S. Barman, J.
1. The following questions of law have been referred to this Court for opinion by the Sales Tax Tribunal Orissa, under Section 24(1) of the Orissa Sales Tax Act, 1947 :
(1) Whether Section 5(2)(a)(ii) [which is now Section 5(2) (A) (a) (ii)] of the Orissa Sales Tax Act, 1947, on the one hand and its proviso on the other hand are mutually exclusive in their applicability to a particular sale ?
(2) If sales tax has been realised from the purchasing dealer, irrevocably, under due process of law, though under an erroneous view on the applicability of the proviso to Section 5(2)(a)(ii) of the Act, can the same sales tax be recovered over again from the selling dealer ; and will not such recovery amount to an abuse of the process of law?
(3) In the facts and circumstances of the case was not the Tribunal justified in taking the declaration Ex. A into consideration under Clause (c) of Sub-rule (1) of Rule 61 of the Orissa Sales Tax Rules, 1947, as amended after the Amendment Act XX of 1957?
2. The relevent facts are as follows : The opposite party is a dealer in betel leaves; he was assessed on a gross turnover of Rs. 20,704 and a taxable turnover of Rs. 5,400 under Section 12(5) of the Orissa Sales Tax Act for the quarter ending 31st December, 1951. On first appeal, the assessment was enhanced in that the deduction on sales to registered dealer made by the assessing officer was disallowed for the reason that the opposite party had not produced and could not produce on demand the evidence as required under Rule 27(2) of the Orissa Sales Tax Rules. The opposite party being dissatisfied with the orders passed on first appeal came up on revision before the Commissioner of Sales Tax objecting to the levy of tax on estimated local sales amounting to Rs. 5,400 and the sales to registered dealer amounting to Rs. 15,304. The Tribunal held that since tax on the corresponding purchases has been levied though illegally on the purchasing registered dealer under the proviso to Section 5(2)(A)(a)(ii) and that since tax has been realised from the said purchasing dealer, the levy of tax on the sales made by the opposite party to the said registered dealer amounts to double taxation, and therefore, cannot be sustained. At the time of hearing, the opposite party filed a memorandum and a document purporting to be a declaration under Rule 27(2) signed by the purchasing registered dealer on a date after the date of disposal of the first appeal; the Tribunal held that the document is not admissible as evidence under Rule 61(l)(a) or (b) but it could be admitted under Rule 61(1) (c); the State Government objected to this admission on various grounds including that the document must first be proved to be a genuine one before being admitted ; the Tribunal overruled the said objection and admitted the document as evidence and allowed the deduction under Section 5(2)(A)(a)(ii). Therefore, the State Government made an application for reference of certain questions to this Court under Section 24(1) of the Act for decision. The Sales Tax Tribunal made an order of reference on the said application whereby it referred the said questions of law, hereinbefore quoted, for opinion of this Court.
3. In the present context, the settled legal position as laid down by this Court-so far as relevant for the purpose of answering the said questions-is this : Where on the strength of a certificate of registration of a registered dealer in which certain goods were specified as being intended for resale in Orissa, the registered dealer purchased those goods free of tax from another registered dealer and subsequently resold them outside Orissa, and the declaration, required by Rule 27(2) of the Orissa Sales Tax Rules, was not given by the purchasing dealer to the selling dealer, on the question, whether the purchasing dealer was liable to pay sales tax by virtue of the proviso to Section 5(2)(a)(ii), the Tribunal held that the purchasing dealer never gave any assurance that the goods covered by the transactions were intended for resale in Orissa and that consequently the goods were 'not used for purposes other than those specified in the certificate of registration' and the proviso to Section 5(2)(a)(ii) was not attracted ; this Court held that Rule 27(2) was only a rule of evidence and it was not exhaustive and that a statutory rule dealing with the mode of proof should not be relied on to modify the plain meaning of the provisions of the Act; that even in the absence of a declaration as required by Rule 27(2), the substantive right of a party to claim exemption or his liability to pay sales tax would be governed by the provisions of Section 5(2)(a)(ii); further that the purchasing dealer used the goods 'for purposes other than those specified in the certificate of registration', i.e., for the purpose of resale outside Orissa, and as such he was liable to pay sales tax by virtue of the proviso to Section 5(2)(a)(ii). It is also the settled position in law that the liability of a registered dealer to sales tax will arise if the facts necessary to establish exemption under Section 5(2) (a)(ii) of the Orissa Sales Tax Act, 1947, are not found irrespective of whether a declaration was obtained under Rule 27(2) of the Orissa Sales Tax Rules, 1947 ; the production of a declaration under Rule 27(2) is not always obligatory on the part of the selling dealer when claiming the exemption ; it is open to him to claim exemption by adducing other evidence so as to bring the transaction within the scope of Section 5(2) (a)(ii) of the Act: (Member, Sales Tax Tribunal, Orissa v. S. Lal & Co.  12 S.T.C. 25; Netrananda v. Commissioner of Sales Tax, Orissa  12 S.T.C. 169).
4. Considered in the light of this legal position, broadly stated above, our answer to the questions referred by the Sales Tax Tribunal are seriatim as follows :
5. Re: question No. 1.-Section 5(2)(a)(ii) with its proviso reads as follows:-
In this Act the expression 'taxable turnover' means that part of a dealer's gross turnover during any period which remains after deducting therefrom:
(a) his turnover during that period on
* * * *(ii) sales to a registered dealer of goods specified in the purchasing dealer's certificate of registration as being intended for resale by him in Orissa or for use by him in the execution of any contract in Orissa and on sales to a registered dealer of containers or other materials for the packing of such goods:
Provided that when such goods are used by the registered dealer for purposes other than those specified in his certificate of registration, the price of goods so utilised shall be included in his taxable turnover.
It is quite clear from the section itself, read with the proviso, as quoted above, that they are not mutually exclusive in their applicability to a particular sale ; indeed, the section and its proviso cannot be taken separately in their application to a particular case ; they both must be applied together, and in fact the proviso is by way of penalty or default clause in case of breach of condition in this section, in that while Section 5(2)(a)(ii) allows certain deduction in respect of goods intended for sale in Orissa or for use as specified in the section, the proviso lays down that, in case the goods are used for other purposes, then the dealer, will not get the benefit of the deduction allowed in Section 5(2)(a)(ii), and instead the price of goods so utilised shall be included in the dealer's taxable turnover. This interpretation of the section and the proviso is supported by the decisions cited above. Our answer to this question, accordingly, is in the negative, namely, that Section 5(2)(A)(a)(ii) of the Act on the one hand and its proviso on the other are not mutually exclusive in their applicability to a particular sale.
6. Re: question No. 2.-In the light of the settled legal position as stated above, our answer to first part of this question is in the affirmative, namely, that if sales tax has been realised from the purchasing dealer, irrevocably, under due process of law, though under an erroneous view on the applicability of the proviso to Section 5(2)(a)(ii) of the Act, the same sales tax can be recovered over again from the selling dealer, because sales tax must be collected from the right person, and it is no answer that it was collected from the wrong person.
From this, it will necessarily follow that our answer to the second part of this question is in the negative, namely, that such recovery of sales tax will not amount to an abuse of the process of law.
7. Re: question No. 3.-In view of the position that, in the present case, the tax has been realised from the purchasing dealer, this question is now academic and we need not express any view. While it is clear that under Rule 61 the Tribunal has residuary powers in the matter of adducing fresh evidence, whether oral or documentary, such powers must be exercised subject to certain limitations and restrictions as laid down in the provisos (a), (b) and (c) to Section 61. The corresponding provision in the Civil Procedure Code is Order 41, Rule 27, relating to production of additional evidence in appellate court. The Privy Council and the Courts in India have repeatedly held that the power given by this rule in the Civil Procedure Code should be exercised very sparingly and that great caution should be exercised in admitting new evidence. In our opinion, the object and spirit of Rule 61 (c) of the Orissa Sales Tax Rules are the same as of Order 41, Rule 27, Civil Procedure Code. In the present case, the State Government had objected to the admission of a document purported to be a declaration under Rule 27(2) signed by the purchasing registered dealer on various grounds as aforesaid. The Tribunal, however, overruled the said objection and admitted the document in evidence. In view of the fact, that the tax has already been realised from the purchasing dealer as aforesaid, it is needless to express any opinion on the point.
8. The result, therefore, is that the answer to question No. 1 is in the negative ; the answer to first part of question No. 2 is in the affirmative, and the answer to second part of question No. 2 is in the negative as aforesaid ; with regard to question No. 3, apart from the general observations we have made on the point as above, it is needless to give any answer to the question for reasons as aforesaid.
As the opposite party has not appeared, we make no order as to costs of this reference.
R.K. Das, J.
9. I agree.