Skip to content


The Ashoka Brick Kiln Co-operative Industrial Society Ltd. Vs. State of Punjab and anr. - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtPunjab and Haryana High Court
Decided On
Case Number Civil Writ No. 1 of 1965
Judge
Reported in[1969]23STC43(P& H)
AppellantThe Ashoka Brick Kiln Co-operative Industrial Society Ltd.
RespondentState of Punjab and anr.
Appellant Advocate H.L. Sarin, Sr. Adv.,; A.L. Bahl and; H.S. Awasthy,
Respondent Advocate Anand Swaroop, Adv.-General
Cases ReferredSurinder Nath Khosla v. Excise and Taxation Commissioner
Excerpt:
.....in the category of orders referred to clause (a) to (w) of order 43, rule 1 and also such other orders which poses the characteristic and trapping of finality and may adversely affect a valuable right of a party or decide an important aspect of a trial in an ancillary proceeding. amended section 100-a of the code clearly stipulates that where any appeal from an original or appellate decree or order is heard and decided by a single judge of a high court, no further appeal shall lie. even otherwise, the word judgment as defined under section 2(9) means a statement given by a judge on the grounds of a decree or order. thus the contention that against an order passed by a single judge in an appeal filed under section 104 c.p.c., a further appeal lies to a division bench cannot be..........sales tax act (hereinafter called the act). another point raised is that for the recovery of the sales tax levied, respondent no. 2 called upon the members of the petitioner-society to pay the amounts due and actually arrested five of the twelve members who were released after the orders had been passed by a motion bench while admitting the writ petitions on the 4th of january, 1965. these three petitions related to the years 1958-59, 1959-60 and 1960-61 respectively.2. in the petitions it had been stated that the petitioner-society filed appeals against the orders of the assessing authority before the deputy excise and taxation officer, ambala, who is the appellate authority but these appeals were dismissed as barred by time and revisions were filed before the excise and taxation.....
Judgment:

Bal Raj Tuli, J.

1. This judgment will dispose of three petitions. Civil Writs Nos. 1, 2 and 3 of 1965 filed by Ashoka Brick Kiln Co-operative Industrial Society Ltd., Faridabad, for the quashing of the assessment orders for the years 1958-59, 1959-60 and 1960-61 under the Punjab General Sales Tax Act (hereinafter called the Act). Another point raised is that for the recovery of the sales tax levied, respondent No. 2 called upon the members of the petitioner-society to pay the amounts due and actually arrested five of the twelve members who were released after the orders had been passed by a Motion Bench while admitting the writ petitions on the 4th of January, 1965. These three petitions related to the years 1958-59, 1959-60 and 1960-61 respectively.

2. In the petitions it had been stated that the petitioner-society filed appeals against the orders of the Assessing Authority before the Deputy Excise and Taxation Officer, Ambala, who is the appellate authority but these appeals were dismissed as barred by time and revisions were filed before the Excise and Taxation Commissioner under the Act. I, therefore, do not propose to decide the correctness or the validity of the orders of assessment or the appellate orders passed in these cases by the respondents. The petitioner can follow the remedies under the Act before invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution.

3. The important point of law which I am called upon to decide in these cases is with regard to the recovery proceedings started by respondent No. 2 for the recovery of sales tax levied from the members of the petitioner-society by arresting them or attaching their properties. The petitioner-society is a co-operative society registered under the Co-operative Societies Act, 1912, and the liability of the members is limited. It is thus evident that the members of the society cannot be held liable for the debts of the society and they are only liable to contribute to the assets of the society to the extent of the liability undertaken by them. This liability can be enforced against them by the society while it is a going concern and by the liquidator after it is ordered to be wound up. The only exception is that under Section 67 of the Punjab Co-operative Societies Act, 1961, any amount due to the Government in the said Act can be recovered from the members to the extent of their liability. The sales tax levied on the petitioner-society cannot be said to be 'sums due to Government under the Punjab Co-operative Societies Act, 1961' and, therefore, cannot be recovered from the members of the society under that section.

4. It was held by a Division Bench of this Court (Dua and Mahajan, JJ.) in Surinder Nath Khosla v. Excise and Taxation Commissioner, Punjab, and Anr. [1964] 15 S.T.C. 838, that the managing director of a limited company registered under the Indian Companies Act cannot be arrested for the realisation of arrears of sales tax due under the Blast Punjab General Sales Tax Act, 1948, from the limited company and an incorporated company is a juristic person which is a separate entity distinct from any individual shareholder and the business carried on by the company belongs to it in its juristic capacity and not to its shareholders. These observations of the learned Judges apply equally to the case of a co-operative society wherein the liability of the members is limited. It is, therefore, held that the members of the society are not liable for the payment of the sales tax levied on the petitioner-society and no amount on this account can be recovered from them either by the attachment and sale of their properties or by their arrest or any other coercive method.

5. For the reasons given above these petitions are accepted only to the extent that it is held that the members of the petitioner-society are not liable for the payment of the sales tax levied against it and no amount of sales tax can be recovered from them by any coercive method of attachment and sale of their properties or by their arrest or in any other method. The petitions with regard to other reliefs are dismissed leaving the petitioner to its remedies under the Act. In view of the partial success the parties are left to bear their own costs.


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