1. This application for the issue of a writ of certiorari, preferred under Article 226 of the Constitution, arises out of proceedings taken by the Deputy Commercial Tax Officer, Tirukoilur, to assess the petitioner to tax under the Madras General Sales Tax Act (IX of 1939) for the assessment year 1952-53.
2. The petitioner was a dealer in grocery with his principal place of business at Ulundurpet within the jurisdiction of the Deputy Commercial Tax Officer, Tirukoilur, in South Arcot District. The petitioner was first assessed to tax on a turnover of Rs. 86,441-14-9 for the assessment year 1952-1953. The assessment was completed by the Deputy Commercial Tax Officer, Tirukoilur on 10th February, 1954. Proceedings were subsequently taken under Rule 17 of the General Sales Tax Rules and on 20th March, 1956, the Deputy Commercial Tax Officer, Tirukoilur, revised' the assessment for 1952-1953, to include in the assessable turnover of the petitioner a further sum of Rs. 56,279, which represented the price of chillies sold by the petitioner in Dindigul Taluk of Madurai district.
3. The events that transpired between the two assessments and which led up to the assessment on 20th March, 1956, have to be set out.
4. On 29th October, 1954, the petitioner applied to the Deputy Controller of Exports for a licence to export chillies. In that application the petitioner stated that in 1952-1953 he had sold chillies of the value of Rs. 56,279 at his place of business Nagayakottai in Dindigul taluk, and he claimed further that he had grown these chillies on his lands. The petitioner enclosed certificates from the village officers to prove his contention, that he had about 50 acres of land under his cultivation in the relevant period. That application of the petitioner was eventually rejected by the Deputy Controller on 12th April, 1955.
5. The Deputy Commercial Tax Officer, Dindigul, took proceedings to assess the petitioner to sales tax on the admitted sale turnover of the chillies in 1952-1953. The Deputy Commercial Tax Officer held that there was no proof that the chillies the petitioner admittedly sold in the relevant assessment year were grown by him on lands in which he had an interest. On September, 1955, the Deputy Commercial Tax Officer, Dindigul, completed the assessment and levied a tax of Rs. 879-5-9 on the turnover of Rs. 56,279. The petitioner preferred an appeal to the Commercial Tax Officer, Madurai, against that order of assessment. The petitioner did not disclose in the memorandum of appeal that he had his place of business at Ulundurpet and that he had already been assessed to tax for 1952-1953 by the Deputy Commercial Tax Officer, Tirukoilur. The petitioner averred in the memorandum of appeal that illness had prevented him from placing the relevant material before the Deputy Commercial Tax Officer, Dindigul, to prove that the petitioner had produced on his lands the chillies that he sold in 1952-1953. The petitioner furnished details of his lands that he held and he produced with the memorandum of appeal four lease deeds. The petitioner also pleaded that he had no opportunity of participating in the enquiry that the Deputy Commercial Tax Officer, Dindigul, claimed that he had conducted at Nagayakottai, to which that assessing authority referred in the order of assessment dated 22nd September, 1955.
6. Pending disposal of that appeal, when the Departmental authorities in Madurai realised that the petitioner was already an assessee within the jurisdiction of the Deputy Commercial Tax Officer, Tirukoilur, the latter was informed of the proceedings that had been taken by the Deputy Commercial Tax Officer, Dindigul. The Deputy Commercial Tax Officer, Tirukoilur, issued a notice to the petitioner on 1st January, 1956, to show cause why the turnover of the sales of chillies should not be included and the assessment for 1952-1953 revised. Eventually, after the enquiry in which the petitioner did not participate, the Deputy Commercial Tax Officer, Tirukoilur, ordered a revision of the assessment for 1952-1953. Rs. 56,279 Was included and an additional tax of Rs. 879-5-9 was levied. That order of the Deputy Commercial Tax Officer, Tirukoilur, was dated 20th March, 1956, and it was the validity of that order the petitioner challenged in these proceedings.
7. The appeal preferred by the petitioner to the Commercial Tax Officer, Madurai, was allowed on nth April, 1956, and the order of the Deputy Commercial Tax Officer of Dindigul, dated 22nd September, 1955, was set aside on the sole ground, that that officer had no jurisdiction to assess the petitioner who had his principal place of business at Ulundurpet. The petitioner claimed that he was not aware of the termination of the appeal when he presented his application on 18th April, 1956 to this Court under Article 226 of the Constitution and obtained a rule nisi on 24th April, 1956.
8. The learned Counsel for the petitioner challenged the validity of the order dated March, 1956, mainly on two grounds ; (1) the petitioner had been denied a real and effective opportunity to show cause against the revision of assessment and the inclusion of the disputed turnover of Rs. 56,279 and (2) the revision of assessment was barred by the relevant rule prescribing the period of limitation.
9. It should be noted at the outset that the petitioner did not avail himself of the statutory remedy open to him to appeal to the Commercial Tax Officer, South Arcot, against the order, dated 20th March, 1956. One of the grounds set out in the affidavit of the petitioner was that there were two orders of assessment, one by the Deputy Commercial Tax Officer, Dindigul, and the other by the Deputy Commercial Tax Officer, Tirukoilur, on the same turnover of Rs. 56,279. But even after the disposal of the appeal on nth April, 1956, the petitioner did not appeal against the only order of assessment outstanding then, that of the Deputy Commercial Tax Officer, Tirukoilur, dated 20th March, 1956. Under normal circumstances that factor should have sufficed to decline to investigate the alleged invalidity of the impugned order preliminary to the grant of the discretionary relief of a writ of certiorari under Article 226 of the Constitution. We are not, however, resting our decision on that feature of the case. We are not convinced that there is any real substance in either of the contentions put forward on behalf of the petitioner.
10. What the petitioner urged in support of his claim, that he had been denied a real and effective opportunity by the Deputy Commercial Tax Officer, Tirukoilur, to show cause against the revision of assessment by the inclusion of the disputed turnover, was that the petitioner had not been furnished with copies of the relevant documents for which he applied to the Deputy Commercial Tax Officer, Tirukoilur.
11. It is true that even on 7th January, 1956, in response to the notice issued to him on 1st January, 1956, the petitioner wrote to the Deputy Commercial Tax Officer:
The petitioner requests that the Deputy Commercial Tax Officer may be pleased to grant certified copies of the records concerning the alleged transaction and showing how the said turnover was arrived at.
12. Subsequently on 29th January, 1956, the petitioner represented that he wanted copies of (1) the lease deeds that he himself had filed with the memorandum of appeal preferred to the Commercial Tax Officer, Madurai, (2) the certificate issued by the village officers as to the petitioner signed by the Revenue Inspector and Tahsildar, that the petitioner owned 5o acres and cultivated the same with chillies, and (3) the certificate issued by the Assistant Commercial Tax Officer, Dindigul, that the petitioner was an agriculturist producing chillies and therefore exempt from payment of sales tax for 1952-1953. It is equally true that copies of even these documents were never granted to the petitioner by the Deputy Commercial Tax Officer, Tirukoilur. We must confess that the basis of the refusal was not intelligible to us. Nonetheless the question remains, did the refusal of the copies amount to a denial of a real and effective opportunity to the petitioner to show cause against the proposed revision of assessment.
13. The controversy between the Department and the petitioner at that stage lay within a narrow compass. The petitioner admitted the sale of chillies. The turnover of these sales was not in dispute, as the petitioner's figures, disclosed in his application to the Deputy Controller for Exports, were accepted by the Department. The petitioner claimed that the turnover was exempt from taxation because he had produced the chillies on lands in which he had an interest either as owner or as lessee. Details of the lands he held he furnished in the memorandum of appeal he filed with the Commercial Tax Officer, Madurai. These records were all available, including the documents filed by the petitioner with his memorandum of appeal. The petitioner made no attempt to substantiate his claim, either with reference to these records or with reference to any other records in his possession including his books of account. He certainly knew wherefrom came the chillies which he admittedly sold in 1952-1953. The petitioner could have asked for an opportunity to examine the original records with the Deputy Commercial Tax Officer, Tirukoilur. In his turn the Deputy Commercial Tax Officer could, independently of such a request, have offered inspection of the records to thepetitionen Neither was done. When we had been taken through the correspondence that passed between the Deputy Commercial Tax Officer, Tirukoilur, and the petitioner, we were not convinced that it was really a case of denial of opportunity to the petitioner assessee ; it was more a case of the petitioner rnanouvering for position to raise debatable points in other proceedings. The petitioner had an opportunity. In fact more than one opportunity was furnished to him. All that was in evidence against him was set out in the further notice, dated 28th February, 1956, issued by the Deputy Commercial Tax Officer, Tirukoilur, though all the material set out in that notice had been gathered by the Deputy Commercial Tax Officer, Dindigul. The petitioner did not avail himself of the opportunity afforded by the Deputy Commercial Tax Officer, Tirukoilur, to establish the petitioner's claim, that the turnover in dispute was exempt from taxation. As the petitioner claimed an exemption it was for him to prove that he was entitled to it.
14. The plea of limitation has also little substance. Rule 17 (1) as it now stands provides for a three-year period of limitation, within which the assessing authority could complete the assessment of turnover which has escaped assessment. As Rule 17(1) stood first, it provided only for one year within which the escaped turnover could be assessed. The rule as amended on 7th February, 1948, provided for a two-year period. It was amended again on 11th June, 1953, when the period of limitation was enlarged to three years next succeeding that to which the tax related. The year of assessment with whichwe are concerned was 1952-1953. The escaped turnover was assessed by the order of the Deputy Commercial Tax Officer, Tirukoilur, on 20th March, 1956, that is, within three years of 31st March, 1953. The date of the original assessment, it should be remembered, was 10th February, 1954.
15. The contention of the learned Counsel for the petitioner was that the period of limitation should be only two years, which was all that Rule 17(1) provided for as it stood on 31st March, 1953, at the close of the relevant year of assessment 1952-1953. Had Rule 17(1) not been amended, the assessment of escaped turnover would have had to be completed before 31st March, 1955. But before the expiry of that period, the rule prescribing the period of limitation was amended, giving the assessing authority three years within which to assess any turnover that had escaped assessment. It was the three-year period that could apply to the case of the petitioner. His contention, that he had acquired a vested right to the two-year period of limitation, is untenable.
16. In Mohammad Hussain Nachiar v. Commissioner of Income-tax, Madras : (1956)2MLJ139 I pointed out that the principle to apply in such cases was the one laid down by another Division Bench of this Court in Ramanathan Chettiar v. Kandappa Gounder : AIR1951Mad314 where the learned Chief Justice observed:
It is well settled that the law of limitation being procedural law its provisions operate retrospectively in the sense that they apply to causes of action which arose before their enactment and that it is equally well established that if a right to sue had become barred by the provisions of the Act then in force on the date of coming into force of a later enactment, then such a barred right is not revived by the application of the new enactment.
17. In this case, before the right of the assessing authority was barred, the period of limitation prescribed by law Was enlarged, and it was the amended law that determined the liability of the petitioner. As we pointed out earlier, before the two-year period of limitation expired on 31st March, 1955, the rule was amended on nth June, 1953, providing a three-year period of limitation. The learned Counsel for the petitioner referred to the decision of Ramaswami, J., in East Asiatic Co. v. State A.I.R. 1956 Mad. 168 a decision rendered on 5th May, 1954, that is before the decision in. Muhammad Hussain Nachiar v. C.I.T. Madras : (1956)2MLJ139 . The attention of the learned Judge does not appear to have been drawn to the earlier decision in Ramanathan Chettiar's case : AIR1951Mad314 where as we pointed out, the learned Chief Justice referred to the principles of law as a well settled one. With all respect of Ramaswami, J., we are Unable to accept as correct the basis of his conclusion on this point:
But the right which had accrued to the assessee, namely, that the escaped assessment of tax cannot be reopened beyond the period of one year cannot be described as a matter relating to procedure only and it was a matter which was more than one relating to procedure, that is to say, it touched a right in existence.
18. In Ramanathan Ckettiar's case : AIR1951Mad314 the learned Chief Justice pointed that it was well settled that the law of limitation was procedural law. It should, however, be noted that in East Asiatic Co v. State A.I.R. 1956 Mad. 168 the relevant assessment years were 1945-1946 and 1946-1947; the notices issued to him under Rule 17 were dated 24th February, 1950, and were received by the assessee on 4th March, 1950; the order of revision was dated 31st March, 1950.
19. Since neither of the contentions put forward by the learned Counsel for the petitioner commends itself to us, we direct that the rule be discharged. There will, however, be no order as to costs.