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G. Thangavel Nadar Vs. the Deputy Commercial Tax Officer - Court Judgment

LegalCrystal Citation
SubjectCommercial;Constitution
CourtChennai High Court
Decided On
Case NumberWrit Petition No. 1311 of 1960
Judge
Reported in[1963]14STC420(Mad)
AppellantG. Thangavel Nadar
RespondentThe Deputy Commercial Tax Officer
Appellant AdvocateT.V. Balakrishnan, Adv.
Respondent AdvocateS. Mohan, Adv. for ;Additional Government Pleader
DispositionSuit allowed
Cases ReferredIn Muthuvelappa Gounder v. Deputy Registrar of Co
Excerpt:
.....to take action under section 12(3) of the act can hardly be questioned. the only reason why the deputy commercial tax officer proceeded to impose the penalty was that the petitioner did not explain his failure to submit the return on the ground that the account books were with the department though that fact was in the forefront and the assessing authority was fully aware of the circumstance that the account books were with the department. that the assessee failed to submit return for earlier years or failed to register himself cannot give jurisdiction to the assessing authority to impose a penalty for the assessment year in question. it is true that the petitioner has failed to avail himself of the appropriate remedies under the act. the order imposing the penalty in this case was..........objected to the levy on the ground that all his account books had been taken away by the special deputy commercial tax officer, tanjore, on 21st april, 1960, and they were not available with him to enable him to make a return on or before 1st may, 1960, as the notice required him to do. nevertheless by the order dated 30th november, 1960, the deputy commercial tax officer made the assessment for the assessment year 1959-60 on the basis of the several accounts recovered from him at the time of the inspection by the special deputy commercial tax officer and further imposed a penalty of rs. 3,000. the assessee-petitioner submitted to the assessment on a turnover of rs. 2 lakhs; but in so far as the penalty was concerned his explanation that his failure to submit the return was purely.....
Judgment:
ORDER

Srinivasan, J.

1. This is a petition under Article 226 of the Constitution praying that this Court may call for the records of the Deputy Commercial Tax Officer dated 30th November, 1960, in assessment No. B. 4165/5960 and issue a writ of certiorari quashing that order. The petitioner was assessed to sales tax for the assessment year 1959-60 on a turnover of Rs. 2 lakhs in the order above impugned. By the same order the assessing authority levied a penalty of Rs. 3,000 under Section 12(3) of the Madras General Sales Tax Act. This order was made after the issue of a notice dated 31st October, 1960, to the petitioner proposing to levy the penalty for his failure to submit a return. The petitioner objected to the levy on the ground that all his account books had been taken away by the Special Deputy Commercial Tax Officer, Tanjore, on 21st April, 1960, and they were not available with him to enable him to make a return on or before 1st May, 1960, as the notice required him to do. Nevertheless by the order dated 30th November, 1960, the Deputy Commercial Tax Officer made the assessment for the assessment year 1959-60 on the basis of the several accounts recovered from him at the time of the inspection by the Special Deputy Commercial Tax Officer and further imposed a penalty of Rs. 3,000. The assessee-petitioner submitted to the assessment on a turnover of Rs. 2 lakhs; but in so far as the penalty was concerned his explanation that his failure to submit the return was purely accidental and not wilful since all the account books had been taken away by the authorities on 21st April, 1960, was not accepted. The attack upon this order is that the Deputy Commercial Tax Officer had no jurisdiction to levy a penalty as the petitioner had been prevented by the respondent himself from filing the return by reason of the seizure of the account books. It is claimed that this levy is unauthorised, that it is an illegal levy constituting an infringement of his fundamental rights and also is in violation of the principles of natural justice.

2. Section 12 of the Madras General Sales Tax Act, 1959, lays down the procedure to be followed by the assessing authority. It requires that the assessment on a dealer shall be on the basis of the prescribed return relating to his turnover submitted in the prescribed manner within the prescribed period. It further lays down that if no return is submitted as required, it is open to the assessing authority to assess the dealer to the best of his judgment. Sub-section (3) confers upon the assessing authority the power to impose a penalty in a case of failure to submit a return as required. In this case it is not denied that there was factually a failure to submit a return so that the jurisdiction of the assessing authority to take action under Section 12(3) of the Act can hardly be questioned. But the facts are somewhat peculiar, for, what happened is this: The Special Deputy Commercial Tax Officer (Detections) made a surprise visit to the place of business of the dealer on 21st April, 1960. 14 account books were seized. According to these account books the dealer had a turnover of very nearly Rs. 2 lakhs. Simultaneously a notice was issued to him calling upon him to submit a return on or before 1st May, 1960. It is not denied by the department that the account books continued to be in the possession of the department and that the dealer had no access to these account books in order to enable him to make a return. It is also not denied that the assessee had under the rules time till 1st May, 1960, for the submission of the return for the assessment year 1959-60. The Deputy Commercial Tax Officer in his order, while apparently conceding these facts, observed :

He had not also intimated the assessing authorities on or before 1st May, 1960, explaining the circumstances under which he could not send the return in Form A-1 for 1959-60 on or before 1st May, 1960, as required by rules. In the absence of any such things, the contention that he could not send the A-l return for 1959-60 on or before 1st May, 1960, as required by rules as the account books were with the department could not be accepted as but for the detection, the entire revenue would have been lost to the Government...

3. In the counter-affidavit filed on behalf of the department as also in the order imposing the penalty reliance has been placed upon the fact that the assessee had not filed any returns for the earlier years and has not registered himself as a dealer for these years, as circumstances which had led to evasion of tax. It is however conceded that the petitioner had time to file his return till 1st May, 1960. It is also conceded that the account books were with the department. The only reason why the Deputy Commercial Tax Officer proceeded to impose the penalty was that the petitioner did not explain his failure to submit the return on the ground that the account books were with the department though that fact was in the forefront and the assessing authority was fully aware of the circumstance that the account books were with the department.

4. It is clear that to ask an assessee to submit a return and at the same time taking away his books of account is to demand the impossible. It is unthinkable that the Deputy Commercial Tax Officer could proceed to penalise a person for not doing something, the doing of it being prevented by the officer's own action. In this view of the matter there is no doubt whatsoever that there has been a gross violation of the principles of natural justice. That the assessee failed to submit return for earlier years or failed to register himself cannot give jurisdiction to the assessing authority to impose a penalty for the assessment year in question.

5. It has further been contended by the department that since the petitioner had remedies open to him by way of appeal to the Appellate Assistant Commissioner and a further appeal to the Tribunal, this Court should not grant the writ, the more so because the petitioner has not explained why he did not pursue the remedies provided by the statute. It is true that the petitioner has failed to avail himself of the appropriate remedies under the Act. The order imposing the penalty in this case was made on 30th November, 1960. He immediately moved this Court, the writ petition being filed during the last week of December, 1960. It is true that normally the failure to resort to the appropriate remedies may be a bar but where this Court did not reject the petition on that ground at the stage of admission, I do not think it will be proper to rely upon that circumstance when the hearing of the petition clearly discloses that there has been a violation of the principles of natural justice. It is well accepted that the existence of an adequate alternative remedy is not always a bar to the issue of a writ. In Muthuvelappa Gounder v. Deputy Registrar of Co-operative Societies : (1960)2MLJ392 Jagadisan, J., observed that however convenient or expedient it may be to dismiss a writ petition before issuing a rule nisi on the ground of a subsisting alternative remedy, it may not always be just to do so at the final stage when the parties have incurred all the expenses and the Court has gone into the matter fully. I respectfully agree with this observation and hold that this is not a proper case where the writ petition should be dismissed on that ground.

6. For the reasons that I have set out, the petition will be allowed. The rule nisi is made absolute. There will however be no order as to costs.


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