P.N. Khanna, J.
(1) This judgment will dispose of three writ petitions, being CWs 156-D and 215-D of 1965 and 91-D of 1966. The petitioners in CWs 156-D and 215-D of 1965 are the firm named and styled as Messrs Madho Ram, Lal Chand, Charanjit Singh, Harbans Lal Khosla, Bhagwat swarup and B. R. Chawla, and its six partners, whose names form part of the said firm's name. The respondents in both these petitions are the Sales-tax Officer, Ward No. 2, Delhi, the Commissioner of Sales-tax, Delhi, and the Union of India, through the Secretary, Ministry of Home Affairs, Government of India, New Delhi. The petitioners in Cw 91-D of 1966 are the firm, run under the name and style of Messrs Kidar Nath, Lal Chand, Madho Ram, Jagdev Singh, Sunder Lal and B. R. Chawla, and its six partners. The five respondents in this petition are the Sales-tax Officer, Ward No. 11, the Sales-tax Officer, now holding charge of Ward No. 14, Commissioner of Sales-tax, Collector of Delhi, and the Union of India. As the questions of law and fact, involved in these petitions are common, arguments were addressed in Cw 215-D of 1965 only, which were said to be applicable to the other cases as well. Reference to facts wherever necessary, will be made in this judgment to the facts of Cw 215-D of 1965; but the reasoning and conclusions are applicable to all the three petitions, which are being disposed of by this common judgment.
(2) In Cw 156-D of 1965, the period for which the assessment of sales-tax is involved is June 4, 1964 to June Ii, 1964 and June 12, 1964 to December 31, 1964. In Cw 215-D of 1965, the relevant period consists of the months of January and February, 1965. The relevant period in Cw 91-D of 1966 is June 4, 1965 to August 25, 1965 and August 26, 1965 to September 21, 1965. The petitioners in the first two petitions carried on their business of purchase and sale of country liquor under a license auctioned by the Excise Department, Delhi, for the excise year 1964-65 (1-4-1964 to 31-3-1965), while the petitioners in the third petition had the country liquor license for the excise year 1965-66 (1-4-1965 to 31-3-1966).
(3) The sale of country liquor was 'exempt from payment of sale-tax levied under the Bengal Finance (Sales-tax) Act, 1941, as extended to the State of Delhi (now the Union Territory of Delhi), herein called 'the Act', in view of the provisions of section 6(1) of the Act read with entry 40 of the Schedule of exempted goods which read as follows:
'ALLgoods on which duty is or may be levied under the Punjab Excise Act 1914, as extended to the State of Delhi or the Opium Act, 1878.'
The Central Government has the authority under sub-section (2) of section 6 of the Act to, inter alia, omit any item from the Schedule of exempted goods after giving notice in the official gazette of its intention to do so. Orginally, the said sub-section required this to be 'not less than three months' notice'. These words in the inverted comas were substituted by the words 'such previous notice as it considers reasonable' by an amending notification dated December 7, 1956. A notification accordingly was issued by the Government of India, Ministry of Finance, on October 20, 1956, the relevant portion whereof reads as follows:
'INexercise of the powers conferred by sub-section (2) of section 6 of the Bengal Finance (Sales-tax) Act, 1941, as extended to the State of Delhi, the Central Government hereby gives three months' notice of its intention to make the following amendment in the Schedule to the said Act. 1 to 3. 4. Item 40 shall be deleted. 5. ... ... ... '
Instead of amending the Schedule on the expiry of three months from the date of the said notification, the Central Government in partial modification of the said notification, issued another notification No. 372 dated 27th March, 1958), noticing its intention to omit item 40 from the Schedule with effect on and from 1st April, 1958. On April 1, 1958, the Central Government issued the following notification amending the Schedule:
'INexercise of the powers conferred by section 6 of the Bengal Finance (Sales-tax) Act, 1941, (Bengal Act 6 of 1941), as extended to the Union Territory of Delhi, the Central Government hereby makes with effect on and from the first day of April 1958, the following amendments in the second Schedule to the said Act, namely:- 1 to 6. ... ... ... ... ... 7. Item No. 40 shall be omitted. 8. ... ... ... ... ... ...'
(4) It has been pleaded that while proceedings for registration of the petitioner were pending before the Sales-tax Officer, Ward No. 11, who is said to be the only 'appropriate assessing authority', competent to deal with the petitioners' case, the Sales-tax Officer, in-charge of Ward No. 2. who is one of the respondents in all these petitions, served on the petitioner firm a notice requiring it to appear before him on December 2, 1964 with complete books of account in connection with its application for registration and by his order dated December 19, 1964 registered the petitioner firm under section 7 of the Act, fixing its liability to pay tax from June 4, 1964, prescribing monthly returns to be filed by 7th of following month. The petitioner firm filed all its returns adding a foot-note on such return saying that the turn-over declared was exclusive of excise duty and license fee, which, according to the petitioner, did not form part of the sale price. The Return was said to be filed under protest and without prejudice to the petitioner's contention that the withdrawal of exemption from sales-tax of country liquor was invalid and the Sales-tax officer of Ward No. 2 had no jurisdiction in the matter. Notices under section 11(1) were served upon the petitioner firm requiring it to produce its books of account. Written objections to the proposed assessments were filed reiterating the same objections, as were mentioned in the foot-note added to each return. The Sales-tax Officer did not accept the accounts of the firm, made an assessment and created additional demands by adding estimated sales, excise duty and license fee. Simultaneously with the completion of the assessments, show-cause notices under section 22-A of the Act were served on the petitioner firm in Cw 156-D of 1965 and Cw 215-D of 1965 only, requiring it to explain why penality be not imposed upon it for concealing its turnover and furnishing inaccurate particulars of its sales. Replies were filed, but the petitioners' objections were overruled. A penalty of Rs. 19,800.00 was imposed in the case, which is the subject matter of Cw 156-D of 1965 and Rs. 3000.00 in the case of Cw 215-D of 1965. No penalty notice was issued nor penalty imposed in the matter of Cw 91-D of 1966.
(5) In the writ petitions, it has been pleaded that the omission of Item No. 40 from the schedule of exempted goods was illegal and void. It was further contended that the excise duty and the license fee could not be added to the price. The authority of respondent No. I, the Sales-tax Officer, Ward No. 2, to make the assessment and levy the penalty was also challenged. Best Judgment assessments were also called in question on the ground that no opportunity to show cause against the proposed assessments or the penalty was given to the petitioners. On this basis, a prayer was made for inter alia, quashing the assessment orders and the orders imposing penalties and the notices of demand.
(6) Mr. Nayyar, the learned counsel for the petitioners raised the same four contentions in support of the petitions, viz:
(1)Item No. 40 in the Schedule of exempted goods was omitted from the said Schedule and the exemption given to country liquor from the levy & sales-tax, was thus withdrawn without giving a reasonable previous notice of the Government's intention to do so, as required by section 6(2) of the Act; (2) The order of the assessing authority adding excise duty and license fee paid by the petitioners to the price of liquor sold for the purpose of computing the petitioners' turnover was unjustified, for the said duty and the fee were no part of the price; (3) The place of business of the petitioners was situated within the jurisdiction of the Sales-tax Officer, Ward No. 11, while the assessments in question were made by the Sales-tax Officer, Ward No. 2, who had no jurisdiction or authority to make the said assessment or to levy the penalty; and (4) The best judgment assessments as made by the Sales-tax Officer were had in law as no opportunity was given to the petitioners to show cause against the proposed assessments.
(7) The first contention of the learned counsel is based on the wording of section 6(2) of the Act, which as amended reads as follows:
'(2)The Central Government, after giving by notification in the Official Gazette, such previous notice as it considers reasonable of its intention so to do. may like notification add to or omit from or otherwise amend the Second Schedule and thereupon the second Schedule shall be deemed to be amended accordingly.'
On October 20, 1956, a notification was issued by the Government of India (Ministry of Finance), as already noticed, giving three months notice of its intention to amend the Schedule by deleting from it item No. 40. The three months expired on January 19, 1957. The Central Government in partial modification of the said notification issued another notification dated March 27, 1958 notifying its intention to omit Item No. 40 from the Schedule with effect on and from April 1, 1958. On April 1, 1958, the final notification was issued by the Central Government in exercise of the powers conferred on it by section 6 of the Act, omitting the said Item No. 40 from the said Schedule. The contention of Mr. Nayyar is that no amendment having been introduced on January 19, 1957, when the three months period given in the first notification expired or immediately thereafter, the notification lapsed. The new notification, which was counsel, however, is not tenable. Section 6(2) as it originally stood issued on March 27, 1958 gave a notice of three days only which could not be said to be a reasonable notice. The contention of the learned and as already mentioned, required 'not less than three months' and as already mentioned, required 'not less than three months' notice of the Government's intention to omit any item from the Schedule of he exempted goods. Such a notice was duly given on October 20, 1956. Thereafter, the section was amended with effect from December 7, 1956, requiring the giving of a reasonable notice. This amendment was considered by a Division Bench of this court in Union of India v. Laxmi Narian, Lpa 53 of 1971, decided on November 18, 1971(1), when its validity was affirmed. The public at large in the Union Territory of Delhi, was fully aware as a result of the notification dated October 20, 1956 that the Government intended to delete item No. 40 from the Schedule of exempted goods. It cannot be said that the said notification lapsed after the expiry of three months. The second notification dated March 27, 1958 did not indicate any change in the Government's intention. The omission of item 40 from the Schedule of exempted goods with effect on and from the first day of April, 1958 cannot, under the circumstances, be said to have been effected without a reasonable previous notice, as required under the Act. This contention of Mr. Nayyar, thereforee, has no merit.
(8) The second contention of Mr. Nayyar that the excise duty and license fee do not form part of the price is equally devoid of force. The tax or the duty or the fee when charged from the customer along with the price pure simple cannot be anything different from the price itself. The price may include the tax and it cannot be said that the purchaser of goods has been taxed when he pays the price in which the amount of duty or fee or tax is included. In George Oakes (Private) Limited v. State of Madras, : 2SCR570 the Supreme Court made a reference with approval to the following observations of Lawrence J. in Paprika Ltd. v. Board of Trade, 1944 (1) All E.R. 372(3):
'WHENEVERa sale attracts purchase tax that tax presumably affects the price, which the seller who is liable to pay the tax, demands but it does not cease to be the price which the buyer has to pay even if the price is expressed as X plus purchase tax'.
The following observations of Goodard L. J. in Love v. Norman Wright (Builders) Ltd. 1944 (1) All E.R. 618(4), was also quoted by the Supreme Court with approval :
'WHEREan article is taxed, whether by purchase tax, customs duty, or excise duty, the tax becomes part of the price which ordinarily the buyer will have to pay'
This view was reiterated by the Supreme Court in Delhi Cloth and General Mills v. Commissioner of Sales-tax. Indore, Air 1972 Sc 2216(5). The excise duty and the license fee has, thereforee, rightly been held to be a part of the price. The contention of the learned counsel, thereforee, is not maintainable.
(9) Mr. Nayyar then contended that the place of business of the petitioners was within the jurisdiction of the Sales-tax Officer, Ward No. 11 who is the only 'appropriate assessing authority' competent to deal with the petitioner's case. The Sales-tax Officer in-charge of Ward No. 2 has no jurisdiction to make the assessment in the case of the petitioners. The location of the place of business, urged the counsel, determines the jurisdication of the Sales-tax Officer and the petitioners' place of business being situated outside the territorial jurisdiction of the Sales-tax Officer, Ward No. 2, the assessment order and the order imposing penalty were nullity. It is difficult to agree with this contention.
(10) The power to assess tax has been conferred by section 11 of the Act on the Commissioner. Section 15 of the Act provides, inter alia, that subject to such restrictions and conditions as may be prescribed, the Commissioner may by order in writing delegate any of his powers under the Act to any person appointed under section 3 to assist him. Sales-tax Officers have been appointed under section 3 of the Act to assist the Commissioner. Clause (m) of sub-section (2) of section 26 of the Act, enables the making of rules prescribing 'the restrictions and conditions subject to which the Commissioner may delegate his powers under section 15'. Rules have been duly framed under the Act. The appropriate assessing authority' has been defined by rule 2(b) as meaning, inter alia, in respect of any particular dealer, the Sales-tax Officer within whose jurisdiction the dealer's place of business is situated. Rule 32 empowers the appropriate assessing authority to serve a notice on the dealer concerned for the purpose of making an assessment. Rule 38 provides that a Sales-tax Officer in charge of any area shall exercise the powers of the assessing authority in relation to all dealers within his territorial jurisdiction. It is significant to note that none of these rules excludes the power of any other Sales-tax Officer to issue the requisite notices and to make the assessment, if otherwise such power can be spelt out from the other provisions of the Act or the Rules. By virtue of the powers vested in him by section 15 of the Act, the Commissioner delegated his powers and duties under the Act, under section Ii, inter alia, to make assessment of tax or to impose penalty under the relevant provisions to the Sales-tax Officer by his order of delegation of powers and duties dated August 4, 1961, and directed that the said powers and duties shall be exercised and discharged by the said officers within their respective jurisdiction and 'in respect of other assesseds when specifically authorised to do so.' The Sales-tax Officers of the specified wards were empowered to make assessment of tax and impose penalties in respect of the assesseds whose places of business were within their jurisdiction. The Commissioner could still authorise any Sales-tax Officer to make an assessment and impose penalty in respect of an assessed whose place of business was not within his jurisdiction. The Commissioner of Sales-tax on November 25, 1964 issued the following order:-
'SHRIH. G. Sekhri, Sales-tax Officer, Ward No. 2 is declared as Assessing Authority in the case of M/s. Madho Ram Lal Chand, Country Liquor dealer, Pusa Road, New Delhi, a dealer of Ward No. 11.'
By a corrigendum issued on December 9, 1964, the Commissioner gave the correct name of the assessed as M/s. Madho Ram Lal Chand, Charnjit Singh, Harbans Lal Khosla, Bhagwat Swarup and B. R. Chawla, instead of M/s. Madho Ram Lal Chand. Thus, the power of an assessing authority for the purpose of the assessment of the petitioners was specifically delegated to the Sales-tax Officer, Ward No. 2, which was a valid delegation under section 15 of the Act. The. assessment made and the penalty imposed by the Sales-tax Officer, Ward No. 2 on the petitioners, thereforee, were in order and the challenge to the authority and jurisdiction of the said Sale-tax Officer to do so is without any basis.
(11) The last contention of Mr. Nayyar was that no opportunity was given to the petitioners to show cause against the proposed assessments, which were said to be unreasonable. There is no dispute about the notices having been properly issued and the petitioners having filed their objections and been given proper personal hearing. There is, thereforee, hardly any scope for this court to interfere, while exercising jurisdiction under Article 226 of the Constitution. The objection still is that before fixing the quantum of sales, the petitioners should have been given a further opportunity to raise objections to the proposed quantum of turnover fixed, especially as it was not reasonable. I do not think that even this objection is well founded to warrant any revision by me of the quantum. All the same, I have been taken through the assessment orders, and I have not been able to discover any infirmity therein. The Sales-tax Officer found, on a careful scrutiny, that the duplicate cash memo books produced before him, were fabricated. Blank originals had been removed from the cash memo books and number of carbon copies had been prepared under the pressure of one writing by placing carbon papers in between the several blank pages at the same time. This was a correct finding of fact. The books of account, were, thus, unsupported by cash memos, thereby preventing a cross check. There was no price control and the prices charged by the petitioners had admittedly been increased from time to time. It was not possible to get correct figures from the petitioners' record. In spite of this, the Sales-tax Officer did not deviate much from the returned figures. The learned counsel, even at this stage, was unable to show to how the assessments were unreasonable and how the petitioners were deprived of an opportunity of raising any valid objections. I am further informed that the dealers filed appeals and revisions against the assessments, which have been varied to the petitioners' advantage. The appellate or the revisional orders were not produced before me. In any case, the impugned orders are no longer effective. There is, thereforee, no cause for the petitioners' grievances. In these circumstances, the contentions of the learned counsel are without any foundations.
(12) I do not find any merit in these petitions and the same are dismissed. but without any order as to costs.