Skip to content


Carnatic Coffee Co. Vs. Commercial Tax Officer, I Circle, Davanagere - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtKarnataka High Court
Decided On
Case NumberWrit Petition No. 13655 of 1977
Judge
Reported in[1985]58STC367(Kar)
ActsCentral Sales Tax Act, 1956; Central Sales Tax (Amendment) Act, 1969
AppellantCarnatic Coffee Co.
RespondentCommercial Tax Officer, I Circle, Davanagere
Advocates:B.P. Gandhi, Adv.
Excerpt:
.....of mining lease. it is true that no specific time limitation is given for granting approval by the central government, but that does not mean that the central government could take its own sweet time, which would be unreasonable and arbitrary, because any such delay would affect the economic growth of the state. in that view of the matter, there is no error or illegality on the part of the petitioner in approaching high court for seeking appropriate direction to both central and state government to process the applications in accordance with the policy decision taken by them, as the petitioner is entitled to seek such relief based on legitimate expectation. therefore, (i) the proposed end use of the minerals by the applicant; and (ii) the captive consumption and value addition of..........1. for the assessment year 1963-64 (ugadi year), the petitioner was a registered dealer under the central sales tax act, 1956 (hereinafter referred to as the act) on the file of the commercial tax officer, davanagere (hereinafter referred to as the cto), who by his order dated 31st october, 1967 (exhibit-a) assessed him under that act to a tax of rs. 10,667.98 on inter-state sale transactions of coffee effected during the said year. against the said order of the cto, the petitioner filed an appeal in appeal no. cst. ap 14/67-68 before the deputy commissioner of commercial taxes (appeals), bangalore (hereinafter referred to as the dc), who by his order dated 20th march, 1968 (exhibit-b) allowed the said appeal and held that the petitioner was not liable to pay any central sales tax for.....
Judgment:
ORDER

Puttaswamy, J.

1. For the assessment year 1963-64 (Ugadi year), the petitioner was a registered dealer under the Central Sales Tax Act, 1956 (hereinafter referred to as the Act) on the file of the Commercial Tax Officer, Davanagere (hereinafter referred to as the CTO), who by his order dated 31st October, 1967 (exhibit-A) assessed him under that Act to a tax of Rs. 10,667.98 on inter-State sale transactions of coffee effected during the said year. Against the said order of the CTO, the petitioner filed an appeal in Appeal No. CST. AP 14/67-68 before the Deputy Commissioner of Commercial Taxes (Appeals), Bangalore (hereinafter referred to as the DC), who by his order dated 20th March, 1968 (exhibit-B) allowed the said appeal and held that the petitioner was not liable to pay any Central sales tax for the said period and cancelled the assessment of the CTO. In allowing the said appeal, the DC was guided by the law declared by this Court in Yaddalam Lakshminarasimhiah Setty v. State of Mysore [1962] 13 STC 583; 40 Mys LJ 577 which was affirmed by the Supreme Court in the appeal filed by the State on other grounds, since reported in State of Mysore v. Yaddalam Lakshminarasimhiah Setty and Sons : [1965]2SCR129 , which was later rendered ineffective by enacting the Central Sales Tax (Amendment) Act, 1969 (Central Act 28 of 1969) (hereinafter referred to as the Amending Act).

2. On the basis of the Amending Act, the DC after due notice to the petitioner, made an order on 7th October, 1970 (exhibit-C) rectifying the previous assessment order for the assessment year 1963-64 and again brought the inter-State sale transaction for the said period to tax under the Act. Against the said order of the DC the petitioner filed an appeal before the Mysore Sales Tax Appellate Tribunal, Bangalore (hereinafter referred to as the Tribunal), which by its order dated 30th August, 1973 (exhibit-D) allowed the said appeal and cancelled the order made by the DC on 7th October, 1970, which has become final. But the CTO, without noticing the effect of the said order of the Tribunal, has issued an order of attachment proposing to recover the amounts assessed to taxes for the assessment year 1963-64. In this petition under article 226 of the Constitution, the petitioner has challenged the said attachment order and has sought for a mandamus to refund him the sum of Rs. 9,000 stated to have been paid by him as taxes for the aforesaid assessment year.

3. Among others, the petitioner has urged that in the face of the order of the Tribunal, notwithstanding the Amending Act, there was no legal and effective assessment order made against him for the assessment year 1963-64 on the basis of which taxes can be recovered from him.

4. In justification of his action, the respondent has filed his return.

5. Sri B. P. Gandhi, learned counsel for the petitioner, contends that whatever be the effect of the Amending Act, there was no legal and effective assessment order made against his client for the assessment year 1963-64 under the Act and therefore, it was not open to the authorities to recover any amount for the aforesaid assessment year.

6. Sri L. M. Pandurangaswamy, learned High Court Government Pleader, in justifying the action of the authority contends that the petitioner cannot escape the liability notwithstanding the order made by the Tribunal in his favour.

7. Earlier, I have set out the proceedings initiated by the authorities under the Act for the assessment year 1963-64, which show that on the basis of the Amending Act, the DC rectified his earlier order and brought the petitioner to tax for the assessment year 1963-64. But, unfortunately that order had a short life. In an appeal filed by the petitioner against the order, the Tribunal interfered and annulled the same. The result of the order of the Tribunal was that there was no assessment order, much less a rectification order made against the petitioner for the assessment year 1963-64, on the basis of which taxes could be recovered for the said period from the petitioner. In making the rectification order, the DC relied on the Amending Act and made the rectification order. But, the Tribunal, for reasons with which we are not concerned, did not accept the same and interfered with that order, which has become final. In this view, there is no legal basis to recover taxes from the petitioner for the period in question.

8. As long as there is no legal and effective assessment order made under the Act for any period, which necessarily includes a rectification order, the authority cannot recover any amounts for that period, notwithstanding the Amending Act that has rendered the judgments of the Supreme Court and this Court ineffective and validated the assessments and recoveries, if any, made thereto. In this view, the petitioner is not liable to pay any Central sales tax for the assessment year 1963-64. When once it is found that the petitioner is not liable to pay any Central sales tax for the assessment year 1963-64, he is entitled for refund of the amounts, if any, paid by him for that period and he is not liable to pay any further amounts that have not already been paid by him for the aforesaid period.

9. In the light of my above discussion, I make the following orders and directions :

(a) I declare that there is no legal and effective order made under the Central Sales Tax Act, against the petitioner for the assessment year 1962-63 and therefore, he is not liable to pay any Central sales ta for the aforesaid period.

(b) I direct the respondent to refund the taxes, if any, paid by the petitioner for the assessment year 1963-64.

10. Writ petition is disposed of in the above terms. But, in the circumstances of the case, I direct the parties to bear their own costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //