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Western Indian State Motors Vs. the Board of Revenue and ors. - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtRajasthan High Court
Decided On
Case NumberD.B. Civil Writ Petition No. 123 of 1978
Judge
Reported in[1982]50STC89(Raj)
AppellantWestern Indian State Motors
RespondentThe Board of Revenue and ors.
Appellant Advocate V.K. Singhal and; B.K. Khetan, Advs.
Respondent Advocate S.M. Mehta, Adv.
DispositionPetition allowed
Cases ReferredNorthern India Caterers (India) Ltd. v. Lt. Governor of Delhi
Excerpt:
.....- this view was followed by the board in subsequent cases as well as would appear from commercial taxes officer, special circle ii, jaipur v. no such steps were taken till the final arguments and the board was perfectly justified in dismissing the special appeal on 31st july, 1974. it is also argued that even in the rectification application submitted by the assessing authority under section 17 of the act no such allegation was made that shri tunwal had been authorised and the board in accepting the application by its order dated 16th october, 1976, could not have exercised jurisdiction merely relying on indl. mehta further submitted that the powers of this court under article 226 are discretionary and if there was no failure of justice and no violation of the principles of natural..........case are that the petitioner-assessee was assessed under section 10 of the act by the commercial taxes officer, special circle i, jaipur, for the assessment year 1967-68. the said commercial taxes officer then after issuing a notice to show cause under section 16(1)(b) of the act and under section 11-b of the act and after receiving the written objections, by his order dated 20th august, 1971, inflicted rs. 22,653.34 as penalty under section 16(1)(b) and inflicted a further sum of rs. 6,686.78 as interest. the petitioner-assessee filed a revision in the board of revenue against the order of imposition of interest as no appeal was provided against this order and filed an appeal before the deputy commissioner (appeals), jaipur, against the order imposing penalty. a learned single member.....
Judgment:

N.M. Kasliwal, J.

1. This writ petition by M/s. Western Indian State Motors, Mirza Ismail Road, Jaipur (hereinafter referred to as 'the assessee'), is directed against the orders of the Board of Revenue dated 16th October, 1976, and 19th September, 1977, on applications under Section 17 of the Rajasthan Sales Tax Act, 1954 (hereinafter referred to as 'the Act').

2. Brief facts of the case are that the petitioner-assessee was assessed under Section 10 of the Act by the Commercial Taxes Officer, Special Circle I, Jaipur, for the assessment year 1967-68. The said Commercial Taxes Officer then after issuing a notice to show cause under Section 16(1)(b) of the Act and under Section 11-B of the Act and after receiving the written objections, by his order dated 20th August, 1971, inflicted Rs. 22,653.34 as penalty under Section 16(1)(b) and inflicted a further sum of Rs. 6,686.78 as interest. The petitioner-assessee filed a revision in the Board of Revenue against the order of imposition of interest as no appeal was provided against this order and filed an appeal before the Deputy Commissioner (Appeals), Jaipur, against the order imposing penalty. A learned single Member of the Board of Revenue allowed the revision by his judgment dated 30th March, 1973. It was held that the default in making payment before 5th March, 1968, was waived and rendered no benefit and accordingly the Commercial Taxes Officer was directed to pass a fresh order in accordance with the judgment. The Commercial Taxes Officer in accordance with the directions given by the Board of Revenue finally determined the amount of liability at Rs. 3,376.70. One Shri K. L. Tunwal, Assistant Commercial Taxes Officer, lodged a special appeal under Section 14(4A) of the Act, before the Division Bench of the Board, against the order of the single Member of the Board dated 30th March, 1973. This special appeal was registered as Appeal No. 105 of 1976 in the routine manner. The assessee when appeared before the Board, raised two preliminary objections before the Division Bench of the Board. Out of the two preliminary objections raised by the assessee, the Board accepted the second preliminary objection to the effect that the special appeal was presented in the Board by Shri K.L. Tunwal, Assistant Commercial Taxes Officer (Revisions), who was neither the assessing authority nor was authorised by the assessing authority to present the special appeal. The Board placed reliance on an earlier decision of the Board in State of Rajasthan v. Gemini Murti Kalakar 1973 RRD 608. The Board further held that in accordance with Rule 34 made applicable to the memorandum of special appeal under Rule 41A, the presentation should either be by the appellant or his pleader or his agent having authority in writing. In the present case, the learned Government Advocate could not show any authority of the assessing authority in favour of Shri Tunwal. As such the presentation of special appeal was not by a duly authorised person. It was further held that the provisions of Rule 34 were very clear on this point and a member of the staff of the assessing authority could not be authorised to present the memorandum of special appeal under Rule 34. In the result the special appeal was dismissed by their judgment dated 31st July, 1974. The Commercial Taxes Officer then submitted an application under Section 17 of the Act on 20th June, 1975, for rectification of the order dated 31st July, 1974. The only ground taken in this application was 'the case of Sanghi Oxygen Co. (Special Appeal No. 7/Jpr/72), the special appeal was filed on behalf of the appellant-assessing authority, by the Assistant Commercial Taxes Officer (Revisions), Ajmer, as was done in the present case. Presentation by an. unauthorised person was held to be an irregularity but following Shiv Narain v. Deputy Director (C), Mathura AIR 1959 All 487, the Board of Revenue held that since notices had gone to the opposite party, the improper presentation may be deemed to have been waived. This view was followed by the Board in subsequent cases as well as would appear from Commercial Taxes Officer, Special Circle II, Jaipur v. Indl. Chemicals and, Plastics 1974 RRD 407'. It was mentioned in this application that this judgment of the Board was not brought to the notice of the Honourable Members when this case of Western Indian State Motors was heard and decided and, therefore, it was requested that the order of the Honourable Board dated 31st July, 1974, be rectified and the appeal be restored and ordered to be heard on merits. The Board accepted the application under Section 17 and ordered that the appeal be restored to be heard on merits. In allowing the application, the Board placed reliance on Indl. Chemicals and Plastics' case 1974 RRD 407 and held that once the opposite party had been heard on the substance of the appeal, the objection had to be treated as waived. It further observed that before the disposal of this appeal on 31st July, 1974, Shri K.L. Tunwal had been duly empowered on 18th April, 1974. The Board further observed that it was obvious that this final dismissal was due to facts and the accepted law by the Board on the issue, arising out of the above earlier ruling of the Board not having been brought to the notice of the Division Bench. The assessee then submitted a rectification application on 6th December, 1976, in respect of the order of the Board of Revenue dated 16th October, 1976. It was contended that the Board of Revenue had already exercised the discretion in not condoning the irregularity vide its judgment dated 31st July, 1974, and thereafter the mistake could not be rectified under the provisions of Section 17 of the Act. Shri K.L. Tunwal was not authorised on 18th April, 1974, since there was no authority for presenting the special appeal and the observation that Shri K.L. Tunwal was duly empowered, was against fact and constituted a mistake apparent from the record. The Division Bench of the Board of Revenue was contrary and not accepted law by the Board. A number of cases, special appeals and revisions had been rejected on this legal ground and, therefore, the finding that it was the accepted position of law, should also be considered a mistake apparent on the record. The Board dismissed this application filed by the assessee by its judgment dated 19th September, 1977. The Board took the view that the order dated 16th October, 1976, did not call for further rectification. The stress of the applicant was on the point that there was nothing on the record to show that Shri K.L. Tunwal had been duly empowered on 18th April, 1974, as stated in the order. It was true that the copy of the order empowering Shri Tunwal was not on the file, but this could not be taken to mean that he was not so empowered. It was further observed that they found it hard to believe that the learned Member could have given a particular date, viz., 18th April, 1974, without some specific information. There was no affidavit by the applicant that Shri Tunwal was not empowered on that date and it will, therefore, be presumed that the statement made in the order was correct.

3. In the aforesaid circumstances the assessee has filed the present writ application and has prayed that the orders of the Board of Revenue dated 16th October, 1976, and 19th September, 1977, being without authority of law and beyond jurisdiction should be quashed and restore the order of the Board dated 31st July, 1974.

4. Mr. Singhal appearing on behalf of the petitioner has contended that the decision of the Board of Revenue in Gemini Murti Kalakar's case 1973 RRD 608 was in favour of the assessee. This was a decision of a Division Bench of the Board. Even if a different view was taken by a Division Bench of the Board in a later case reported in Indl. Chemicals and Plastics' case 1974 RRD 407, this could not be a ground for rectification under Section 17 of the Act. It is contended that in Indl. Chemicals and Plastics' case 1974 RRD 407, there is no reference of Gemini Murti Kalakar's case 1973 RRD 608 an earlier Division Bench decision of that very court and in case they wanted to take a different view, the case ought to have been referred to a larger Bench. It is pointed out that the Board itself had to constitute a larger Bench of three Members to consider this point again in Khandelwal Enterprises v. Commercial Taxes Officer, Ward I, Circle B, Jaipur 1978 RRD 151 which held that the agent must be authorised in writing and the provision has been inserted for protection of the appellant himself so that no unauthorised person can present the appeal on his behalf and spoil his case. Non-presentation of the appeal by a properly authorised person is of some consequence as it rendered the presentation defective. This defect was curable and must be cured as early as possible. The Board in the above case further observed that, 'however, while agreeing with the view taken by the learned referring Member, Shri D. C. Joseph, we feel it necessary to observe that the defect of presentation should be got cured before the case reaches the Bench for argument otherwise presentation of appeals by unauthorised persons would be on the increase and filing of authority at the time of argument would make a mockery of the provisions requiring authorisation in writing. We, therefore, answer the reference as under :

In the circumstances such as in the present case, where a memorandum of appeal has been presented by a person who was not authorised in writing so as to be regarded an agent within the meaning of Rule 2(b) of the Rajasthan Sales Tax Rules, and the presentation is accordingly not in accordance with the requirement of Rule 34 of the Rules, the defect is curable by allowing the person presenting the appeal to submit an authoriry at a subsequent date as soon as the defect is brought to his notice'.

pronounced.

5. Mr. Singhal also pointed out that a Division Bench of the Board in Commercial Taxes Officer, Special Circle I, Jaipur v. National Engineering Industries Ltd., Jaipur (Special Appeal No. 106/75/ST/Jaipur decided on 19th December, 1977) (1978) 11 ITR 399 has taken the view that the presentation of revision by the Government Advocate without filing any vakalatnama or letter of authority at the time of presentation or at any time subsequently in the course of proceedings was improper.

6. It is further submitted that rectification under Section 17 of the Act was permissible only upon the material based on record at the time when such application is moved. Clause (d) in Rule 60 was inserted on and from 18th April, 1974, and as such the assessing authority was wholly unauthorised to authorise any one before this date. The petitioner-assessee had raised objection at the first stage as soon as it appeared before the Board on a notice served on it. The mistake could have been rectified in the presentation by obtaining a written authority and praying for the condonation of delay. The assessing authority could have taken time for removing the defects and could have authorised Shri K.L. Tunwal, Assistant Commercial Taxes Officer, in writing to lodge special appeal under consideration. No such steps were taken till the final arguments and the Board was perfectly justified in dismissing the special appeal on 31st July, 1974. It is also argued that even in the rectification application submitted by the assessing authority under Section 17 of the Act no such allegation was made that Shri Tunwal had been authorised and the Board in accepting the application by its order dated 16th October, 1976, could not have exercised jurisdiction merely relying on Indl. Chemicals and Plastics' 'case 1974 RRD 407. Mr. Singhal contended that the scope of Section 17 of the Act is limited to correct any arithmetical or clerical mistakes or any error apparent on the face of the record arising or accruing from accidental slip or omission in an order. It does not ' permit a party to raise new arguments in the court to review its earlier order merely on the basis that a subsequent ruling of that court was not brought to the notice of the court when earlier order was passed. Reliance is placed on Master Construction Co. (P.) Ltd. v. State of Orissa : [1966]3SCR99 M. Haji Mohamed Ismail Sahib and Co. v. State of Madras [1970] 26 STC 73 (FB) V. P. Minocha, Income-tax Officer, Special Investigation Circle VII, Ahmedabad v. Income-tax Appellate Tribunal, Ahmedabad : [1977]106ITR691(Guj) Additional Commissioner of Income-tax, A.P. v. P.R.N.S. and Co. : [1977]109ITR574(AP) Commissioner of Income-tax, West Bengal I v. Simplex Concrete Piles (India) Put. Ltd. : [1978]112ITR812(Cal) T.S. Balaram, Income-tax Officer, Company Circle IV, Bombay v. Volkart Brothers : [1971]82ITR50(SC) Nilgiris Potato Growers Co-operative Marketing Society Ltd. v. Commissioner of Income-tax, Madras II : [1978]111ITR375(Mad) Commissioner of Income-tax, Bombay City I v. Tata Engineering and Locomotive Co. Ltd. : [1977]108ITR869(Bom) Tata Iron and Steel Co. Ltd. v. N.C. Upadhyaya : [1974]96ITR1(Bom) Harbans Lal Malhothra and Sons Private Limited v. Income-tax Officer, 'C' Ward, Comp. Dist. II, Calcutta : [1972]83ITR848(Cal) and Jaipur Finance and Dairy Product Pvt. Ltd., Pilani v. Commissioner of Income-tax, Jaipur .

7. Mr. Mehta, the learned counsel for the department, contended that under Section 17 of the Act, the mistake could be rectified within four years. The special appeal was submitted by Shri Tunwal on 31st October, 1973, under the directions of the assessing authority, vide letter No. CTO/Spl-I/71/2606 dated 26th October, 1973, authorising in writing to the Assistant, Commercial Taxes Officer (Revisions), i. e., Shri K. L. Tunwal. The aforesaid letter has been reproduced in the reply to the writ petition. It is thus submitted that though this letter could not be presented before the Board of Revenue, but this Honourable Court may take into consideration and, if that be so, Shri Tunwal was fully authorised to submit the special appeal on 31st October, 1973. It is further submitted that Sub-rule (d) had been added to Rule 60 of the Rajasthan Sales Tax Rules, vide Notification No. F. 2(19) FD/Gr. IV/74 dated 18th April, 1974, which is reproduced as below :

(d) An officer not below the rank of the Assistant Commercial Taxes Officer specially authorised by the Commissioner.

8. In pursuance of the said rule, the Commissioner, Commercial Taxes, Rajasthan, Jaipur, authorised the Assistant Commercial Taxes Officer (Revisions), Ajmer, vide his order No. F. 16(11) Tax/CCT/72 dated the 18th April, 1974, which is reproduced below:

In pursuance of Rule 60(d) of the Rajasthan Sales Tax Rules, 1955, I, Bhim Singh, Commissioner, Commercial Taxes, Rajasthan, Jaipur, hereby authorise the Assistant Commercial Taxes Officer (Revision), Ajmer, to appear before the Board of Revenue, Rajasthan, in any proceedings under the Rajasthan Sales Tax Act, 1954, or the Rules made thereunder as an agent of the assessing authority under the said Act.

Sd./(Bhim Singh)

Commissioner,

Commercial Taxes, Rajasthan,

Jaipur.

9. It is thus submitted that in view of the above general authorisation by designation it was felt that there was no necessity to mention particularly about the authorisation of Shri K.L. Tunwal in the rectification application and the letter of authority dated 26th October, 1973, could not be filed earlier. Mr. Mehta further submitted that the powers of this Court under Article 226 are discretionary and if there was no failure of justice and no violation of the principles of natural justice or violation of any law, rule or regulation, this Court should refuse to interfere in the order passed by the court. Mr. Mehta also brought the original record to show that the letter of authorisation dated 26th October, 1973, was authentic and this Court should now take into consideration the aforesaid letter of authorisation. Reliance is placed on Gadde Venkateswara Rao v. Government of Andhra Pradesh : [1966]2SCR172 Veerappa Pillai, Proprietor, Sathi Vilas Bus Service, Porayar v. Raman and Raman Ltd., Kumbakonam : [1952]1SCR583 A.M Allison v. B.L. Sen : (1957)ILLJ472SC Debi Ram Sharma v. High Court of Judicature for the State of Punjab and Gani Mohammed v. State Transport Appellate Tribunal [1976] WLN 174.

10. We have given our careful consideration to the arguments advanced by the learned counsel for both the parties. The first point for consideration is whether an application under Section 17 of the Act could lie against the order of the Board of Revenue dated 31st July, 1974. It is not in dispute that no letter of authorisation in favour of Shri K.L. Tunwal was filed or brought to the notice of the Board till the final arguments in the special appeal which was decided on 31st July, 1974. Even in the rectification application filed as late as 20th June, 1975, there was no mention of such letter of authorisation. The rectification was not sought on this ground at all. The Board had rejected the special appeal by upholding the preliminary objection raised by the assessee and had placed reliance on Gemini Murti Kalakar's case 1973 RRD 608, a decision of a Division Bench of that court. The rectification application was allowed merely on the basis of a subsequent ruling of the Board in Indl. Chemicals and Plastics' case 1974 RRD 407. Thus there -were two conflicting views of the Board of Revenue at the time when the rectification application was filed. Shri C.S. Gupta was one of the Members who had decided the special appeal on 31st July, 1974, and he was also a Member in the case reported in Indl. Chemicals and Plastics' case 1974 RRD 407 which was decided on 13th June, 1974. It cannot be said that a case decided on 13th June, 1974, could not be in the notice of Shri C.S. Gupta who was one of the Members while deciding the special appeal on 31st July, 1974. The Board still placed reliance on Gemini Murti Kalakar's case 1973 RRD 608 only and dismissed the appeal. It may also be important to note that a Full Bench of the Board of Revenue in Khandelwal Enterprises' case 1978 RRD 151 has subsequently taken the view that the defect of presentation should be got cured before the case reaches the Bench for argument; otherwise presentation of appeals by unauthorised persons would be on the increase and filing of authority at the time of argument would make a mockery of the provisions requiring authorisation in writing. The Board had also in National Engineering Industries Ltd., Jaipur's case (1978) 12 TR 399 held that the defect could be cured if the Government Advocate presented a vakalatnama subsequently in the course of the proceedings. Thus, according to the various decisions given by the Board itself, the question was not free from doubt and if the Board placed reliance on Gemini Murti Kalakar's case 1973 RRD 608 while passing the order dated 31st July, 1974, it cannot be said by any stretch of imagination that it committed any error apparent on the face of the record. The scope of Section 17 of the Act is a limited one like a review and has aptly been stated by his Lordship Krishna Iyer, J., in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi AIR 1980 SC 674 that a plea for review, unless the first judicial view is manifestly distorted, is like asking for the moon. A forensic defeat cannot be avenged by an invitation to have a second look, hopeful of discovery of flaws and reversal of result. The Board in our view had thus no jurisdiction to rectify its judgment dated 31st July, 1974, under the provisions of Section 17 of the Act on the ground of a subsequent decision of the Board in the facts and circumstances of this case. It need not detain us for long in holding that Sub-rule (d) added to Rule 60 by notification dated 18th April, 1974, and an order issued in pursuance to that rule could not authorise Shri K.L. Tunwal to submit the appeal on 31st October, 1973. This provision was added on 18th April, 1974, which authorised an officer not below the rank of the Assistant Commercial Taxes Officer specially authorised by the Commissioner, and an order was issued in pursuance to Rule 60(d) of the Rajasthan Sales Tax Rules, 1955, by the Commissioner on 18th April, 1974. Under this provision no authority could be given retrospectively and the presentation on 31st October, 1973, by Shri Tunwal could not be validated.

11. Now we shall deal with another submission made by Mr. Mehta in this regard. The learned counsel has placed reliance on a letter of authority dated 26th October, 1973. Mr. Singhal, the learned counsel for the assessee has seriously challenged the authenticity of this letter. Mr. Mehta brought the original record to convince us about the genuineness and the authenticity of this letter. On going through the original record, we could not find any doubt in the genuineness or authenticity of this letter. However, the question is whether we could take into consideration a fresh material while hearing a writ of certiorari. We have to only examine whether the lower authority had jurisdiction or committed a manifest error in the exercise of its jurisdiction while deciding the case on the material available with it. Admittedly this letter dated 26th ' October, 1973, was not brought to the notice of the learned Members of the Board of Revenue, nor such letter was taken as a ground even in the rectification application. In the absence of such material placed before the Board of Revenue it cannot be said that the Board committed any error of jurisdiction in passing the order dated 31st July, 1974. We cannot take into consideration a fresh material in order to hold that the lower authority committed an error of jurisdiction. This letter dated 26th October, 1973, has seen the light of the day for the first time in this Court in reply to the writ petition. In the absence of such a letter it cannot be said that the order of the Board passed on 31st July, 1974, suffers from any illegality. The cases relied upon by Mr. Mehta in this regard are beside the point and can render no help. If the application under Section 17, in the facts and circumstances of the case, was not maintainable and the order dated 31st July, 1974, which had become final, there is certainly a failure of justice and we are bound to quash the order dated 16th October, 1976, which, in our opinion, was clearly without jurisdiction and erroneous. As the order dated 16th October, 1976, is quashed, the order dated 19th September, 1977, automatically fails and is set aside.

12. In the result, we allow this writ petition, set aside the orders of the Board of Revenue dated 16th October, 1976, and 19th September, 1977, and restore its order dated 31st July, 1974. In the facts and circumstances of the case, the parties are left to bear their own costs.


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