S.S. Sandhawalia, C.J.
1. Whether a question of law not expressly adjudicated upon by the Tribunal, nor established to have been pressed before it, can still be presumed to arise out of its order within the meaning of Section 22(1) of the Punjab General Sales Tax Act, merely because it was taken in the grounds of appeal or revision is the significant and the oft-arising question which has necessitated this reference to the Full Bench. Equally at issue is the correctness of the Division Bench judgment in Kelvinator of India Ltd. v. Haryana State (G.S.T.C. No. 19 of 1966 decided on 20th January, 1970-Punjab and Haryana High Court), page 141 infra which impliedly answered the aforesaid question in the affirmative.
2. In General Sales Tax Reference No. 19 of 1975, the Presiding Officer of the Sales Tax Tribunal, Punjab, referred the following two questions for the opinion of this Court under Section 22(1) of the Punjab General Sales Tax Act:
(i) Whether, on the facts and the circumstances of the case, this case falls within the ambit of Section 11A or Section 21(1) of the Act ?
(ii) Whether the assessee in law was afforded reasonable opportunity by the revising authority before passing the order ?
The Division Bench, before which the matter came up in the first instance, was inclined to take the view that the second question did not arise out of the order of the Tribunal. However, the learned counsel for the assessee-petitioner pressed his claim on the ground that though the Tribunal had not dealt with the question in its order yet this had been specifically raised in the grounds of revision, annexure H and the positive stand taken was that such a question of law once raised in the grounds of revision even though not discussed or decided by the Tribunal would still be deemed to arise therefrom on the presumption that the same had been disallowed unless there was good evidence to show that it had been specifically given up. Basic reliance for this contention was on the Division Bench judgment of the Orissa High Court in Sitaram Kamal Prasad v. Collector of Sales Tax, Orissa AIR 1953 Orissa 7, which was later followed by the Division Bench of this Court in Kelvinator of India's case (G.S.T.C. No. 19 of 1966 decided on 20th January, 1970 -Punjab and Haryana High Court) page 141 infra. Specifically dissenting from the opinion expressed in Sitaram Kamal Prasad's case AIR 1953 Orissa 7 and consequently doubting the ratio in Kelvinator of India's case (G.S.T.C. No. 19 of 1966 decided on 20th January, 1970-Punjab and Haryana High Court) page 141 infra, the matter has been referred to the larger Bench to consider the correctness of the view in the latter judgment.
2A. Whilst considering the legal issue before us, I am inclined to the view that a very substantial ground thereof is now covered by the authoritative formulation of their Lordships in Commissioner of Income-tax, Bombay v. Scindia Steam Navigation Co. Ltd. AIR 1961 SC 1633. It, therefore, becomes unnecessary to launch on any exhaustive dissertation on principle. It would suffice to mention that the specific part of the language of Section 22(1) of the Act is in pari materia with the corresponding part in Section 66(1) of the Indian Income-tax Act of 1922. This similarity is manifest when the two provisions are juxtaposed with each other :
Section 22 of the Punjab Section 66(1) of the IndianGeneral Sales Tax Act Income-tax Act, 1922Section 22. (1) Within Within sixty days of the date60 days from the passing upon which he is served withof an order under Sect- the notice of an order under Sub-ion 20 or 21 by Tribunal, Section (4) of Section 33 theaffecting any liability assessee or the Commissioner may,of any dealer to pay tax by application in the prexscribedunder this Act, such form, accompanied where appl-dealer or the Commiss- ication is made by the assesseeioner may, by applic by a fee of one hundred rupees,ation in writing acco- requre the Appellate Tribunal,mpanied by a fee of to refer to the High Courtone hundered rupees any question of law arisingin case the applic- out of such order and theation is made by a Appellate Tribunal shall withindealer, require the ninety days of the receipt ofTribunal to refer to suchapplication draw up athe High Court any statement of the caseandquestion of law refer it to the High Court.arising out of suchorder.
3. However, before adverting to the ratio of the Scindia Steam Navigation's case AIR 1961 SC 1633, it is necessary to view the larger scheme of the Punjab General Sales Tax Act which cannot be lost sight of. Section 20 of this Act provides for an appeal whilst the succeeding Section 21 is the source for the exercise of the revisional power. Sections 21A and 21B deal with rectification of mistakes and disposal of pending appeals and applications. It is thereafter that Section 22 pertaining to a reference to the High Court finds its place. Even a broad conspectus of the aforesaid five sections would indicate that the legislature's concern was to restrict severely the field of reference to the High Court. Whilst the appellate power under Section 20 is obviously wide ranging, the revisional power under Section 21 is restricted to the legality and propriety of the proceeding only. The power of reference is even more constricted and hedged in by two pre-eminent conditions, namely, that the reference can only be on a question of law (barring all questions of fact) and not merely that but further that such a question of law must arise out of the order of the Tribunal itself. The obvious intent of the legislature and the scheme of the statute, therefore, is to narrow down and constrict the scope of a reference to the High Court in contradistinction to the appellate and the revisional jurisdictions. Therefore giving Section 22(1) a too wide interpretation would in essence be running counter to the purpose and object of its enactment. If the scope of reference to the High Court is construed as even wider or co-equal to that of the appellate jurisdiction then the very purpose of the constriction spelled out in Section 22(1) would be frustrated. I am inclined to the view that if one goes to the length of holding that every point of law catalogued in the grounds of appeal or revision must by a notional fiction be presumed to arise out of the order of the Tribunal even though it makes not the remotest reference thereto then this would open a Pandora's box on which the lid cannot easily be put back.
4. With the aforesaid broad approach in mind for constructing Section 22(1) one may now proceed to examine the matter basically within the four-corners of the formulation in Scindia Steam Navigation's case AIR 1961 SC 1633. Undoubtedly prior to this judgment there was a great divergence of judicial opinion in the High Court as stands noticed therein. On one side stood the narrower view as spelled out in A. Abboy Chetty and Co. v. Commissioner of Income-tax, Madras AIR 1948 Mad 181, in the following words of Patanjali Sastri, J. (as his Lordship then was):.Mr. Radhakrishnayya for the petitioner contends that a question, though not raised before the Appellate Tribunal, can well be said to 'arise out of its order', if, on the facts of the case appearing from the order, the question fairly arises. I am unable to agree with that view. I am of opinion that a question of law can be said to arise out of an order of the Appellate Tribunal only if such order discloses that the question was raised before the Tribunal, This accords with the view taken by the Lahore High Court of the provisions of Section 66(2) which in this respect used similar language before the section was amended by the amending Act of 1939....
The aforesaid view was accepted by a number of other High Courts, but a discordant note thereto was struck by Chagla, C.J., in Madanlal Dharnidharka v. Commissioner of Income-tax, Bombay City AIR (36) 1949 Bom 24, wherein he dissented from the observations in A. Abboy Chetty and Co's case AIR 1948 Mad 181. It, however, calls for notice that Tendolkar, J., who was the other member of the Division Bench, refrained from expressing any opinion on this point altogether. However, all this is now a matter of academic judicial history because of the synthesis arrived at by the final court in Scindia Steam Navigation's case AIR 1961 SC 1633 summing up and formulating the law authoritatively in the following four propositions in paragraph 31 of the report:
(1) When a question is raised before the Tribunal and is dealt with by it, it is clearly one arising out of its order.
(2) When a question of law is raised before the Tribunal but the Tribunal fails to deal with it, it must be deemed to have been dealt with by it and is, therefore, one arising out of its order.
(3) When a question is not raised before the Tribunal but the Tribunal deals with it, that will also be a question arising out of its order.
(4) When a question of law is neither raised before the Tribunal nor considered by it, it will not be a question arising out of its order notwithstanding that it may arise on the findings given by it.
Their Lordships further epitomised the legal position by observing as follows:
Stating the position compendiously, it is only a question that has been raised before or decided by the Tribunal that could be held to arise out of its order.
In the light of the above, the issue before us is narrowed down to the proper and the practical application of formulation Nos. (2) and (4). This is what now calls for some elaboration and the core question is as to what is the real import to be given to the words 'raised before the Tribunal'. Would it merely mean that the point of law should be one catalogued in the grounds of appeal or revision, or does it mean that such a law point must further have been argued and urged before the Tribunal To put it in other words, the issue is whether such a point of law should have been pressed and agitated before the Tribunal apart from having been merely taken in the grounds of appeal or revision. I am clearly of the view that the words 'raised before the Tribunal' connote the former and not the latter. It is true that loose terminology is sometimes used in this context and it is often said that a point has been raised in the grounds of appeal or revision. However, taking a point of law in the grounds of appeal or revision cannot be made synonymous with actually raising it before the Tribunal.
5. In strictness what can be said in the aforesaid situation is that the point was raised in the grounds of appeal or revision, yet it would not be raised before the Tribunal either because it may have been expressly given up or impliedly so because of the fact that it was not urged or argued before the Tribunal. Indeed, what their Lordships have succincfly formulated in Scindia Steam Navigation's case AIR 1961 SC 1633 is not that the point of law was raised in the grounds of appeal or revision, but in sharp distinction thereto that it had been raised before the Tribunal itself. I read this to mean that such a point of law must be urged, argued or pressed before the Tribunal either in oral arguments or expressly in written arguments, if so allowed. Merely because a point of law may find a place in a catalogue of others in the grounds of appeal or revision, cannot be equated with the question of law having been duly raised before the Tribunal stricto sensu. To be precise, therefore, a sharp distinction must be maintained betwixt the mere taking of a question of law in the grounds of appeal or revision and the actual arguing, raising or pressing the same before the Tribunal.
6. Once the true import of the phrase 'raised before the Tribunal' is settled, the real question in its practical application becomes one of the presumption that should be raised in a case where a point of law has neither been noticed nor adjudicated in the order of the Tribunal. The piquant situation which particularly falls for consideration is, where the question of law in fact has been taken in the grounds of appeal or revision, but the same is neither touched upon nor pronounced even remotely in the order of the Tribunal. What is the true presumption to be raised in such a case Is it that such a point of law must be deemed to have been raised because it found a place in the grounds of appeal or revision and it should be presumed that it was wrongly or inadvertently ignored by the Tribunal Or, is it in the reverse that because it finds no mention at all in the order, it must be presumed necessarily to have been either given up expressly or impliedly and consequently not raised before the Tribunal at all.
7. I take the view that the latter presumption (though rebuttable) is the one which is not only to be preferred, but can indeed be the only one which can be raised. The Tribunals and Judges are under a duty to deal with and adjudicate upon the points expressly raised before them. The essential requirement of a judgment or an order either when spelled out expressly by a statute or in the absence thereof on the larger principle is that it should consider and weigh the contentions of the respective parties and adjudicate thereon. The normal presumption, therefore, would be that the Tribunal or the court would perform its duty. Therefore, it would follow that ordinarily if such a point of law was raised, the Tribunal would have dealt with the same or in any case noticed it. There can hardly be any warrant for a presumption that the Tribunal must have failed in its duty by either deliberately ignoring a point of law raised before it or inadvertently omitted to do so. The necessary corollary thereof thus is that because the point of law has not been adjudicated upon or even noticed by the Tribunal then it must be presumed initially that it was not raised before it. In a somewhat analogous though not identical situation, their Lordships of the Supreme Court in Union of India v. T.R. Varma AIR 1957 SC 882 have observed as follows :
When there is a dispute as to what happened before a court or tribunal, the statement of the Presiding Officer in regard to it is generally taken to be correct and there is no reason why the statement of Mr. Byrne should not be accepted as true.
Consequently the burden would lie heavily on the person who wishes to establish the contrary and in terms to prove that the point of law was actually raised before the Tribunal, but it had failed to perform its duty by either adjudicating thereon or noticing it and giving its reasons for not doing so.
8. It is a matter of common experience that it is usual that the grounds of appeal or revision would take up every conceivable point meritorious or otherwise therein. Indeed, good draftsmanship would necessarily require this. From this it does not follow that every point of law taken up in appeal or revision must necessarily be pressed before the Tribunal and in fact may not even remotely be worth pressing. At the time of final arguments, sometimes a number of points raised in the grounds of appeal are not even adverted to or dilated upon by the counsel for the appellant or the petitioner. Indeed a sagacious Advocate would only press the most meritorious of law arising in his case and the rest are sometimes expressly or in any case impliedly given up the very factum of these having not been urged before the Tribunal. Again, there is no inflexible rule that the court or the tribunal must record that no point other than one adjudicated upon by it has been pressed during the course of the hearing. On the other hand, it is by now well-established that what is not adjudicated upon or noticed by the Tribunal in its order would be initially presumed to have not been raised before it. However, this presumption is not conclusive though the burden is heavy on the party to establish the contrary. Consequently, where a number of points of law find mention in the grounds of appeal or revision, but only some of them are expressly noticed or adjudicated upon by the Tribunal in its order, the presumption must be raised that the rest were given up expressly or impliedly. It cannot be in the reverse that unless it is positively shown that they are given up they must be deemed to have been both raised before the Tribunal and further presumed that they were deliberately or inadvertently ignored by it in dereliction of the duties laid by law.
9. I am firmly of the view that merely taking a point of law in the grounds of appeal or revision by itself cannot per se amount to raising it before the Tribunal. Indeed, cataloguing the points of law in such grounds only gives the counsel or the party, the right to raise it before the Tribunal because he may be otherwise precluded to do so either by the court confining him to its grounds or because of the objection of the opposite side on the grounds of prejudice and surprise. It would follow, therefore, that taking a ground in appeal or revision is merly a foundation for its eligibility for being canvassed before the Tribunal and not any presumption that it must necessarily have been so done before the Tribunal and further that the latter ignored the same.
10. In fairness to Mr. Narula, the learned counsel for the petitioner, I must notice that he attempted to base his case on the slender thread of certain observations made by Shah, J., in Scindia Steam Navigation's case AIR 1961 SC 1633. It sufficies to mention that Shah, J.'s judgment in that case is obviously in the nature of a dissent from the majority view and it has been so noticed in the report itself. It is worth recalling that in the later case of Commissioner of Income-tax, West Bengal v. Indian Molasses (Private) Ltd. AIR 1970 SC 2067 Shah J., speaking for the Bench unhesitatingly followed the majority view in Scindia Steam Navigation's case AIR 1961 SC 1633.
11. It remains now to advert to the correctness of their view in Sitaram Kamal Prasad's case AIR 1953 Orissa 7. It is manifest that the learned Judges therein did not themselves even remotely intend to lay down any rule of law and it was expressly mentioned that it was unnecessary to canvass this question fully or to express any opinion thereon (in paragraph No. 6 of the Report). Apparently, they approved or in any case did not dissent from the enunciation of the rule in A. Abboy Chetty and Co. v. Commissioner of Income-tax, Madras AIR 1948 Mad 181 and that they were within the narrower rule therein to hold what they did. It is not in dispute that Patanjali Sastri, J. (as his Lordship then was), in A. Abboy Chetty and Co.'s case AIR 1948 Mad 181 has taken the strictest view in this context to the effect that unless the question of law was dealt with in the order of the Tribunal itself, it cannot be deemed to arise out of it. Mr. R. N. Narula, the learned counsel for the petitioner, conceded that the view in A. Abboy Chetty and Co.'s case AIR 1948 Mad 181 was directly contrary to his stand and had in fact attempted to assail the same. With the greatest respect it appears to us that the learned Judges in Sitaram Kamal Prasad's case AIR 1953 Orissa 7 whilst purporting to apply what they themselves called the 'narrower rule', in actual fact gave it the widest application. A close analysis of the number of observations in the last paragraph No. 6 of the Report would show that the conclusion arrived at does not even remotely flow from A. Abboy Chetty and Co.'s case AIR 1948 Mad 181 and in fact appears to be running directly counter to the same. It was sought to be held that if a point was taken in the grounds of appeal or revision, then it must be presumed to have been raised before the Tribunal and arises out of its order on the presumption that it was ignored by it, unless it is shown conclusively that such a point was expressly given up. I am of the view that this conclusion cannot possibly be sustained on the ratio of A. Abboy Chetty and Co.'s case AIR 1948 Mad 181. No other reason whatsoever was given and it appears obvious that the matter was not adequately canvassed or gone into in depth because as noticed earlier, their Lordships themselves did not intend to express any opinion thereon. With the greatest respect, I am inclined to hold that the observations on this point in Sitaram Kamal Prasad's case AIR 1953 Orissa 7 are not good law and would record my dissent therefrom and the more so, in view of the subsequent authoritative formulation in the Scindia Steam Navigation's case AIR 1961 SC 1633.
12. Once the above finding is arrived at, it necessarily follows that the judgment in Kelvinator of India Ltd.'s case (G.S.T.C. No. 19 of 1966 decided on 20th January, 1970, Punjab and Haryana High Court) page 141 infra also can no longer hold the field. I was a party to that judgment and it is manifest therefrom that the Bench had merely followed Sitaram Kamal Prasad's case AIR 1953 Orissa 7. In fact it was expressly noticed that on first impression it was the view that only one question of law, namely, the first one arose out of the order. However, the counsel pressed and placed his reliance on Sitaram Kamal Prasad's case AIR 1953 Orissa 7 and since it was not at all challenged by the other side, the issue was not examined in depth or on principle and the view in Sitaram Kamal Prasad's case AIR 1953 Orissa 7 was followed. No additional or independent reasoning, whatsoever, was given. Consequently it must be held that for the reasons recorded in the context of examining the ratio of Sitaram Kamal Prasad's case AIR 1953 Orissa 7, Kelvinator of India Ltd.'s case (G. S. T. C. No. 19 of 1966 decided on 20th January, 1970-Punjab and Haryana High Court) infra is also not good law and is hereby overruled.
13. To conclude, the answer to the question formulated at the very outset is rendered in the negative. The case would now go back to the Division Bench for a decision in accordance therewith as also for examining the other questions arising therein.