass such orders in the appeal as it deems just and proper :

Provided that, the appellate authority shall not enhance an assessment or a penalty or reduce the amount of drawback, set-off or refund of the tax, unless the appellant has had a reasonable opportunity of showing cause against such enhancement or reduction.'

'57. (1) Subject to the provisions of section 56 and to any rules which may be made in this behalf, -

(a) the Commissioner may, of his own motion, call for and examine the record of any order passed (including an order passed in appeal) under this Act or the Rules made thereunder by any officer or person subordinate to him and pass such order thereon as he thinks just and proper :

Provided that, no notice in the prescribed form shall be served by the Commissioner under this clause after the expiry of three years from the date of the communication of the order sought to be revised, and no order in revision shall be made by him hereunder after the expiry of five years from such date; (b) the Tribunal, on application made to it against an order of the Commissioner (not being an order passed under sub-section (2) of section 55 in second appeal) within four months from the date of the communication of the order, may call for and examine the record of any such order, and pass such order thereon as it thinks just and proper.

(2) Where an appeal lies under section 55 and no appeal has been filed, no proceedings in revision under this section shall be entertained upon application.

(3) No order shall be passed under this section which adversely affects any person, unless such person has been given reasonable opportunity of being heard.

(4) If the Tribunal rejects any application for revision under this section, the Tribunal shall record the reasons for such rejection.'

14. The scheme of section 55, as would be clear from the plain reading of it, is that first appeals are provided from original orders passed by a Sales Tax Officer, an officer subordinate to him, an Assistant Commissioner, a Deputy Commissioner, Additional Commissioner or the Commissioner. If the original order is passed by a Sales Tax Officer or any officer subordinate to him, then the first appeal lies to the Assistant Commissioner. If the original order is passed by an Assistant Commissioner, the appeal would lie to the Commissioner, but if the original order is passed by a Deputy Commissioner, Additional Commissioner or Commissioner, the appeal would lie to the Tribunal. It would thus appear that a first appeal would lie to the Tribunal only from an original order passed by a Deputy Commissioner, Additional Commissioner or the Commissioner. However, when an Assistant Commissioner passes an order in appeal, a second appeal has been provided for an option has been given to the appellant to choose the forum of the second appeal. He could either present the appeal to the Commissioner or to the Tribunal as he wishes. Now there are two limitations which have been engrafted on the right of appeal. First is with regard to the limitation and it is provided that an appeal has to be preferred within 60 days from the date of communication of the order appealed against. Another limitation is that if the appeal is against an order of assessment, with or without penalty, or against an order imposing penalty or against an order directing forfeiture of any tax collected, the appellate authority would not ordinarily entertain an appeal unless it is accompanied by satisfactory proof of payment of the tax or the amount concerned, in respect of which the appeal has been preferred. However, at the same time, power has been given to the appellate authority to waive this condition in certain cases. The appellate authority, while dealing with the first appeal or the second appeal, has been given power not only to confirm or reduce the assessment or penalty but also to enhance the same. But while so enhancing the assessment or the penalty, the appellate authority has to give a reasonable opportunity to the appellant to show cause why such enhancement should not be allowed. Now every order passed in appeal has been made final subject to the provisions of section 57, 61 and 62. These are the salient features of the provisions regarding appeals.

15. Coming to section 57, it would appear that the power of revision has been bestowed both on the commissioner as well as on the Tribunal. However, the Commissioner can exercise this power only in respect of an order passed by an officer or person subordinate to him, and can exercise this power of his own motion. This power bestowed on the Commissioner, however, is hemmed by certain conditions and they are that he cannot resort to this power after the expiry of three years from the date of communication of the order which is sought to be revised and that no order in revision should be made by him after the expiry of five years from that date, viz., the date of communication of the order sought to be revised. It would, therefore, appear that these are the two termini with regard to the time within which it would be open to the Commissioner to exercise his power of revision. At this stage it would be pertinent to note that the Commissioner can exercise the power of revision not only with respect to an original order but also with regard to an order passed in appeal. So far as the Tribunal is concerned, it can revise an order of the Commissioner which term presumably would include the officers subordinate to the Commissioner who exercise such powers and perform such duties of the Commissioner as are conferred or imposed on them by or under the Act. However, the Tribunal can exercise this power only on an application made to it and that too within four months from the date of communication of the order sought to be revised. It would, therefore, appear that the Tribunal cannot revise any order suo motu and can exercise this power only on an application from an aggrieved person. Now sub-section (2) of section 57 lays down that if an order is appealable under section 55 and no appeal has been filed, then proceedings in revision would not be entertained upon an application. In other words, this would mean that a person who is aggrieved by an order against which he could have filed an appeal, but does not do so, cannot resort to revisional proceedings by making an application. It would appear from the language of sub-section (2) of section 57 that this limitation would operate only on the power of the Tribunal inasmuch as, we have seen above, it is only the Tribunal which can entertain proceedings in revision on an application. Thus, reading clause (b) of sub-section (1) of section 57 with sub-section (2) thereof, it appears that a person who is aggrieved by an order cannot move the Tribunal in revision if he had a right of appeal but has not exercised the same. In a way, therefore, this is a limitation on the power of revision conferred on the Tribunal. We may here mention that the other limitation which has been put on the said power of the Tribunal is that the person who moves it must do so within four months from the date of communication of the order. When we are on this point, we may also mention here that if the Tribunal rejects any application for revision, it has to record reasons which provision we do not find with regard to the Commissioner. Then it is provided and this provision would apply to the Commissioner as well as the Tribunal, that if an adverse order has to be passed against any person, he must be given reasonable opportunity of being heard. This, of course, is in keeping with the principles of natural justice. Thus a plain reading of section 57 would indicate that the Commissioner and the Tribunal have to exercise their powers of revision with certain limitations which we have stated above and which are clear from the language of the section itself. Now we have to consider the arguments advanced by both the sides before us in the background of these provisions.

16. The question, which falls for consideration in this petition, as set out above, has been answered by the Division Bench of this Court, as stated earlier, in Motor & Machinery Manufacturers' case [1976] 38 S.T.C. 78.. It would, therefore, be pertinent to reproduce the relevant passage from the judgment, which is as follows :

'The next contention urged by Mr. Joshi was that under section 55(2) of the said Act a right was conferred on the assessee to go by way of second appeal against an order passed in appeal by the Assistant Commissioner either to the Commissioner or to the Tribunal and that such a right could not be taken away by the Commissioner exercising the powers of revision under sub-section (1) section 57. We are unable to see any force in this contention. If the Commissioner has been given the power of revision suo motu, we fail to see how, merely because as a result of the exercise of such power the assessee might be deprived of his chance of going by way of second appeal, this can make a difference to the construction of these provisions. Moreover, it is not as if the assessee is helpless against an order passed by the Commissioner in exercise of his powers of suo motu revision under section 57(1) of the said Act. It is common ground before us that, even against such an order, the assessee could go by way of appeal to the Tribunal under the provisions of section 55(1)(c) of the said Act and hence we fail to see how this consideration is at all material in the construction of the provisions before us.

The final contention of Mr. Joshi is that section 57 only postulates the disturbance of a final order and, in the present case, the order passed by the Assistant commissioner was not a final order because there was an appeal preferred by the assessee to the Sales Tax Tribunal against this order which was pending at the time when the Deputy Commissioner issued the notice of suo motu revision. We are unable to accept this contention either. When the appeal was disposed of by the Assistant Commissioner, he had passed a final order disposing of the appeal. Unless that order was in any manner disturbed by the Sales Tax Tribunal, it would continue to remain as the final order, subject to the revisional powers of the Commissioner under section 57(1) of the said Act. Apart from this, a plain reading of the relevant provisions makes it clear that there is nothing in these provisions of exclude from the revisional powers of the Commissioner under section 57(1) of the said Act orders passed by the Assistant Commissioner from which appeal before the Tribunal are pending. This submission of Mr. Joshi must also be rejected.'

17. As already seen, it is contended before us that the view taken by the Division Bench in this case requires reconsideration at the hands of a larger Bench inasmuch as the Division Bench has not taken into account various facets and aspects of the point in issue while arriving at its conclusion. Mr. Manohar has advanced four-fold argument to commend to us the reconsideration of the view taken by the Division Bench. We would deal with these points one by one.

18. It is firstly urged by Mr. Manohar that section 55 of the Act confers a right of appeal on the assessee in respect of orders passed by the sales tax authorities. If the assessee is not satisfied with the order passed by any of the sales tax authorities mentioned in that section, he can, as of right, prefer an appeal or appeals, as the case may be, to the higher officers and the Tribunal. Mr. Manohar submits that this right of appeal is a vested right and it cannot be destroyed or pre-empted without any express provision of law. In other words, he submitted that the right of appeal which has been vested in the assessee can be taken away only by express legislation or by any legislation from which the intention to take away this right clearly follows. Mr. Manohar further submitted that if the assessee prefers an appeal against the order passed by one of the sales tax authorities and if during the pendency of that appeal the Commissioner or for the matter of that the authorities exercising the power of revision under section 57 of the Act, are allowed to exercise such a power on the order under appeal, it would be tantamount to making the appeal infructuous inasmuch as if during the pendency of the appeal the order under appeal is revised, that order would no more subsist and there would be nothing on which the appellate authority could give its decision. It is in this way that Mr. Manohar submits that the exercise of the power of revision by the revisional authorities under section 57 during the pendency of the appeal would take away the right of the assessee to file appeal. Mr. Manohar submitted that though section 57 of the Act does not expressly put any limitations on the power of the revisional authority in a case when an appeal has been preferred against the order which it wants to revise such a limitation will have to be assumed in order to avoid a conflict between the provisions of sections 55 and 57. According to Mr. Manohar, if there is a conflict between two sections or two provisions of a statute, they have to be construed harmoniously so as to give effect to both of them keeping in view the object and intention of the statute and that they should not be construed in a way to destroy the effect of any of them. On the basis of these submission, therefore, Mr. Manohar says that the revisional authority should not be allowed to exercise its powers of revision when an appeal is preferred and is pending in respect of the very order which the revisional authority wants to revise.

19. For the proposition that an appeal is a vested right and that it cannot be taken away without proper legislation, Mr. Manohar has drawn our attention to the decisions of the Supreme Court in Hoosein Kasam v. State of Madhya Pradesh [1953] 4 S.T.C. 114 (S.C.) and Garikapati v. Subbiah Choudhry : [1957]1SCR488 . In Hoosein Kasam's case [1953] 4 S.T.C. 114 (S.C.), the Supreme Court has held that a right of appeal is not merely a matter of procedure but a matter of substantive right and this right becomes vested in a party when proceedings are first initiated in, and before a decision is given by, the inferior court and that such vested right cannot be taken away except by express enactment or necessary intendment. The Supreme Court further observed in this case that the intention to interfere with or to impair or imperil such a vested right cannot be presumed unless such intention be clearly manifested by express words or necessary implication. In the case of Garikapati : [1957]1SCR488 , after taking survey of the decisions bearing on this point including the one in Hoosein Kasam's case [1953] 4 S.T.C. 114 (S.C.)., the Supreme Court laid down the following principles :

'(i) That the legal pursuit of a remedy, suit, appeal and second appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding.

(ii) The right of appeal is not a mere matter of procedure but is a substantive right.

(iii) The institution of the suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit.

(iv) The right of appeal is a vested right and such a right to enter the superior court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law prevailing at the date of institution of the suit or proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal.

(v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise.'

20. It would be pertinent to note that in both these cases before the Supreme Court the question for consideration before it was whether a right of appeal which had been conferred by an earlier statute was taken away by a subsequent statute particularly when the latter statute was not made retroactive. The question before the Supreme Court was whether an existing right of appeal under a previous statute would come to an end because of a contrary provision in a latter statute simply on its enactment, without any express or implied intention on the part of the legislature to indicate that the latter statute was to operate retrospectively. It was in this context that the Supreme Court observed in these cases that the vested right or appeal can be taken away only by a subsequent enactment if it so provides expressly or by necessary intendment and not otherwise. In our view, the principles which have been laid down by the Supreme Court in these two cases would not be of any avail to the petitioner inasmuch as this is not a case where the right of appeal had been provided by an earlier enactment and has been taken away by a subsequent enactment. Here we are considering the provisions simultaneously enacted in the same statute, viz., the Bombay Sales Tax Act, 1959. It is now well-settled that the right of appeal is a creation of statute. It is not a natural right. Hence the legislature which creates the right of appeal by a statute can at the same time put restrictions on it so as to curtail this right. There would be nothing wrong if the legislature does so. It may by one of the provisions of the statute confer a right of appeal on a person and by another provision in the same statute either curtail it or put some limitation on it and, in our view, no fault can be found, when such provision is made in the same statute, as the statute will have to be read as a whole.

21. It is true, as has been laid down by the Supreme Court in K. M. Nanavati v. State of Bombay : 1961CriLJ173 , that if there is any filed where two powers can be exercised simultaneously, the principle of harmonious construction has to be resorted to in order that there may not be any conflict between them. It is also true, as has been laid down by the Supreme Court in D. Sanjeevayya v. Election Tribunal, Andhra Pradesh A.I.R. 1967 S.C. 1211, that the provisions of a statute should be so read as to harmonise with one another and the provision of one section cannot be used to defeat those of another unless it is impossible to effect reconciliation between them. Mr. Manohar relied on these two decisions in support of his contention that there is obvious conflict between the provisions of section 55 and section 57 of the Act and there is also a conflict between the jurisdiction of the appellate and revisional authorities and in order to avoid these conflicts of the provisions of the Act and the jurisdictions, it will be necessary to place such a construction on these two sections as would avoid the conflict and which would be in harmony with the provisions and particularly with the object of the Act. According to him, as we have stated earlier, the exercise of the power of revision under section 57 by the revisional authority would have the effect of destroying the right of appeal conferred by the Act on an assessee under section 55 of the Act. It is not possible to see as to how there would be a conflict of provisions of jurisdiction if these two sections are properly construed in their context. A similar argument had been advanced before the Division Bench in Motor & Machinery . [1974] 34 S.T.C. 113. In this connection, it would be pertinent to reproduce the relevant passage from this judgment :

'It was next contended by Mr. Chagla that if the view which we are taking above were to prevail, then, it would lead to an anomalous position, namely, that under section 57 there would be two authorities which would be having overlapping revisional jurisdiction and leading to a possible conflict of decisions being arrived at by these two authorities. He pointed out that though under clause (b) of sub-section (1) of section 57, the Tribunal had been empowered to exercise revisional jurisdiction against an order of the Commissioner [not being an order passed under sub-section (2) of section 55 in second appeal], it was conceivable that if a Deputy Commissioner or an Additional Commissioner were to pass an order against the original order made by an Assistant Commissioner under clause (b) of sub-section (1) of section 55, such an order of a Deputy Commissioner or an Additional Commissioner would be open to the revisional jurisdiction, both of Commissioner acting under clause (a) of sub-section (1) of section 57 as well as of Tribunal under clause (b) of sub-section (1) of section 57 and, therefore, the two authorities having the same revisional jurisdiction are likely to come to a conflicting decision. In our view, the apprehension that such overlapping of jurisdiction of the two authorities would lead to a conflicting decision is rather far-fetched and, in practice, it could be shown as unfounded. If the order passed by the lower authorities, such as Assistant Commissioner, Deputy Commissioner or Additional Commissioner, which is intended to be revised, happens to be in favour of an assessee, then, there is no question of any conflict arising, for ordinarily such an assessee would not think of going to either of the two authorities. If at all, it would be the Commissioner who would suo motu exercise the revisional jurisdiction under clause (a) of sub-section (1) of section 57 after issuing a notice to an assessee, in which case either the order concerned may be confirmed or varied or reversed by the Commissioner exercising his revisional jurisdiction, and there would be no question of the other authority, namely, the Tribunal having anything to do at this stage. If the Commissioner were to decide adversely against any assessee in exercise of his revisional jurisdiction, it would be open to an assessee to carry the Commissioner's order before the Tribunal and call upon the Tribunal to exercise its revisional jurisdiction under clause (b) of sub-section (1) of section 57 over such order. In such a case, it is inconceivable that the Commissioner who has revisional jurisdiction would himself approach the Tribunal for asking the Tribunal to exercise its jurisdiction under clause (b) of sub-section (1) of section 57. On the other hand, if the order in question happens to be against an assessee, then it is open to the assessee to bring the adverse order to the notice of the Commissioner to enable the latter officer to exercise his revisional jurisdiction under clause (a) of sub-section (1) of section 57 or he can directly approach the Tribunal in exercise of his right conferred under clause (b) of sub-section (1) of section 57. It is true that the two authorities would be having revisional jurisdiction. But again it is inconceivable that an assessee who wishes to go in revision against the adverse order would approach both the authorities simultaneously. He would either go to the Commissioner or to the Tribunal in which case also there is least likelihood of any conflicting decision being given by the two authorities concerned. The only possibility of an actual conflict arising to which Mr. Chagla would draw our attention was in a case where the Commissioner can seek to exercise his revisional jurisdiction suo motu when the assessee had already approached the Tribunal in revision or by way of appeal. In such a case, it is quite clear that the provisions of clauses (a) and (b) of sub-section (1) of section 57 will have to be read harmoniously, and it can be presumed that the authorities on whom such revisional jurisdiction has been conferred by the enactment would exercise their revisional jurisdiction harmoniously. In a case where the Commissioner sought to exercise such revisional jurisdiction when the matter was already pending in appeal or revision before the Tribunal, it is inconceivable that the Commissioner would seek to proceed with his revisional power in case of it being brought to his attention by the assessee that the matter was already pending before the Tribunal. Even if he sought to do so, we may point out that any order passed by him would again be subject to the revisional jurisdiction of the Tribunal and, therefore, no real prejudice could be caused to the assessee. In our view, therefore, the anomaly of overlapping jurisdiction leading to a conflicting decision does not present any difficulty in placing the interpretation which we have placed on the provisions of section 20(5) and section 20(6) of the Act.'

22. What has been said in the passage quoted above with regard to the overlapping revisional jurisdiction of the Commissioner and the Tribunal could be said with equal force with regard to the overlapping jurisdiction of the Commissioner in revision and the Tribunal in appeal. In our view, therefore, the passage quoted above is a complete answer to the contingency which has been apprehended by the petitioner. We, therefore, find that the submission of Mr. Manohar that the exercise of power of revision by the Commissioner pending appeal would pre-empt or destroy the right of appeal vested in the assessee is not well-founded.

23. The next contention urged by Mr. Manohar is that the result which the Commissioner intends to achieve by resorting to his revisional power under section 57 of the Act can very well be achieved by involving the power of the appellate authority under sub-section (6) of section 55 of the Act for enhancement of the assessment or the penalty, as the case may be. In other words. Mr. Manohar submits that the revenue has a remedy to get its grievance regarding under-assessment or reduction of penalty redressed by representing the matter properly to the appellate authority. He submitted that under section 55 of the Act, the right of appeal is conferred not only on the assessee but also on the revenue and the revenue could prefer an appeal against an order by which it is aggrieved as much as an assessee could prefer an appeal on such grounds. He, therefore, contended that in this situation it will not be competent for the Commissioner to exercise his revisional jurisdiction. For the proposition which Mr. Manohar has advanced in this connection he relied on the decision of a Division Bench of this Court in Commissioner of Income-tax v. Amritlal Bhogilal : [1953]23ITR420(Bom) . Now since Mr. Manohar relies to a great extent on the ratio of this case, it would be necessary to consider it in some detail.

24. In that case, the Income-tax Officer made assessment in respect of the assessment years 1947-48, 1948-49 and 1949-50 under section 23(3) of the Income-tax Act, 1922. The assessee had applied for renewal of the registration of the firm and the Income-tax Officer passed an order granting renewal under section 26A of that Act. The assessee preferred appeals before the Appellate Assistant Commissioner against the order of assessment with regard to the years 1947-48, 1948-49 and 1949-50. The Appellate Assistant Commissioner decided the two appeals for the years 1947-48 and 1948-49 and gave certain relief to the assessee. However, the Appellate Assistant Commissioner did not decide the appeal in respect of the assessment year 1949-50. In the meanwhile it appeared to the Commissioner of Income-tax that the firm which had been granted renewal of registration was not a firm which could be registered under the Income-tax Act as one of the partners was a minor. He, therefore, took action under section 33B(1) of the said Act and issued a notice to the assessee to show cause why the assessment made under section 23(3) and the registration granted under section 26A should not be cancelled. After hearing the parties, the Commissioner cancelled the orders passed by the Income-tax Officer under sections 23(3) and 26A of the said Act and directed the Income-tax Officer to refuse to renew the registration of the firm for the said three years. The Income-tax Officer was further directed to make fresh assessment for each of the said three years. In view of this direction, the Income-tax Officer passed fresh assessment orders without giving the assessee any notice of hearing. The matter came up before the High Court in a reference under section 66 of the said Act.

It appears that three questions of law were referred to the High Court, first of them being :

'Whether, on the facts and circumstances of the case, the Commissioner of Income-tax acting under section 33B(1) can set aside orders passed by the Appellate Assistant Commissioner for the assessment years 1947-48 and 1948-49 ?'

25. We are not concerned here with the other two questions. The Division Bench answered this question in the negative in view of its earlier decision in Commissioner of Income-tax v. Tejaji Farasram : [1953]23ITR412(Bom) . However, since this question only dealt with the assessment years 1947-48 and 1948-49 and since the Tribunal had also dealt in its judgment with the year 1949-50, but had not raised any question with regard to that year, the Division Bench itself raised the following question :

'Whether the order of the Commissioner acting under section 33B(1) setting aside the order of the Income-tax Officer while an appeal from that order was pending before the Appellate Assistant Commissioner was valid ?'

and answered it in the negative for the following reasons :

'Sir Nusserwanji says that inasmuch as the order of the Income-tax Officer had not become merged in the order of the Appellate Assistant Commissioner under section 33B, the Commissioner had jurisdiction to revise the order of the Income-tax Officer. Sir Nusserwanji says that in this case clearly he was revising the order of the Income-tax Officer and not the order of the Appellate Assistant Commissioner and, therefore, on principle, the position is different from the position we considered in the last reference. Now, in our opinion, when one analyses section 33B a little more closely it is apparent that the legislature never intended to give the power to the Commissioner to revise an order of the Income-tax Officer when the assessee had appealed from that order. As pointed out in the last reference, the object of enacting section 33B was to confer a power upon the Commissioner in the interest of revenue to revise orders of the Income-tax Officer which could not be revised under any circumstances if the assessee did not appeal from those orders. However erroneous the order of the Income-tax Officer may be, however prejudicial to the revenue, the assessee by refusing to exercise his right to appeal could make that order conclusive. In order to fill up this obvious lacuna the legislature enacted section 33B. But once the assessee has appealed, there is no difficulty whatsoever in the way of the department in agitating any question before the Appellate Assistant Commissioner which in its opining should be agitated and decided in the interest of public revenue. Now, it is clear that when an appeal is pending before the Appellate Assistant Commissioner, the Income-tax Officer has the right to be heard either in person or by a representative, and the very point which the Commissioner has taken and on which he has given his decision under section 33B could have been urged under the directions of the Commissioner before the Appellate Assistant Commissioner. It is only when no remedy is open to the Commissioner to revise the order of the Income-tax Officer that this jurisdiction under section 33B arises. But when a legal remedy is given to him to get the orders of the Income-tax Officer revised, he cannot requisition to his aid the power conferred upon him under section 33B. Once the appeal with regard to the year 1949-50 was pending before the Appellate Assistant Commissioner the Commissioner was given the full right to get the order of the Income-tax Officer revised in any manner he thought necessary in the interest of public revenue. He had to satisfy the Appellate Assistant Commissioner that the firm had been wrongly registered and that the registration should be cancelled and if he could not induce the Appellate Assistant Commissioner to take the view he had taken, he had a further right to go to Tribunal. Therefore, instead of getting a decision from the ordinary tribunals set up under the Income-tax Act, viz., the Appellate Assistant Commissioner and the Appellate Tribunal, the Commissioner exercised his revisional powers under section 33B. In our opinion, the revisional powers are exceptional powers to be exercised at exceptional time for exceptional reasons, and the exceptional reason for which the powers can be and should be exercised is when the Commissioner feels that the public revenue is likely to suffer and that no remedy is open to him to get the order of the Income-tax Officer revised. As he had a clear obvious remedy in the appeal which was pending before the Appellate Assistant Commissioner, in our opinion, he had no jurisdiction to exercise his powers under section 33B. In view of this decision it is unnecessary to decide the other questions raised by the Tribunal.'

26. It would appear that the Division Bench upheld the contention on behalf of the assessee on the ground that the Commissioner of Income-tax could not have exercised the power of revision because he had a remedy in appeal which was pending before the Appellate Assistant Commissioner. Now an appeal was preferred against this decision of the High Court by the Commissioner of Income-tax before the Supreme Court (see Commissioner of Income-tax v. Amritlal Bhogilal and Co. : [1958]34ITR130(SC) ).

According to their Lordships, two questions fell to be decided in this appeal and they formulated these questions as follows :

'In the present appeal, two short questions fall to be decided under section 33B(1). Does the order passed by the Income-tax Officer granting registration to the assessee-firm continue to be an order passed by the Income-tax Officer even after the assessee's appeal against the assessment made by the Income-tax Officer on the basis that the assessee was a registered firm has been disposed of by the Appellate Assistant Commissioner In other words, where the appeal preferred by an assessee against his assessment has been considered and decided by the Appellate Assistant Commissioner, does the order or registration along with the subsequent order of assessment merge in the appellate order If, in law, the order of registration can be said to merge in the final appellate order, then clearly the Commissioner's revisional power cannot be exercised in respect of it. This question arises in respect of the registration order in regard to the two assessment years 1947-48 and 1948-49. The other question which also falls to be decided is whether the order of registration in respect of the assessment year 1949-50 can be made the subject-matter of the exercise of the Commissioner's revisional power even though the assessee's appeal against the assessment for the said year is pending before the Appellate Assistant Commissioner at the material time.'

27. With regard to the first question, the Supreme Court held that an order granting registration to a firm was not amendable to the appellate jurisdiction of the Appellate Assistant Commissioner and, this being so, such an order stood outside his jurisdiction and did not strictly form part of the proceedings before him and hence such an order did not merge in the appellate order.

28. With regard to the second question which corresponded to the additional question raised by the High Court, the Supreme Court recorded its finding in the following terms :

'The case in regard to the subsequent year 1949-50 presents no difficulty. The appeal preferred by the respondent against the Income-tax Officer's assessment order in respect of this year was pending at the material time before the Appellate Assistant Commissioner; and so no question of merger arose in respect of the order granting renewal of registration for this period. There can be no doubt even on the theory of merger the pendency of an appeal may put the order under appeal in jeopardy but until the appeal is finally disposed of the said order subsists and is effective in law. It cannot be urged that the mere pendency of an appeal has the effect of suspending the operation of the order under appeal. The High Court, however, appears to have taken the view that the revisional power is an extraordinary power and can be exercised only for unusual and extraordinary reasons. It was also assumed by the High Court that, in the pending appeal, the department would have an alternative remedy because, according to the High Court, the department could have challenged the validity or the propriety of the respondent's registration and could have asked the Appellate Assistant Commissioner to cancel it. As we have already pointed out, the department could not challenge the validity of the registration order in the assessee's appeal before the appellate authority and so the argument that the department had an alternative remedy is not correct. It is clear from the judgment of the High Court that it is the assumption that the department had an alternative remedy which weighed with the learned Judges in reaching their final conclusion. Then the argument that the extraordinary revisional power must be exercised only for extraordinary reasons is really not very materials. Whether or not the revisional power can be exercised in a given case must be determined solely by reference to the terms of section 33B itself. Courts would not be justified in imposing additional limitations on the exercise of the said power on hypothetical considerations of policy or the extraordinary nature of the power. We must, therefore, hold that the High Court was also in error in holding that the Commissioner was not authorised in cancelling the order of the respondent's registration for the year 1949-50. The result is that the view taken by the High Court must be reversed and the first question framed by the Tribunal as well as the additional question framed by the High Court must be answered in favour of the appellant.'

29. It would thus appear that the Supreme Court has reversed the finding of the High Court on the additional question framed by it. Mr. Manohar submitted that even though the Supreme Court had in appeal reversed the judgment of the High Court, the observations which the Division Bench of the High Court had made in the passage quoted above had not been disapproved by the Supreme Court and, therefore, it continued to be goods law in so far as the point covered by it is concerned. It is difficult to uphold this contention of Mr. Manohar in the face of the underlined portion from the passage of the judgment of the Supreme Court extracted above. In our opinion, if the Supreme Court were inclined to approve the said view of the High Court it would not have been pleased to make the abovesaid observations and would have reversed the finding of the High Court on the additional question simply on the ground that the order of the Income-tax Officer granting registration of the firm was not the subject-matter of appeal before the Appellate Assistant Commissioner and hence the question posed by the High Court did not arise. However, it would appear that the observations of the Supreme Court to the effect that the argument that the extraordinary revisional power must be exercised only for extraordinary reasons is not really very material and that courts would not be justified in imposing additional limitations on the exercise of the said power on hypothetical considerations of policy or extraordinary nature of the power conferred with the view that the question whether the said power can be exercised in a given case must be determined solely by reference to the terms of section 33B itself, have clearly been made with reference to the view of the High Court that 'the revisional powers are exceptional powers to be exercised at exceptional time for exceptional reasons, and the exceptional reason for which the powers can be and should be exercised is when the Commissioner feels that the public revenue is likely to suffer and that no remedy is open to him to get the order of the Income-tax Officer revised'. In our view, therefore, it is not possible to say that the Supreme Court has not disapproved the finding of the High Court to the effect that the revisional power cannot be exercised by the Commissioner if alternate remedy is available to him and that this finding of the High Court still holds the filed. In this connection it will be of interest to refer to the judgments of the Assam, Kerala and Calcutta High Courts in Ramlal v. Commissioner of Income-tax, Assam , Kelpunj Enterprises v. Commissioner of Income-tax, Kerala : [1977]108ITR294(Ker) , and Russell Properties Pvt. Ltd. v. A. Chowdhury : [1977]109ITR229(Cal) .

30. As already pointed out above, in this connection one of the contentions of Mr. Manohar was that the Commissioner was able to bring about the result which he wanted to do by way of revision, by preferring an appeal before the Tribunal. He, therefore, submitted that since an alternate remedy was available to the revenue, the Commissioner should not exercise his revisional power under section 57 of the Act. Mr. Manohar drawing our attention to section 55 of the Act, submitted that though that section in express terms does not state that the revenue has a right of appeal against every original order, yet he submitted that the language of the section itself would suggest that such a right of appeal was conferred on the revenue as much as on the assessee. He pointed out that section 55 in terms does not make a distinction between an assessee or the revenue. He submitted that the section was so worded that it would take in its ambit an appeal by the department also. In this connection, he drew our attention to sub-section (6) of section 55, wherein the appellate authority has been given power of enhancing the assessment. Mr. Manohar submitted that this could not be so unless and until the legislature intended that the revenue could also have a right of appeal because, according to Mr. Manohar, if that was not so, there would be no occasion for the appellate authority to exercise the power of enhancement of the assessment or penalty in an appeal filed by the assessee himself. Mr. Manohar further drew our attention to section 246 of the Income-tax Act, 1961, in order to contrast the language of that section with that of section 55 of the Act. Mr. Manohar submitted that sub-section (1) of section 246 of the Income-tax Act specifically provides for an appeal by an assessee and then sub-section (2), no doubt, also provides for an appeal by the revenue, but that was so because in sub-section (1) the right of appeal had been initially given to the assessee. Mr. Manohar contended that had it been the intention of the legislature that the right of appeal under section 55 of the Act should be exercised only by an assessee, then it would have made a provision to that effect as has been done in section 246 of the Income-tax Act. Again Mr. Manohar has drawn our attention to sub-section (1) of section 253 of the Income-tax Act, 1961, to highlight the submissions which he has made in this connection with reference to section 246 of the Income-tax Act as contrasted with the language of section 55 of the Act. Mr. Manohar also drew our attention to regulation 7(3)(a) of the Bombay Sales Tax Tribunal Regulations, 1960, made by the Tribunal in exercise of its power under section 21 of the Act with the previous sanction of the State Government. This regulation requires the State Government to be named as respondent in an appeal filed by the assessee. It also further requires that where the Government is the appellate or applicant, the name and address of the respondent or the opponent, as the case may be, should be specified in the appeal or application, so far as they can be ascertained. Mr. Manohar submitted that a provision to this effect in the Regulations would support his submission that section 55 did contemplate an appeal by the revenue also. In short, therefore, the submission of Mr. Manohar is that, it is possible for the revenue to resort to an appeal to the appellate authorities concerned, if it is aggrieved by an order passed by the subordinate Sales Tax Officers and, if that is so, the Commissioner should not be allowed to resort to revisional proceedings.

31. Mr. Mor submitted that a close scrutiny of section 55 would clearly indicate that it did not contemplate an appeal by the revenue. He laid particular stress on sub-sections (4) and (5) of that section. He submitted that sub-section (4), which provides for a period of limitation for an appeal says that such period would commence from the date of communication of the order appealed against. According to Mr. Mor, there could not be any question of communication of an order to the revenue itself as it is its own officers who would be passing the order which is sought to be appealed against. According to Mr. Mor, the provision in sub-section (4) clearly indicates that the appeal contemplated by section 55 is only by an assessee and not by the revenue. Mr. Mor has also, relying on sub-section (5) of section 55, submitted that the question of depositing the tax or penalty at the time of filing the appeal, as required by this sub-section, would be a condition precedent which would operate in the case of an appeal by an assessee and not by a department. Lastly Mr. Mor also placed reliance on the proviso to sub-section (6) of section 55 and submitted that the word 'appellant' occurring therein clearly indicates that the power of enhancement of assessment or tax conferred on the appellate authority under sub-section (6) of section 55 could be exercised in an appeal filed by the assessee, who would be the appellant within the meaning of the proviso and to whom this proviso gives the right of being heard with regard to the assessment or penalty. Mr. Mor submitted that the proviso, properly construed, would afford an adequate reply to the argument on behalf of the petitioner that the power of enhancement of assessment or penalty bestowed by sub-section (6) of section 55 could be exercised only in an appeal filed by the department. Mr. Mor also drew our attention to the Rules which have been framed by the State Government with regard to the procedure in appeal. He pointed out that the form of appeal memo has been prescribed under the Rules and it is form No. 37 in the Bombay Sales Tax Rules, 1959 (hereinafter referred to as 'the Rules'). Mr. Mor submitted that from the very nature of this form it is apparent that it could be used only by an assessee and not by the revenue. According to Mr. Mor, the very prescription of this form would indicate that no appeal by the department or revenue was contemplated. He also drew out attention to rules 58 to 61, which prescribed the procedure to be adopted in appeals before the sales tax authorities, and he submitted that the perusal of these rules would indicate that they contemplate only appeals by the assessee and not by the revenue and further that the rules do not contemplate even a notice being given to the department or the officer against whose order the appeal is filed. In substance, therefore, according to Mr. Mor, section 55 of the Act does not contemplate and appeal by the department and, as such, there is no alternate remedy to the Commissioner, as submitted by Mr. Manohar.

32. It may here be pointed out that in Motor & Machinery Manufacturers' case [1976] 38 S.T.C. 78., it had been urged by the department before the Division Bench that the power of the Commissioner to revise the order passed by the Assistant Commissioner in appeal must be upheld because there would otherwise be no remedy to the department, if it was aggrieved by an appellate order passed by the latter. The Division Bench did not give any finding on this contention and left the question open by merely observing that it entertained some doubt about the correctness of the view of the Tribunal that even the department could appeal against the adverse decision by the Assistant Commissioner. In our view, it is not necessary to decide the question as to whether it is open to the department to file an appeal under section 55 of the Act against an adverse order. This question would arise if section 57 of the Act were to be construed on the basis that the power thereunder cannot be exercised if an alternative remedy is available to the department. No doubt, as we have observed above, in Amritlal Bhogilal's case : [1953]23ITR420(Bom) , the Division Bench of this Court had observed that the revisional power could not be exercised by the Commissioner because an alternate remedy was available. In other words, that decision of the Division Bench appears to lay down the principle that when legal remedy is given to get the adverse order revised, then the power of revision should not be requisitioned in aid by the Commissioner. However, as we have pointed out above, the Supreme Court has no approved of this view when this matter went in appeal before it. As already seen, the Supreme Court has observed that whether or not the revisional power can be exercised in a given case must be determined solely by reference to the terms of the section conferring that power and the courts would not be justified in imposing additional limitations on the exercise of the said power on hypothetical consideration of policy or extraordinary nature of the power. It would, therefore, appear that the view that when an alternate remedy is available, revisional power could not be exercised, be exercised, is not upheld by the Supreme Court in the abovesaid case. As pointed out by the Supreme Court, the scope and the ambit of the revisional power will have to be determined from the terms of the section, which confers that power. Now, as we have already seen, section 57 of the Act by itself does not provide that the Commissioner would not be in a position to exercise his revisional powers in case where an appeal could be filed by the department. In this connection, we may make a mention of sub-section (2) of section 57 which, as already pointed out, provides that where an appeal lies under section 55 and no appeal has been filed, no proceedings in revision under section 57 shall be entertained upon an application. No doubt, this sub-section does provide that the power of revision cannot be exercised if an appeal has been provided under section 55 and such an appeal has not been filed. However, as we have said above, from the very language of this sub-section it is abundantly clear that it operates on the revisional power of the Tribunal as provided in clause (b) of sub-section (1) of section 57 and not on the power of the Commissioner as conferred on him by clause (a) of sub-section (1) of section 57. In other words, if an appeal is provided under section 55 and no appeal has been filed, then the Tribunal would be debarred from entertaining an application for revision under clause (b) of sub-section (1) of section 57. It would be pertinent to note at this stage that there is no similar provision with regard to the revisional power conferred on the Commissioner under clause (a) of sub-section (1) of section 57, which clearly indicates that the legislature did not intend to curb or limit the revisional powers of the Commissioner in the same way as it did with regard to the revisional power of the Tribunal.

33. If it were that the Commissioner would not be in a position to exercise the revisional powers if the department could appeal with respect to the order which he wants to revise, then it would appear at once that this would render the revisional power of the Commissioner entirely nugatory because whenever an adverse order is passed by the concerned sales sax authorities, there would be an appeal to the superior sales tax authorities or the Tribunal and, in that case, there would be hardly any occasion on which the Commissioner would be called upon to exercise his revisional jurisdiction. Surely when the legislature conferred the power of revision on the Commissioner in the unequivocal terms it did under clause (b) of sub-section (1) of section 57, it could not have intended to put such serious limitations on his power. We, therefore, find that the contention that the Commissioner should not be allowed to exercise his revisional powers simply because it is possible for the department to appeal against the order which he wants to revise is not sound.

34. The next contention of Mr. Manohar is that the right of the assessee to prefer two appeals against an adverse order would be curtailed as in a given case that right would be reduced to a right of one appeal only. In this connection he pointed out that if an order is passed by the Sales Tax Officer, the assessee would have a right to file an appeal not only before the Assistant Commissioner, but also before the Tribunal. But if the Commissioner revises his order before an appeal is filed or decided by the Assistant Commissioner, the assessee could only have a right of appeal before the Tribunal under clause (c) of sub-section (1) of section 55 as the order in revision will be passed by the Deputy Commissioner, the Additional Commissioner or the Commissioner. Mr. Manohar, therefore, submitted that the power of revision could not be allowed to be exercised in a manner which would curtail the right of appeal on the part of the assessee. We have, while dealing with the first contention of Mr. Manohar, pointed out above that the appeal is a creature of statute and the statute, which confers a right, also at the same time can put some limitations on it. Sections 55 and 57 will have to be read together and if the necessary consequence of exercise of power of section 57 is that, in a given case, the assessee is left with only one appeal that must be taken to be the intention of the legislature and must be given effect to, but this obviously cannot be a reason for putting limitation on the power of the Commissioner to revise the order.

35. Lastly Mr. Manohar contended that it is only a final order which can be subjected to revision and when an appeal is filed against an order, it is not final and its finality is suspended. In other words, Mr. Manohar submitted that in this case when an appeal was preferred by the assessee before the Tribunal against the order passed by the Assistant Commissioner, the finality of the order passed by the Assistant Commissioner came to be suspended and hence it was not open to the Commissioner to exercise his power of revision. In this connection we may point out the observations of the Supreme Court in Amritlal Bhogilal's case : [1958]34ITR130(SC) , wherein their Lordships have observed that the pendency of an appeal may put the order under appeal in jeopardy, but until the appeal is finally disposed of, the said order subsists and is effective in law and that it cannot be urged that the mere pendency of an appeal has the effect of suspending the operation of the order under appeal. It is thus clear that merely because an appeal is filed against the order of the Assistant Commissioner, the finality of that order is suspended. That order would be effective and subsisting, as observed by the Supreme Court, till it is set aside or nullified. It is, not, therefore, possible to say, as contended by Mr. Manohar, that by subjecting the order of the Assistant Commissioner to appeal, its finality had been suspended and hence the Commissioner could not have exercised his power of revision with regard to that order. We do not find any substance in this contention also.

36. The discussion above would indicate that limitation is sought to be put on the revisional power of the Commissioner by bringing in various considerations which we have discussed above. As pointed out, the power, which has been conferred by section 57, will have to be determined on the terms of section itself and, as we have seen, there is nothing in this section which would indicate that this power cannot be exercised because of the limitations which are sought to be put on it. We, therefore, find that the view taken by the Division Bench of this Court in Motor & Machinery Manufacturers' case [1976] 38 S.T.C. 78. does not require reconsideration.

37. In the result, therefore, we find that there is no substance in this petition and it deserves to be dismissed. The petitioner is dismissed and the rule is discharged. In the circumstances of the case, there will be no order as to costs.

38. At this stage Mr. Manohar prays for certificate of fitness for appeal to the Supreme Court. Since we have given our decision in this case on the basis of the various decisions of the Supreme Court, we do not think that this case involves a substantial question of law of general importance which needs to be decided by the Supreme Court. In the circumstances, therefore, we reject the prayer for certificate of fitness. Mr. Manohar submitted that the stay order which has been granted by this Court may be continued of a period of three weeks in order to enable the petitioner to file an appeal in the Supreme Court and obtain necessary orders therefrom. By order dated 11th April, 1978, this Court had allowed the Deputy Commissioner to proceed with the hearing of the revision and only delivery of final orders had been stayed. We feel that it is not necessary to stay the delivery of the final order and ends of justice would be met if the execution of the order which may be passed by the Deputy Commissioner is stayed for a period of six weeks from today in order to enable the petitioner to take appropriate steps before the Supreme Court for obtaining stay, if he so desires.

39. Petition dismissed.


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