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Rajnandgaon Roadways Private Ltd., Rajnandgaon Vs. the Tax Officer-cum-regional Transport Officer, Raipur and ors. - Court Judgment

LegalCrystal Citation
SubjectOther Taxes
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 314 of 1969
Judge
Reported inAIR1972MP87; 1972MPLJ274
ActsMadhya Pradesh Motor Vehicles (Taxation of Passangers) Act, 1959 - Sections 10
AppellantRajnandgaon Roadways Private Ltd., Rajnandgaon
RespondentThe Tax Officer-cum-regional Transport Officer, Raipur and ors.
Appellant AdvocateY.S. Dharmadhikari, Adv.
Respondent AdvocateKu. Rama Gupta and ;R.P. Sinha, Advs.
DispositionPetition dismissed
Cases ReferredM.P. Singh v. Anand Transport Co.
Excerpt:
- - 1. this is a petition under article 226 read with article 227 of the constitution whereby the petitioner a private limited transport company, operating stage carriages, challenges its liability, under the provisions of the madhya pradesh motor vehicles (taxation of passengers) act, 1959 (hereinafter called the act) to pay to the state government, the passengers tax collected by it, for the period 1-2-1961 to 6-5-1962 and which it had failed to deposit into the government treasury in accordance with the provisions of section 6 of the act. 2. the only question that arises for consideration is whether a tax payable by a stage carriage operator under section 6 of the act in accordance with, the return submitted by it under section 5 of the act, which he had failed to deposit into a.....naik, j. 1. this is a petition under article 226 read with article 227 of the constitution whereby the petitioner a private limited transport company, operating stage carriages, challenges its liability, under the provisions of the madhya pradesh motor vehicles (taxation of passengers) act, 1959 (hereinafter called the act) to pay to the state government, the passengers tax collected by it, for the period 1-2-1961 to 6-5-1962 and which it had failed to deposit into the government treasury in accordance with the provisions of section 6 of the act. 2. the only question that arises for consideration is whether a tax payable by a stage carriage operator under section 6 of the act in accordance with, the return submitted by it under section 5 of the act, which he had failed to deposit into a.....
Judgment:

Naik, J.

1. This is a petition under Article 226 read with Article 227 of the Constitution whereby the petitioner a private limited transport company, operating stage carriages, challenges its liability, under the provisions of the Madhya Pradesh Motor Vehicles (Taxation of Passengers) Act, 1959 (hereinafter called the Act) to pay to the State Government, the passengers tax collected by it, for the period 1-2-1961 to 6-5-1962 and which it had failed to deposit into the Government treasury in accordance with the provisions of Section 6 of the Act.

2. The only question that arises for consideration is whether a tax payable by a stage carriage operator under Section 6 of the Act in accordance with, the return submitted by It under Section 5 of the Act, which he had failed to deposit into a Government treasury within the time prescribed or ever could be recovered from it under the provisions of Section 10 of the Act as arrears of land revenue.

3. The question has been answered in the affirmative by a Division Bench of this Court in Madhya Pradesh Transport Co. (P.) Ltd.. Raipur v. The Tax Officer-cum-The Regional Transport Officer, Raipur, 1966 MPLJ 650 wherein inter alia the contentions that as the case was not covered by the provisions of Sections 7, 8 or 9 of the Act, no notice of demand could be issued under Section 10(1) of the Act nor could the liability be realised as arrears of land revenue by any coercive process under Section 10(2) of the Act was negatived and it was held that the liability could be recovered as arrears of land revenue under the provisions of Sub-section (2) of Section 10 of the Act. But in a later case reported in Raipur Transport Co. (P.) Ltd. v. M.P. Singh Dy. Transport Commr., Madhya Pradesh, Gwalior. 1967 MPLJ 773 - (AIR 1968 Madh Pra 36) a contrary view appears to have been taken. This later case says that there the operator has submitted a return and has not paid the tax amount as laid down under Section 6 of the Act, 'the Tax Officer has necessarily to make an enquiry as regards the completeness or correctness of the return filed and the deposit of the tax by the operator, in accordance with Section 7': and it was only when the amount payable by the operator was so determined that a notice of demand could be served on him under Sub-section (1) of Section 10 of the Act. In this judgment no reference was made to the decision in 1966 MPLJ 650(supra).

4. This Full Bench has been constituted to resolve the aforesaid conflict.

5. Before discussing the question, we may briefly narrate the facts which have given rise to the controversy.

6. The Act came into force on 1-2-1961. Its validity was challenged in Misc. Petn. No. 111 of 1961 (Madh Pra) and it was inter alia held that as the Act did not under Section 3 thereof, authorise the operators to collect the tax from the passengers as extra fare, the Act could not become operative till that was done: Madhya Pradesh Transport Co. (Pvt.) Ltd., Raipur v. State of M.P., 1962 MPLJ 633 = (AIR 1962 Madh Pra 108). The State Legislature thereafter passed the Madhya Pradesh Motor Vehicles (Taxation of Passengers) Amendment and Validation Act, 1962 for removing the aforesaid lacuna. This amending Act was also challenged inMisc. Petn. No. 292 of 1962 (Madh Pra) but unsuccessfully. The decision is reported in Madhya Pradesh Transport Co, (Pvt.) Ltd.. Raipur v. State of Madhya gradesh, AIR 1963 Madh Pra 339.

7. Even thereafter, even though (the petitioner filed its return as required by Section 5 of the Act. it avoided to deposit the tax into the Government treasury as required by Section 6 of the Act. Consequently, the petitioner was served with a notice of demand in respect of the passengers tax payable by it under Section 6 of the Act for the period 8-8-1961 to 28-3-1962. This was challenged by it in Misc. Petn. No. 268 of 1965 which was heard along with Misc. Petn. No. 179 of 1965 and as per decision in the case D/- 23-2-1966 reported in 1966 MPLJ 650(supra), the challenge of the petitioner to the notice of demand was reflected. Dixit. C.J., speaking for the Division Bench said:--

'It is true that the tax amount, which Is now being recovered from the petitioners, is one which they should have deposited in the Treasury when they filed the returns and is not a tax amount determined against them either under Section 7 or 8 or the amount of a penalty Imposed on them under Section 9. But from the wording of Sub-section (2) of Section 10, it is plain that the method of recovery of the tax amount as arrears of land revenue is not confined only to the amount of tax determined under Section 7 or 8 to the amount of penalty under Section 9.'

xx xx xx xx xx

'It follows, therefore, that though for the recovery of the amount of tax, which an operator should have paid under Section 6 of the Act, the first sub-section of Section 10 is not attracted, yet that tax amount by virtue of the provisions of Sub-section (2) can be recovered by the sale of the stage carriage or carriages in respect of which it was due and the accessories thereof, and the attachment and sale of the carriages and the accessories can be under the appropriate law relating to the recovery of arrears of land revenue. Thus there is no bar to the recovery of the tax amount as arrears of land revenue from the petitioners at least by the attachment and sale of the stage carriage or carriages and the accessories thereof in respect of which it was due. The amount cannot, however. be recovered from the petitioners as arrears of land revenue by attachment and sale of their other property.'

8. In the meanwhile one Raipur Transport Co. (Pvt.) Ltd., had also challenged the recovery of passengers tax from it, which it had failed to deposit Into Government treasury under Section 3of the Act, by coercive process, as arrears of land revenue. This was registered as Misc. Petn. No. 305 of 1966 and decided on 8-11-1966 (Madh Pra). The decision is reported in 1967 MPLJ 773 -> (AIR 1968 Madh Pra 36). In this decision no mention is made of the earlier decision in Misc. Petn. No. 179 of 1965, D/- 23-2-1966 reported in 1966 MPLJ 650(supra) and a contrary view appears to have been laid down as stated earlier.

9. Relying on the aforesaid view, the petitioner again challenges the recovery of the passengers tax from it which it had failed to deposit under Section 6 of the Act for the period 1-2-1961 to 5-5-1962 on the ground that before issuing any notice of demand or before resorting to coercive process for the recovery of the tax as arrears of land revenue, the tax officer had necessarily to make an enquiry as regards the completeness or correctness of the return filed and pass an order of assessment and as that had not been done, the proceedings for the recovery of the tax were liable to be quashed.

10. Now the scheme of the Act for the recovery of the passengers tax from the operators is as follows--

Sub-section (1) of Section 3 of the Act levies a tax on all passengers carried by stage carriages at the prescribed rate payable to the operators.

Sub-sections (1-A) and (1-B) then authorise the operators to collect the tax as extra fare and to pay it to the State Government in accordance with the provisions of the Act.

Section 5 provides for submission of returns by the operators in the form and manner prescribed either daily or at such intervals as may be prescribed. The returns are delivered to the tax officer or to such prescribed officer as the tax officer may specify. When a return is received by a prescribed officer he has to forward it to the tax officer within the time prescribed and in the manner prescribed.

Section 6 then says--

'The tax payable during any month in accordance with the returns submitted under Section 5 shall be paid into a Government treasury by the operator and the receipt evidencing such payment forwarded to the Tax Officer, on or before such date or dates of the month immediately succeeding as may be prescribed in the case of fleet-owners and other operators.'

Section 7 prescribes for procedure for the assessment of the tax where no returns are filed as required by Sec. 5 aforesaid or where the returns so filed 'appear to the Tax Officer to be incorrect or incomplete.'

Section 8 deals with tax escaping assessment. It says--

'If, for any reason, the whole or any portion of the tax leviable under this Act, for any month has escaped assessment, the Tax Officer may, at any time within, but not beyond, one year from the expiry of that month, assess the tax which has escaped assessment, after issuing a notice to the operator and making such inquiry as the officer may consider necessary.'

Section 9 provides for penalty for non-payment of tax under the provisions of Sections 6. 7 and 8.

Section 10 deals with the recovery of the tax. It says--

'(1) In the cases referred to in Sections 7. 8 and 9 the Tax Officer shall serve on the operator a notice of demand for the sums payable to the State Government and 'the sums specified in such notice may be recovered from the operator as arrears of land revenue.

(2) The tax shall be a first charge on the stage carriage in respect of which it is due as also on its accessories and such stage carriage and the accessories thereof may be attached and sold for the recovery of the tax under the appropriate law relating to the recovery of arrears of land revenue.'

Section 11 bars, subject to certain concessions, the use of stage carriages in respect of which any tax or penalty is due from the operator or in respect of which no returns are filed as required by, Section 5.

Section 12 provides for appeal to the prescribed authority, if the operator feels aggrieved by the notice of demand served on him under Section 10.

11. The provisions of the Act relating to the recovery of the tax may, graphically be reproduced as follows:

________________________________________________________________________

| |

Return filed No return filed

(Section 5 of the Act) [assessment (under Section 7 of the Act) and

| recovery under Section 10(1) of the Act.)]

_________________|__________________________________________

| |

Return accepted Return incomplete or incorrect

(expressly or impliedly) [assessment (under Section 7 of the Act) and

| recovery under Section 10(1) of the Act.)]

____|_____________________________________________

| |

Tax paid Tax not paid

[Liability to deposit (under |

Section 6 of the Act.)] __________________|___________________________

| |

Penalty imposed No penalty imposed

[imposition (under Section 9 of the Act) and [recovery (under Section 10(2)

recovery (under Section 10(1) of the Act)] of the Act.)]

12. After an operator has collected the tax, two contingencies may arise: either he files a return as required by Section 5 of the Act, or he does not file a return. If he does not file a return, an assessment has to be made against him under Section 7 of the Act and the recovery of the tax so assessed as arrears of land revenue has to be preceded by the service on the operator of a notice of demand under Section 10(1) of the Act.

13. Where the return has been filed, it may be accepted by the Tax Officer expressly or impliedly. In neither case, there is to be an assessment which, under the scheme of the Act, envisages some sort of an enquiry after notice to the operator. In case of acceptance of the return, no enquiry of any kind is necessary, as there is acceptance of the assessment of the tax made by the operator himself as it were.

14. If, however, it appears to the Tax Officer that the return filed is incorrect or incomplete, he has to make a correct and complete assessment which he is enjoined to do under Section 7 of the Act. The recovery of the tax so assessed has again to follow the procedure prescribed in Section 10(1) of the Act.

15. Now, where the return filed under Section 5 of the Act has been accepted by the Tax Officer expressly or impliedly because it appeared to him to be neither incorrect nor incomplete, the Act envisages no order of assessment as such by the Tax Officer. The Act envisages that the operator in such cases shall voluntarily pay the tax which, according to his return, he has admitted to be due from him, into the Government Treasury within the prescribed time. It is significant to note that the filing of the receipt before the Tax Officer evidencing the payment of the tax into the Government Treasury by the operator under Section 6 of the Act has not been made a part and parcel of the return. If it were so, the non-filing of such receipt would have made the return filed under Section 5 of the Act incomplete and the provisions of Section 7 of the Act would have been attracted. Forms of return are prescribed under Rule 4 of the M.P. Motor Vehicles (Taxation of Passengers) Rules, 1959 (hereinafter called 'the Rules') and a perusal of the forms (Form I to Form IV) shows that they do not require any statement from the operator that the tax as per the return filed by him had been paid by him into the Government Treasury. It may also be noted that while the returns are to be filed daily, weekly or monthly, as the case may be, the submission of receipts evidencing the payment of the tax has to be made monthly: (see Section 6 of the Act and Rule 7 of the Rules), which again shows that the filing of the receipt evidencing the payment of the tax has not been made a part of the return.

16. Two contingencies thus arise when the return filed under Section 5 of the Act has been accepted expressly or impliedly. Either the tax is paid under Section 6 of the Act or it is not so paid. If tax has been paid, nothing more need be done. But if the tax has not been paid, what are the courses which are open to the Tax Officer? No doubt, he may proceed to impose a penalty on the defaulting operator under Section 9 of the Act for non-payment of the tax in terms of Section 6 of the Act, in which case he shall thereafter proceed to recover the penalty under Section 10(1) of the Act, but this section says nothing regarding the mode of recovery of the tax which the operator was legally bound to deposit under Section 6 of the Act and which he had not so deposited. In regard to the tax which the operator is required to deposit under Section 6 of the Act and which he has not so deposited, the Act makes no specific provision. But, even so, the undeposited tax is a liability owing by the operator to the State Government which, under Section 10(2) of the Act has been made a first charge on the stage carriage in respect of which it is due, as also on its accessories and the mode of enforcing the charge is also provided by the sub-section saying that 'such stage carriage and the accessories thereof may be attached and sold for the recovery of the tax under the appropriate law relating to the recovery of arrears of land revenue'. When the tax admittedly due from the operator on the basis of his return has not been paid under Section 6 of the Act, the quantum of the tax is not in dispute and there is, therefore, no need for an order of assessment which presupposes an undetermined liability for the payment of the tax; but when the case falls under Section 7 or under Section 8 of the Act, the quantum of the tax is in dispute--in the first case because no return is filed or because it appears to the Tax Officer that the return is incorrect or incomplete, and in the second case because for any reason the tax has escaped assessment and consequently an order of assessment becomes necessary to determine the tax liability of the defaulting operator. Similarly, in the cases falling under the second category, the penalty, being undetermined, has to be determined after notice to the parties and this penalty has also, under Section 10(1) of the Act, been made recoverable as arrears of land revenue. But in regard to the tax proper, the liability being already admitted as per the return, the only question is of the recovery of the tax which is recovered under Sub-section (2) of Section 10 of the Act.

17. Dealing with the question, the learned Chief Justice in M.P. Transport Company's case. 1966 MPLJ 650(supra) said:--

'It is true that the tax amount, which is now being recovered from the petitioners, is one which they should have deposited in the Treasury when they filed the returns and is not a tax amount determined against them either under Section 7 or 8 or the amount of a penalty imposed on them under Section 9. But from the wording of Sub-section (2) of Section 10, it is plain that the method of recovery of the tax amount as arrears of land revenue is not confined only to the amount of tax determined under Section 7 or 8 or to the amount of penalty under Section 9. It will be seen that the first sub-section speaks of a notice of demand for the sum payable being served on the operator in cases falling under Sections 7. 8 and 9, and further says that the sum specified in such notice may be recovered from the operator as arrears of land revenue. But the operation of the second sub-section is not confined to the tax determined under Section 7 or 8 or the penalty amount imposed under Section 9. That sub-section says that--

'The tax shall be a first charge on the stage carriage in respect of which it is due as also on its accessories and such stage carriage and the accessories thereof may be attached and sold for the recovery of the tax under the appropriate law relating to the recovery of arrearsof land revenue'.'

** ** ** **

It follows, therefore, that though for the recovery of the amount of tax. which an operator should have paid under Sec-tion 6 of the Act, the first Sub-section of Section 10 is not attracted, yet that tax amount by virtue of the provisions of Sub-section (2) can be recovered by the sale of the stage carriage or carriages in respect of which it was due and the accessories thereof, and the attachment and sale of the carriages and the accessories can be under the appropriate law relating to the recovery of arrears of land revenue. Thus there is no bar to the recovery of the tax amount as arrears of land revenue from the petitioners at least by the attachment and sale of the stage carriage or carriages and the accessories thereof in respect of which it was due. The amount cannot, however, be recovered from the petitioners as arrears of land revenue by attachment and sale of their other property.'

18. In our opinion, the aforesaid observations lay down the correct law and are a complete answer to the petitioner's objections raised in these proceedings.

19. It was, however, argued on the strength of Anandji Haridas & Co. (P) Ltd. v. S.P. Kasture, AIR 1968 SC 565 that the non-deposit of tax under Section 6 of the Act should be treated as on par with 'fare escaping assessment' within the meaning of Section 8 of the Act. The decision in that case can have no application to facts of our case because what the learned Judges by a majority decided therein was that the Supreme Court in Ghanshyam Das v. Regional Asst. Commr, of Sales Tax, Nagpur, AIR 1964 SC 766 had correctly defined the meaning of the expression 'escaped assessment' when they said that 'the expression 'escaped assessment' in Section 11-A of the Act (C.P. & Berar Sales Tax Act, 21 of 1947) includes that of a turnover which has not been assessed at all, because for one reason or other no assessment proceedings were initiated and therefore no assessment was made in respect thereof', the reason being -- 'As seen earlier it was the duty of the appellants not only to submit their quarterly returns but send along with those returns the treasury challans in proof of the payment of the tax admittedly due from them. As they have failed to do so within the prescribed period, it follows that the turnovers in question had escaped assessment.' The learned Judges had earlier pointed out -- 'Rule 19 of the rules framed under the Act provides that every registered dealer should furnish to the appropriate sales tax officer his quarterly return in the prescribed form within one calendar month from the expiry of the quarter to which the return relates. Each of such returns submitted should be accompanied by a treasury challan in the form prescribed 'in proof of the fact that he had paid the tax payable on the basis of his return.' It also appears that under the provisions of the Sales Tax Act there was no provision similar to Sections 5 or 6 of Madhya Pradesh Motor Vehicles (Taxation of Passengers) Act and that the scheme of the Sales Tax Act required an assessment order in all cases. In the case we are dealing with the scheme of the Act is that in eases where returns are submitted under Section 5 of the Act and it does not appear to the Tax Officer that the returns so submitted are incorrect or incomplete, there is neither occasion nor need to pass an assessment order. The assessment of tax made by the operator is accepted by the Tax Officer as the tax liability due from him to the State Government. In such cases, as pointed out by us earlier, no assessment of the tax by Tax Officer is necessary and the tax liability being admitted in terms of the returns submitted under Section 5 of the Act which are accepted by the Tax Officer expressly or impliedly, all that remains to be done is to direct its recovery as arrears of land revenue under Sub-section (2) of Section 10 of the Act.

20. Reliance is also placed on the decision in Raipur Transport Co. (P) Ltd.'s case. 1967 MPLJ 773 = (AIR 1968 Madh Pra 36) (supra) wherein it is laid down that before issuing a notice of demand, the Tax Officer has necessarily to make an order of assessment and even in cases where tax is not deposited in terms of Section 6 of the Act, the Tax Officer has necessarily to make an enquiry as regards the correctness or completeness of the returns filed and the deposit of the tax by the operator in accordance with Section 7 of the Act.

21. The observations of the Division Bench bearing on the question are contained in paragraph 6 of its judgment and read as follows:--

'It is plain from Section 7 of the Act that where no returns have been filed or where the returns submitted by the operator are incorrect or incomplete, the Tax Officer is required to determine the sum payable to the State Government by way of tax after making due enquiry. This clearly envisages an assessment proceeding and the making of an assessmnnt order. So also, where the whole or any portion of the tax leviable under the Act for any month has escaped assessment, the Tax Officer is required to assess the tax which has escaped assessment. It must be noted that Clause (b) of Section 7 nowhere speaks of the deposit or non-deposit of the tax amount under Section 6. That being so, no limitation of any kind can be read into that clause with reference to the deposit or non-deposit tinder Section 6 of the tax amount The Tax Officer has to determine the sum payable to the State Government by the operator by way of tax during the material month or portion thereof, no matter whether the operator has with the returns submitted by him under Section 5 deposited or not deposited the tax amount payable under Section 6. Where along with the return the tax amount has been paid and the Tax Officer does not find the return to be incorrect or incomplete, no question of giving the operator an opportunity of making his representation or of establishing the correctness or completeness of the return submitted by him can arise. Yet, the Tax Officer has to pass an order holding the operator liable for payment of the tax in accordance with the return submitted by him adding that the tax amount has, already been paid with the return. In such a case, the question of issuing a notice of demand for payment of tax amount cannot obviously arise. Where the operator has submitted a return and has not paid with it the tax amount as laid down under Section 6, the Tax Officer has necessarily to make an enquiry as regards the completeness or correctness of the return filed and the deposit of the tax by the operator in accordance with Section 7. It is only when the amount payable by the operator is determined that a notice of demand can be issued to him for payment of the tax. An operator objecting to the notice of demand served on him has a right of appeal under Section 12. But from this it does not follow that the Tax Officer is under no duty to pass an order determining the amount of tax payable by the operator before issuing a notice of demand against him. Indeed, Section 10 of the Act, when it says that in the cases referred to in Sections 7, 8 and 9 the Tax Officer shall serve on the operator a notice of demand for the sums payable to the State Government, presupposes that an order of assessment has been made under the earlier provisions of the Act. An order of assessment is necessary not only for the validity of the notice of demand, but also for enabling the appellate authority to see whether the tax has been correctly assessed or not and the demand made against the operator is or is not justified.'

22. The proposition laid down in the aforesaid paragraph may be summarised as follows:--

(i) The provisions of Sections 7 and 8 of the Act envisage an assessment of tax by the Tax Officer after due enquiry.

(ii) Section 7 (b) nowhere speaks of deposit or non-deposit of the tax amount under Section 6 of the Act and that being so no limitation of any kind can be read into that clause with reference to deposit or non-deposit of the tax under Section 6.

(iii) Whether the tax is deposited or non-deposited in terms of Section 6 of the Act in pursuance of the return filed under Section 5 of the Act, the Tax Officer has, in all cases, to determine the sums payable by the operator as tax to the State Government:--

(a) Where along with the return the tax has been paid by the operator and the Tax Officer does not find the return incorrect or incomplete, he has to pass an order holding the operator liable to tax in accordance with his return, adding that the tax has already been paid with the return.

(b) Where in terms of the return no tax has been paid by the operator as required by Section 6 of the Act, the Tax Officer has necessarily to make an enquiry in terms of Section 7 as regards the correctness or completeness of the return filed and the deposit of the tax.

(iv) A notice of demand has been made appealable under Section 12 of the Act and, therefore, every notice of demand must necessarily be preceded with an order of assessment, not only to make the notice of demand valid but also to enable the appellate authority to see that the tax has been correctly assessed or not and the demand is justified or not,

(v) A notice of demand under Section 10(1) of the Act presupposes the making of an order of assessment.

23. It is true that the provisions of Sections 7 and 8 of the Act envisage an assessment of the tax by the Tax Officer; but that is because in cases governed by those sections there has been no assessment of the tax either because no return had been filed, or because the return filed was incorrect or incomplete, or because for any reason the tax had escaped assessment. In our opinion, where, however, the operator himself has assessed the tax by admitting any amount as due from him as tax by filing a return which is neither incorrect nor incomplete and where there is no reason to hold that any tax or part of it has escaped assessment, no question of any further assessment of the tax by the Tax Officer arises. The amount admitted by the operator as due from him in his return and accepted by the Tax Officer expressly or impliedly as correct and complete is the tax assessed. We see no justification for holding that even in such cases a formal order of assessment must necessarily be passed. The scheme of the Act as we read it does not, in our opinion, envisage such an assessment.

24. The opinion of the learned Judges of the Division Bench in theRaipur Transport Co. (P) Ltd.'s case. 1967 MPLJ 773 = (AIR 1968 Madh Pra 36) (supra) that even in such cases an order of assessment is necessary appears to proceed from the premise that unless there is proof of payment of the tax under Section 6 of the Act. the return filed under Section 5 must necessarily be held to be incorrect or incomplete within the meaning of Section 7. We, however, see no justification for so holding. The section of the Act. as we have observed earlier, does not envisage the furnishing of evidence as to payment of the tax admittedly due as per the provisions of Sections 5 and 6 as a part and parcel of the return under Section 5 of the Act. Neither the language of Section 5 of the Act nor the forms of the return (Form I to Form IV) prescribed by the Rules require the payment under Section 6 of the Act to be certified as part of the return so that, in the absence of such evidence, the return could not be held to be incorrect or incomplete. We are further of opinion that the provisions of Section 7 of the Act have no application to such a case and in so far as the Raipur Transport Co. (P) Ltd.'s case, 1967 MPLJ 773 = (AIR 1968 Madh Pra 36) (supra) held that 'where the operator has submitted a return and has not paid with it the tax amount as laid down under Section 6, the Tax Officer has necessarily to make an enquiry as regards the completeness or correctness of the return filed and the deposit of the tax by the operator in accordance with Section 7 it was not correctly decided.

25. We may also point out that it is not every notice of demand that is made appealable under Section 12 of the Act but only such notices of demand as were made under Sections 7, 8 and 9 of the Act. Notices of demand under Section 10(1) of the Act must necessarily be preceded with an assessment order after due enquiry because in such cases there has been, in the nature of things, no determination of the tax liability or the penalty to be paid by the operator. But in cases where the amount of tax is admitted in the return under Section 5 of the Act and is not disputed by the Tax Officer expressly or impliedly no question of assessment of tax arises and such notices of demand requiring the operator to pay the tax or suffer coercive process for its recovery as arrears of land revenue have not to be preceded with any enquiry for the determination of the amount of tax liability which has already been admitted and accepted as such by the Tax Officer. In such cases, notices of demand, not having been made under Section 10(1) of the Act are not appealable as the tax liability having been ad-mitted and accepted by the Tax Officer there is nothing to appeal against.

26. In the result, we see nothing irregular or illegal in the notice of demand requiring the petitioner to pay its passenger tax liability which it ought to have deposited under Section 6 of the Act in pursuance of its return filed under Section 5 of the Act. nor do we see anything irregular or illegal in the State Government realising the said passenger tax dues from the petitioner by the attachment and sale of its stage carriages.

27. After my opinion had been prepared, and was under consideration of Bhave, J. the decision in M.P. Singh v. Anand Transport Co. (P) Ltd., AIR 1971 SC 2127 came which overruled the decision in 1967 MPLJ 773 = (AIR 1968 Madh Pra 36) which further supports my opinion that Raipur Transport Co. (P) Ltd., Raipur's case was not correctly decided.

28. The petition be dismissed with costs. Counsel's fee Rs, 200/-.

Bhave, J.

29. In a recent decision of the Supreme Court in AIR 1971 SC 2127 it has been held:--

'We are unable to accede to the contention which prevailed with the High Court that even where returns had been submitted but the tax has not been paid the Tax Officer is bound to make an order before serving a notice of demand even though the demand is strictly in accordance with the returns which have been submitted. Section 7 rules out any such course to be followed by the Tax Officer. It is only when the returns have not been submitted or when returns submitted are found to be incorrect and incomplete that the Tax Officer has to make an inquiry and determine the sum payable by the operator by way of tax. Similarly if there has been escapement of tax proceedings have to be taken under Section 8 and an order has to be made after an enquiry. The position would be same if penalty is sought to be levied under Section 9. But where returns have been accepted as correct nothing more need be done except to recover the tax due which has not been paid and no assessment order need be passed in view of the express language of Section 7.'

The result of this pronouncement is that the decision in 1967 MPLJ 773 = (AIR 1968 Madh Pra 36) stands overruled. I, therefore, agree with the order proposed by Naik, J.

G. P. Singh, J.

30. For the reasons given by Bhave, J., I agree that the petition be dismissed with costs.


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