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C.L. Hajee Abdul Subhan and Co. Vs. Commissioner of Commercial Taxes - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtKarnataka High Court
Decided On
Case NumberWrit Petn. No. 54 of 1958
Judge
Reported inAIR1959Kant201; AIR1959Mys201; [1960]11STC113(Kar)
ActsMysore Board of Revenue Act, 1955 - Sections 4, 4(1), 7 and 13; Mysore Revenue Appellate Tribunal Act, 1957 - Sections 11; Mysore Sales Tax Act, 1948 - Sections 4(1) and 15; Mysore Sales Tax (Amendment) Act, 1957 - Sections 40 and 40(2); Mysore Board of Revenue Rules, 1955 - Rule 24; Constitution of India - Articles 226 and 227
AppellantC.L. Hajee Abdul Subhan and Co.
RespondentCommissioner of Commercial Taxes
Appellant AdvocateG.S. Ullal, Adv.
Respondent AdvocateD.M. Chandrasekhar, High Court Govt. Pleader
Excerpt:
.....as having been made for the purpose of carrying out any purpose other than those specified in the mysore board of revenue act, one of which is that the board of revenue shall have the power to hear and dispose of revision petitions presented under the mysore sales tax act, 1948. any other construction would make the position of the petitioner worse since it would lead to the result that rule 24, if it can be regarded as conferring for the first time a new jurisdiction on the mysore board of revenue, which it did not possess under the act would be far in excess of the rule making power conferred by section 13 of the mysore board of revenue act and would thus become clearly invalid. the commissioner of commercial taxes in this case, in disposing of that application made, what i regard as..........in this writ petition was an assesses whose turnover was taxed under the provisions of the mysore sales tax act, 1948. a revision petition preferred by him in respect of that assessment was pending before the mysore board of revenue, which under the provisions of section 4 (1) of the mysore board of revenue act, was empowered to hear and dispose of revision petitions presented under the provisions of the mysore sales tax act, 1948.on the date on which that revision petition was posted for arguments, it was dismissed for default by the board on account of the non-appearance of the assesses or his counsel. the assessee then made an application for the restoration of that revision petition and when that application was still pending before the board, the board itself was abolished.....
Judgment:

A.R. Somnath Iyer, J.

1. The petitioner in this Writ Petition was an assesses whose turnover was taxed under the provisions of the Mysore Sales Tax Act, 1948. A revision petition preferred by him in respect of that assessment was pending before the Mysore Board of Revenue, which under the provisions of Section 4 (1) of the Mysore Board of Revenue Act, was empowered to hear and dispose of revision petitions presented under the provisions of the Mysore Sales Tax Act, 1948.

On the date on which that revision petition was posted for arguments, it was dismissed for default by the Board on account of the non-appearance of the assesses or his Counsel. The assessee then made an application for the restoration of that revision petition and when that application was still pending before the Board, the Board itself was abolished by the provisions of the Mysore Revenue Appellate Tribunal Act (Mysore Act No. 24 of 1957). Meanwhile the Mysore Sales Tax Act, 1948 was replaced by the Mysore Sales Tax Act, 1957 (Mysore Act No. 25 of 1957) which came into force on 1-10-1957.

It was provided by Section 40 of the said new Mysore sales Tax Act that all pending proceedings under the Mysore Sales Tax Act, 1948, should be continued as if that Act had not been repealed. It was also provided by Sub-section. (2) of Section 40 of the Mysore-Act No. 25 of 1957 that the Government could specify the authority which should exercise the functions exercisable under the Mysore Sales Tax Act, 1948.

2. By a notification made by the Government under Section 40 (2) of the Mysore Act 25 of 1957, the Commissioner of Commercial Taxes was specified as the authority who should exercise the functions exercisable under the Mysore Sales Tax Act, 1948.

3. The application for the restoration of the revision petition which had been presented by the assessee to the Board of Revenue was heard by the Commissioner of Commercial Taxes by virtue of his appointment under the provisions of Section 40 (2) of Mysore Act 25 of 1957. He dismissed that application for the reason that the Board having dismissed the revision petition presented by the assessee for default, he could not restore the revision petition which had been so dismissed by the Board.

4. It is this order by the Commissioner of Commercial Taxes that is brought up before us in this Writ Petition for being quashed.

5. Mr. Ullal the learned Advocate for the petitioner contends before us that the Commissioner of Commercial Taxes had no competence to hear the application presented by the assessee for the restoration of his revision petition. His contention is that that application has to be heard by the Mysore Revenue Appellate Tribunal to whom, under the provisions of Section 11 of the Mysore Revenue Appellate Tribunal Act, all proceedings which were pending before the Board of Revenue, on the date on which that Act came into force, stood transferred. Mr. Ullal's contention is that the application of the petitioner for the restoration of his revision petition also stood transferred to the Mysore Revenue Appellate Tribunal under the provisions of the said section.

6. In C. P. 200/58 this Court has taken the view that after the abolition of the Board of Revenue under the Mysore Revenue Appellate Tribunal Act and after the repeal of the Mysore Sales Tax Act of 1948, all revision petitions under the Sales Tax Act, 1948 that were pending before the Board of Revenue when it was abolished have to be heard by the Commissioner of Commercial Taxes by virtue of the notification promulgated by the Government under Section 40 (2) of the Mysore Sales Tax Act, 1957.

7. In C. P. 197/58 this Court has also taken the view that if the Board of Revenue, by the time it stood abolished had disposed of a revision petition under the provisions of Section 4 (1) of the Mysore Board of Revenue Act and an application for the review of the order made by it in such a revision petition was still pending before it, when the Mysore Revenue Appellate Tribunal Act came into force, that review petition could not be heard by the Commissioner of Commercial Taxes appointed under Section 40 (2) of the Mysore Sales Tax Act, 1957. In that case this Court also was of the view that that review petition stood transferred to the Mysore Revenue Appellate Tribunal under the provisions of Section 11 of the Mysore Revenue Appellate Tribunal Act leaving the question open as to whether the Revenue Appellate Tribunal to whom it stood so transferred had or had not the jurisdiction to hear and dispose of that review petition.

8. The position as a result of the decisions in the above cases is that after the Board of Revenue ceased to function, a revision petition presented under the Mysore Sales Tax Act, 1948 which was pending before it when it ceased to exist, has to be heard by the Commissioner of Commercial Taxes in Mysore. It is also likewise clear that a review petition which was pending before the Board ot Revenue in respect of such revision petition which it had disposed of under the Mysore Board of Revenue Act stood transferred to the Mysore Revenue Appellate Tribunal although the question as to whether that Tribunal could hear and dispose of that review petition was left open and not decided.

9. Mr. Ullal docs not, in this case, ask us to take a different view on the above two matters. But he urges that the application made by the petitioner to the Board of Revenue in this case which was pending before it when it ceased to function was not a revision petition but only an application for its restoration and so was not covered by the decision in C. P. No. 200/58. So he contends, the Commissioner of Commercial Taxes who actually disposed of that petition was not competent to hear it. He urges that that application, was either an application for a review of the order made by the Board of Revenue, in the exercise of its powers under Section 7 of the Mysore Board of Revenue Act and therefore covered by the decision of this Court rendered in C. P. 197/58 or that that application was for the restoration of revision petition which had to be disposed of in the exercise of a specific power conferred on the Board in regard to that matter by rule 24 of the Mysore Board of Revenue Rules made under Section 13 of the Mysore Board of Revenue Act.

That being the position his contention is, that while the Commissioner of Commercial Taxes could not hear that application for the reason that the power to do so was not conferred upon any authority under the provisions of the Mysore Sales Tax Act, 1948, the Board of Revenue alone had the power to dispose of that application as a result of such power having been conferred on it by the rule on which he relies. The Board having ceased to function by reason of the provisions of the Mysore Revenue Appellate Tribunal Act, the proceedings relating to the restoration of the revision petition stood, according to Mr. Ullal, transferred to the Mysore Revenue Appellate Tribunal and that Tribunal was the authority which had the power to hear and dispose of it.

10. It appears to me that neither of these two contentions can stand scrutiny. The first contention urged by Mr. Ullal that the application for the restoration of the petitioner's revision petition was an application for a review of the order made by the Board is, in my opinion, quite insubstantial. It is true as pointed out by this Court in C. P. No. 197/58 that the power to review its own Orders was conferred on the Board by Section 7 of the Mysore Board of Revenue Act which had not been conferred on any of the authorities functioning under the Mysore Sales Tax Act, 1948. Section 7 under which that power was conferred reads as follows:

'7. Review of Orders;-- (1) The Board may, either on its own motion, or on the application of any party affected, review any order passed by itself and pass such orders in reference thereto as it deems necessary.

Provided that no such application made by any party shall be entertained unless the Board is satisfied that there has been a discovery of new and important matter or evidence which after the exercise of due diligence was not within the knowledge of such party or could not be produced by him at the time when the Order was passed or that there has been some mistake or error apparent on the face of the record or that there has been any other sufficient reason:'

The rest of the section is not material for our present purpose.

11. It is clear from that section that before the Board could review its own orders, it should be satisfied that there has been a discovery of new and important matter of evidence or that there has been some mistake or error apparent on its face or that there has been any other sufficient reason, which, it is plain, has to he analogous to the other grounds mentioned in that section. It can hardly be contended that when the Board is asked to restore a revision petition which had been dismissed for default, it is asked to exercise a power of review on any of the grounds aforementioned.

The only question which the Board has to consider, when it deals with that application is whether there was sufficient cause for the non-appearance of the petitioner or his counsel. That being the position, it is impossible to uphold the contention of Mr. Ullal that the power to be exercised by the Board in respect of the application made before it for the restoration of the revision petition which it dismissed for default was in the nature of a power to review its own orders. In that view of the matter, the decision of his Court in C. P. 197/58 can have no application to the present case.

12. The other contention which survives for decision is whether, as Mr. Ullal suggests, the power to restore a revision petition which the Board of Revenue has dismissed for default or dismisses for default is a power which is distinct and different from the revisional jurisdiction which it exercises under Section 4(1) of the Mysore Board of Revenue Act read with the relevant provisions of the Mysore Sales Tax Act, 1948. Mr. Ullal contends that it is such a distinct power conferred on the Board by Rule 24 of the Mysore Board of Revenue Rules. That rule reads as follows:

24. 'The following applications shall be accompanied by an affidavit made by the applicant or petitioner or his authorised agent :

i) For review made on the ground of the discovery of new and important matter or evidence or for any other sufficient reason;

ii) For re-admission or restoration of an appeal or application dismissed on default of appearance;

iii) For substitution of parties.' Clause (ii) of this Rule was what applied to this case since the application made by the petitioner to the Board was for readmission or restoration of the revision petition which had been dismissed for default. Mr. Ullal urges that it is under this Rule that the Board of Revenue in this case possessed the power to restore a revision petition dismissed for default and that that power was quite independent of the power that it possessed under Section 4(1) of the Mysore Board of Revenue Act to dispose of a revision petition presented under the provisions of the Mysore Sales Tax Act, 1948.

13. Now it has to be noticed that Rule 24 is one of those Rules which was made under the provisions of Section 13 of the Mysore Board of Revenue Act That section provides among other matters that the State Government may by notification make rules to carry out all or any of the purposes of the Act. It is therefore plain that Rule 24 was a rule made for the purpose of carrying out the purposes of the Act One of the purposes of the Act was that the Board of Revenue should hear a revision petition presented under the provisions of the Mysore Sales Tax Act, 1948, The Act itself confers no power on the Board in express terms to restore a revision petition dismissed by it for default.

That being the position, Rule 24 which only provides for the manner in which an application for the re-admission or the restoration of an application dismissed for default of appearance should be made could not be regarded as having been made for the purpose of carrying out any purpose other than those specified in the Mysore Board of Revenue Act, one of which is that the Board of Revenue shall have the power to hear and dispose of revision petitions presented under the Mysore Sales Tax Act, 1948.

Any other construction would make the position of the petitioner worse since it would lead to the result that Rule 24, if it can be regarded as conferring for the first time a new jurisdiction on the Mysore Board of Revenue, which it did not possess under the Act would be far in excess of the rule making power conferred by Section 13 of the Mysore Board of Revenue Act and would thus become clearly invalid.

14. It is, I think, indisputable that when the Board of Revenue entertains or disposes ot an application for the restoration of a revision petition under the Sales Tax Act 48 which it is competent to hear under the provisions of the Act, it exercises no other jurisdiction than its revisional jurisdiction conferred on it by Section 4(1) of the Mysore Board of Revenue Act read with Section 15 of the Mysore Sales Tax Act, 1948. The jurisdiction that it exercises in that way cannot but be regarded as forming part of its revisional jurisdiction.

Had it not been so, if would be difficult to hold that it had any jurisdiction at all either to entertain or dispose of an application made for that purpose. The position therefore is that when the petitioner in this case applied to the Board of Revenue to restore his revision petition, he was asking for the exercise by the Board of no other jurisdiction than its own revisional jurisdiction.

That revisional jurisdiction, as this Court has held in C.P. 200/58, has now to be exercised as a result of the provisions of Section 40 of the Mysore Sales Tax Act, 1957, by the Commissioner of Commercial Taxes, in accordance with the notification made under Section 40(2) of that Act.

15. Any other view would lead to the incongruous result that whereas an application for the restoration of a revision petition has to be heard by the Mysore Revenue Appellate Tribunal, soon after that application is allowed and the revision petition is restored, the revision petition itself would have to be heard by the Commissioner of Commercial Taxes as we have held in C.P. 200/58. It is, I think manifestly unreasonable to interpret the provisions of Section 40 of the Mysore Sales Tax Act, 1957 and Section 11 of the Mysore Re-venue Appellate Tribunal Act in that way.

16. The result is when the Commissioner of Commercial Taxes heard the application presented by the petitioner for the restoration of his revision petition, he was acting entirely within his competence.

17. But the mere fact that we come to that conclusion does not take us to the end of this case. The Commissioner of Commercial Taxes in this case, in disposing of that application made, what I regard as a clearly unjustifiable order. He dismisses that application on the ground that since the Board of Revenue had already dismissed the petitioner's revision petition which it did for the default of the petitioner and his Counsel, he had no power to do anything in the matter.

The conclusion which he reached in that way was clearly the result of a misconception in his mind. It did not occur to him that the jurisdiction to restore a revision petition dismissed for default, forming as I have held part of the revisional jurisdiction which is now conferred on him under the provisions of Section 40 of the Mysore Sales Tax Act, 1957, it was his duty to dispose of the application for the restoration of the revision petition on its merits without declining such jurisdiction merely on the ground that the Board qt Revenue had already dismissed the revision petition for default.

18. In the result, this writ petition has to be allowed although not on all the grounds which were urged by Mr. Ullal in support of it. In my opinion although we should hold that the Commissioner ct Commercial Taxes had the competence to dispose of the application presented by the petitioner for the restoration of his revision petition, we must quash his Order which is now brought up before us on the ground that he declined to exercise his jurisdiction in the manner in which he did- His order is therefore set aside and the application made by the petitioner is remitted to him for disposal according to law in the light of the observations contained in this Order.

19. In the circumstances of this case, we make no order as to costs.

S.S. Malimath, J.

20. I agree.

21. Petition allowed.


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