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A.S. Narayana Vs. State of West Bengal and ors. - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtKolkata High Court
Decided On
Case NumberC.R. No. 1231(W) of 1973
Judge
Reported in[1973]32STC505(Cal)
AppellantA.S. Narayana
RespondentState of West Bengal and ors.
Appellant AdvocateA.P. Chatterjee and ;Roma Mukherjee, Advs.
Respondent AdvocateD. Gupta and ;G.N. Roy, Advs. and ;Adv.-General
Cases ReferredI.J. Rao and Ors. v. Bibhuti Bhusan Bag and Anr.
Excerpt:
- debiprosad pal, j.1. the validity of the constitution of the bureau of investigation (hereinafter referred to as the bureau) set up by a notification dated 3rd february, 1970, issued by the finance department (taxation), government of west bengal and the legality of the power of search and seizure exercised by some of the officers of the bureau under the provisions of the bengal finance (sales tax) act, 1941 (hereinafter referred to as the act), have been challenged in this petition.2. the facts which have given rise to the present dispute do not require an elaborate narration. the petitioner claims to be the proprietor of spare corporation and carries on business under the said name and style at 60, beg bagan row, calcutta. his business consists of the supplies of spare parts for heavy.....
Judgment:

Debiprosad Pal, J.

1. The validity of the constitution of the Bureau of Investigation (hereinafter referred to as the Bureau) set up by a notification dated 3rd February, 1970, issued by the Finance Department (Taxation), Government of West Bengal and the legality of the power of search and seizure exercised by some of the officers of the Bureau under the provisions of the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as the Act), have been challenged in this petition.

2. The facts which have given rise to the present dispute do not require an elaborate narration. The petitioner claims to be the proprietor of Spare Corporation and carries on business under the said name and style at 60, Beg Bagan Row, Calcutta. His business consists of the supplies of spare parts for heavy earthmoving equipments and machinery and automobiles. The petitioner is a registered dealer under the Act. It is stated that he had been carrying on his business since October, 1966 and had been submitting quarterly returns under the Act in the prescribed manner. Sri S.K. Chatterji, Commercial Tax Officercum-Investigating Officer of the Bureau, being respondent No. 4, by an order dated 3rd February, 1973, called upon the petitioner to produce all his books and papers for all unassessed periods. On 6th February, 1973, the petitioner appeared with the books of account before respondent No. 4, who noticed certain irregularities in the transactions recorded. Some books which were produced by the petitioner on that date were left at the office of respondent No. 4 for scrutiny. When the petitioner appeared on 13th February, 1973, Sri S.B. Ghatak, Inspector-cum-Investigator of the Bureau, seized the books of account left by the petitioner on the earlier date and a seizure receipt dated 13th February, 1973, was supplied to the petitioner. Thereafter, respondent No. 4 wrote a letter to the petitioner alleging that he was carrying on business from a clandestine place at 9, Lall Bazar Street, although the registration under the Act has been granted in respect of the place at 60, Beg Bagan Row. By the aforesaid letter the petitioner was requested to comply with certain requisition made in the said letter. The petitioner sent a reply on 9th April, 1973, the details of which are not necessary to be stated for the present purpose. As the books of account seized were not returned to the petitioner even after 21 days from the date of the seizure, the petitioner moved this application and obtained a rule nisi.

3. The learned counsel for the petitioner contends firstly, that the Bureau does not form any part of the organisation of the Commercial Tax Directorate which is under the administrative control of the Commissioner of Commercial Taxes. According to him, the constitution of the Bureau is not authorised by any statutory provision and by a mere notification issued by the Governor, the Bureau cannot be vested with any statutory power of levy and collection of tax under the Act. The learned counsel secondly submits that even assuming that the State Government has the power to constitute the Bureau by a notification, the officers of the Commercial Tax Directorate having been released from their respective posts in the said Directorate and having been deputed to serve the Bureau, have ceased to function as officers under the Act to assist the Commissioner of Commercial Taxes and, as such, none of the said officers, who have been so deputed have the competence and the jurisdiction to exercise any of the powers and duties under the Act. The learned counsel for the respondents submits that the State Government can in the exercise of its administrative power constitute the Bureau for facilitating the work of investigation in connection with evasion of sales tax. With regard to the second contention of the petitioner, the learned counsel submits that the officers of the Directorate, who are also functioning as officers of the Bureau, are still under the statutory control of the Commissioner of Commercial Taxes and still retain their statutory positions under the Act and have exercised their powers under the Act.

4. To examine the rival contentions of the parties it is necessary to trace the origin of the Bureau and to consider the various notifications under which the appointments of the officers have been made in the Bureau. Counsel for both the parties have placed before me the series of notifications relevant to the present controversy. The said notifications have now, with the consent of the parties, been placed on record. By a notification dated 3rd February, 1970, issued by the Governor of West Bengal, the Bureau in the Finance Department was constituted for the purpose of investigation of cases of evasion of sales tax as well as malpractices connected therewith. The composition of the Bureau will be as follows :

(i) A Special Officer who will have ex-officio status of Additional Commissioner of Commercial Taxes will work in close liaison with the Commissioner of Commercial Taxes.

(ii) A Superintendent of Police having jurisdiction over the entire territory of West Bengal including the city of Calcutta. He will work under the guidance of the Special Officer and the overall control of the Finance Department.

(iii) Such number of officers and staff as may be considered necessary and sanctioned by the Governor from time to time to assist the Special Officer and the Superintendent of Police in the discharge of their duties.

5. By Notification No. 4422-F. T./IB-l16/70-ST dated 7th August, 1970, it was announced that as the duties and functions to be performed by the officers of the Bureau will be more or less identical with those of the officers of the Commercial Tax Directorate, it had been decided by the Government that in the interest of smooth and efficient functioning of the Bureau, the officers and the staff of the Bureau may be drawn from the corresponding cadres of officers and staff under the Commercial Tax Directorate, unless direct recruitment is resorted to. The officers of the Bureau will include the Additional Commissioner of Commercial Taxes-cum-Special Officer and Commercial Tax Officer-cum-Investigating Officers and the staff will include Inspector-cum-Investigator, Head Clerk, U.D. Clerk, L.D. Clerk and typists of the Bureau. So far as the gazetted officers and the Inspectors of Commercial Taxes are concerned, Finance (Taxation) Department will continue to be the appointing authority in respect of such officers, while the Additional Commissioner-cum-Special Officer will be the appointing authority in respect of other nongazetted staff including Class IV staff. By a Notification No. 199-F.T. dated 15th January, 1971, the Bureau was vested with the additional duties of dealing with cases of evasion of taxes under the Taxes on Entry of Goods into Calcutta Metropolitan Area Act, 1970 and malpractices connected therewith.

6. By memo No. 775-F.T. dated 23rd February, 1970, the post of Additional Commissioner of Commercial Taxes-cum-Special Officer in the Bureau was created and by a notification of the same date, Sri Nikhilesh Chandra Biswas, Additional Commissioner of Commercial Taxes, West Bengal, was to officiate in the post of Special Officer and ex-officio Additional Commissioner of Commercial Taxes in the newly constituted Bureau for a period of six months with effect from the date on which he assumed charge. By memo No. 4025-F.T. dated 7th July, 1970, the Assistant Secretary to the Government of West Bengal, Finance Department (Taxation), writes to the Accountant-General, West Bengal, that the Governor has sanctioned the creation of a temporary gazetted post of Additional Commissioner of Commercial Taxes and Special Officer in the Bureau constituted by resolution No. 494-F.T. dated 3rd February, 1970, for a period up to 28th February, 1971. The said order also cancelled the department order No. 775-F.T. dated 23rd February, 1970, to which reference has been made earlier. On the same date, i. e., on 7th July, 1970, Sri Nikhilesh Chandra Biswas, Additional Commissioner of Commercial Taxes, West Bengal, was appointed to act as Additional Commissioner of Commercial Taxes and Special Officer in the Bureau under the Finance Department for a period of six months with effect from the date he actually assumed charge. The said notification being No. 4026- F.T. dated 7th July, 1970, cancelled the earlier Notification No. 776-F.T. dated 23rd February, 1970.

7. By a Notification No. 2294-F.T. dated 30th May, 1970, the Governor sanctioned the creation of the following temporary posts in the Bureau in the time scale of pay noted against the said posts with effect from the date on which the posts are actually filled up:

Name of the post No. of post Scale of pay

(1) Commercial Tax (1) Rs. 325-30-475-35-1000

cum-Investi- One (E. B. after 8th and

gating Officer 16th stages).

(2) Inspector-cum- (2) Rs. 200-10-400

Investigator Two (E. B. after 10th stage).

8. By a Notification No. 2417-F.T. dated 5th June, 1970, the Governor appointed Sri Suboth Chatterji, Commercial Tax Officer, Grade-I, as Commercial Tax Officer-cum-Investigating Officer in the Bureau and posted him there with effect from the date he assumed charge until further order. Similarly, by a Notification No. 1450-F.T. dated 23rd April, 1971, Sri Sanjib Bhusan Ghatak, a permanent Inspector of Commercial Taxes was appointed as Inspector-cum-Investigator in the Bureau and was posted there with effect from the date he assumed charge until further order. He was allowed to retain lien in the post of Inspector of Commercial Taxes.

9. I have set out in detail the relevant notifications which have a bearing upon the present controversy. On an examination of the relevant notifications particularly the one dated 3rd February, 1970 and 7th August, 1970, I am of the view that the Bureau has been set up not under the Act nor under any other statutory provisions. It has been constituted under a notification dated 3rd February, 1970, by the Governor in his executive capacity. It has no statutory authority. Its constitution is what the State Government may for the time being decide. The mere fact that there is no law enacted constituting the Bureau and defining its powers does not, by itself, affect the validity of the Bureau. The State Government may in the exercise of its executive power, which is under Article 162 of the Constitution coextensive with its legislative power, set up a Bureau to deal with matters which are within the competence of the State Legislature to legislate. Executive power of a modern State is not capable of any precise definition. 'Ordinarily the executive power connotes the residue of governmental functions that remain after legislative and judicial functions are taken away' : Ramjawaya Kaput v. State of Punjab A.I.R. 1955 S.C. 549. It is neither necessary nor possible to give an exhaustive enumeration of the kinds and categories of executive functions of a modern State, which may comprise both the determination of the policy as well as its execution. In other words, the State in the exercise of its executive power is charged with the duty and the responsibility of carrying on or supervision of the general administration of the State. So long as the executive Government does not go against the provisions of the Constitution or of any law, the width and amplitude of its executive power need not be circumscribed by any specific legislation sanctioning a particular course of conduct. It is not necessary that the executive Government must obtain prior legislative sanction before the exercise of its executive power : Ramjawaya Kapur v. State of Punjab A.I.R.1955 S.C. 549. In my view, the constitution of the Bureau by the State Government is not as such invalid. Reliance may be placed in support of this view upon an unreported decision of Sabyasachi Mukharji, J., in the case of S. N. Jaki and Anr. v. Investigation Officer and Ors. (Matter No. 236 of 1971).

10. It is now necessary to examine the second contention raised by the learned counsel for the petitioner. It is submitted that respondents Nos. 3 to 5 having been appointed officers of the Bureau had ceased to function as officers under the Act and as such cannot exercise any of the duties and powers under the Act. Consequently, the seizure made on 13th February, 1973, by respondent No. 5 is illegal and without jurisdiction. In the unreported case of S.N. Jaki v. Investigation Officer and Ors. (Matter No. 236 of 1971), it appears that this contention in its present form was not canvassed before Sabyasachi Mukharji, J. It was not, therefore, necessary in that case to examine the validity of the above contention.

11. An examination of this question requires an analysis of the relevant provisions of the Act under which different authorities are charged with the administration of the Act. For carrying out the purposes of the Act the State Government is authorised to appoint a person to be the Commissioner of Commercial Taxes together with such other persons to assist him as the State Government may think fit. The area or areas over which such persons are to exercise jurisdiction are to be specified by the State Government. The persons appointed under Sub-section (1) of Section 3 shall exercise such power as may be conferred and perform such duties as may be required, by or under the Act. The Assistant Commissioner, Commercial Tax Officer and Inspector have been appointed under Section 3(1) of the Act to assist the Commissioner. Under Section 2(a) of the Act 'Commissioner' means the Commissioner of Commercial Taxes appointed under Section 3(1) of the Act. An 'Assistant Commissioner' under Rule 2(c) of the Bengal Sales Tax Rules (hereinafter referred to as the Rules) means the person appointed by that designation by the State Government under Section 3 to assist the Commissioner. 'Commercial Tax Officer' under Rule 2(f) means the person appointed by that designation by the State Government under Section 3 to assist the Commissioner. 'Inspector' according to Sub-rule (ff) of Rule 2 means the person appointed by that designation by the State Government under Section 3 to assist the Commissioner. Under Section 15 of the Act, the Commissioner may by order in writing delegate any of his powers under the Act except those under Section 22(2) to any person appointed under Section 3(1) to assist him. Under.Section 15 read with Rule 71 of the Rules, the Commissioner by an order dated 22nd July, 1972, had delegated the power under the various sections, of the Act to the specified authorities appointed to assist him. The power to inspect all documents and registers and to enter and search any place of business of a dealer and to seize account books and registers under Section 14(3) of the Act have been delegated to the Assistant Commissioner, Commercial Tax Officer and Inspector Subject to the condition that the power so delegated shall be exercised only within the respective jurisdiction of the officers concerned. Section 3(2A) gives the Commissioner the statutory power of administrative control over the officers appointed to assist him. The Commissioner under the aforesaid section may transfer any case or matter from any person appointed to assist him to any other person so appointed whether such other person has jurisdiction over the area to which the case or matter relates or not, provided he is otherwise competent to deal with such case or matter in exercise or the performance of the powers or duties conferred upon him.

12. The above analysis of the different provisions of the Act shows that a person appointed under Section 3(1) of the Act in order to discharge his statutory powers and duties under the Act must satisfy the following conditions:

(a) Such a person must be under the statutory control of the Commissioner who is vested with all the powers under the Act.

(b) Such a person being subordinate to the Commissioner in his administrative jurisdiction is to assist him in respect of the powers which are delegated to him under Section 15 of the Act read with Rule 71 of the Rules.

(c) The area over which such a person is to exercise his jurisdiction is specified by the State Government but the power that he will exercise can only be conferred by the Act and the duties which he is to perform are to be required by the Act.

(d) If a person does not remain as an officer of the Commercial Tax Directorate which is under the administrative control of the Commissioner under the Act and is appointed in some other post, he ceases to be a statutory authority competent to exercise any of the duties and powers under the Act.

13. The Additional Commissioner of Commercial Taxes is appointed by the State Government under Section 3A of the Act. Under Sub-section (2) of Section 3A, an Additional Commissioner shall have such of the powers and shall be entitled to exercise such of the duties of the Commissioner as the State Government may, by notification in the Gazette, direct. The Additional Commissioner also under the law is Sub-ordinate to the administrative control of the Commissioner. He does not exercise all the powers of the Commissioner. He can exercise only such powers as the State Government by notification may direct him to exercise. It is only in respect of such powers and duties which have been conferred upon him under Section 3A(2) that reference to the Commissioner shall be deemed to include reference to an Additional Commissioner. It is by a fiction, that for certain purposes reference to the Commissioner may include reference to an Additional Commissioner. The Additional Commissioner is, therefore, not equated with the Commissioner for all purposes under the Act. The Commissioner still retains under Section 3A(4) of the Act the administrative control over the Additional Commissioners, who are subordinate to him in the hierarchy of the administrative setup. The Commissioner has been given the power to transfer or withdraw to himself any case or matter with which an Additional Commissioner is competent to deal. He has also the power to transfer any such case or matter from one Additional Commissioner competent to deal with the same to another Additional Commissioner so competent. A review of these provisions bears ample testimony to the overall administrative power of superintendence of the Commissioner over all the statutory authorities appointed to assist him including the Additional Commissioner.

14. It is in the background of this hierarchy of authorities created under the Act one has to examine whether respondents Nos. 3, 4 and 5 can be considered to be the persons competent to assist the Commissioner under the Act and to discharge their statutory duties under the Act after they have been posted in the Bureau. It appears that Sri S.K. Chatterji before his appointment in the Bureau was functioning as a Commercial Tax Officer, Grade-I and was posted to Taltalla Charge. By the notification dated 5th June, 1970, the Governor appointed him as Commercial Tax Officer-cum-Investigating Officer in the Bureau and posted him there with effect from the date he assumed charge until further order. The post of Commercial Tax Officer-cum-Investigating Officer was a new post created by the notification dated 30th May, 1970, in the Bureau. It was a temporary post which continued to exist by notifications issued from time to time. In the copy which has been forwarded to the Accountant-General, West Bengal, it is pointed out that he had been appointed against the post created by the notification dated 30th May, 1970. It is also stated that he will draw his pay and other allowances drawn by him as Commercial Tax Officer, Grade-I. In the copy forwarded to the Commissioner, it is stated that, necessary steps for releasing the officer may be taken at an early date. A copy of the order had also been forwarded to Sri N.C. Biswas, Special Officer in the Bureau, for information. Similar orders were also issued regarding the appointment of Sri S.B. Ghatak, permanent Inspector of Commercial Taxes, as Inspector-cum-lnvestigator in the Bureau. In the notification dated 23rd April, 1971, it is stated that he will retain a lien in the post of Inspector of Commercial Taxes. It is also stated that he has been appointed against the post created by the notification dated 30th May, 1970 and has retained the same by the said notification dated 4th February, 1971. The notification dated 30th May, 1970, creates the temporary post of Inspector-cum lnvestigator in the Bureau in the Finance Department. In a copy forwarded to the Commissioner the Commissioner has been requested to take necessary steps for releasing him at an early date under intimation to the Deputy Secretary, Finance (Taxation) Department, Government of West Bengal.

15. In the light of these notifications by which Sri S.K. Chatterji and Sri S.B. Ghatak have been appointed in the Bureau, it is necessary to examine whether these officers continue to hold the posts of Commercial Tax Officer and Inspector respectively and are competent to discharge their statutory duties and powers under the Act. It appears that Sri S.K. Chatterji has been released from the post of Commercial Tax Officer, Grade-I and has been appointed in the new post as Commercial Tax Officer-cum-Invest'igating Officer under the Bureau. Sri S. B. Ghatak has also been released from his office of Inspector of Commercial Taxes and has been appointed as Inspector-cum-Investigator in the Bureau. Sri S.B. Ghatak is to retain his lien in the post of Inspector of Commercial Taxes. The word 'lien' under Rule 2(23) of the West Bengal Service Rules means the title of a Government servant to hold the sub-stantive post either immediately or on the termination of a period or periods of business, a permanent post, including a tenure post to which he has been appointed substantively. Under Rule 20(2) of the said Service Rules, the lien of a Government servant on a permanent post, which he holds substantively may be suspended if he is transferred, whether in a substantive or officiating capacity to a post in another cadre and there is reason to believe that he will remain absent from the post on which he holds lien for a period of not less than three year?. The question of making such a provision for lien would not have arisen if he still remains as an Inspector of Commercial Taxes in the Commercial Tax Directorate under the statutory control of the Commissioner. As he has now been transferred to a post in another cadre and in a different organisation, viz., the Bureau, which does not form part of the Commercial Tax Directorate, provision has to be made for the retention of his lien in the office of the Inspector of Commercial Taxes, which he was holding prior to his appointment. If Sri S.K. Chatterji and Sri S.B. Ghatak were holding the posts of Commercial Tax Officer and Inspector respectively in the Commercial Tax Directorate and were entrusted with the additional work of an Investigating Officer or an Investigator under the Bureau there could not have been any question of instructing the Commissioner to release them from their respective posts. In fact, the notification dated 30th May, 1970, makes it clear that the posts of Commercial Tax Officer-cum-Investigating Officer and Inspector-cum-Investigator are new posts created not in the Commercial Tax Directorate, but in the Bureau in the Finance Department. It is in this context that one can understand why a note has to be forwarded to the Accountant-General, West Bengal, that while holding the new posts Sri S.K. Chatterji and Sri S.B. Ghatak will draw their pay and other allowances drawn by them as Commercial Tax Officer and as Inspector of Commercial Taxes respectively. If they were still holding the posts as Commercial Tax Officer and Inspector of Commercial Taxes in the Commercial Tax Directorate, I find no reason why such a provision was necessary for the drawing of pay and other allowances in the same way as they were drawing formerly as Commercial Tax Officer or as Inspector of Commercial Taxes. The submission of the learned counsel for the respondents that these officers continue to remain as Commercial Tax Officer and Inspector under the Act in the context of the foregoing analysis cannot be accepted. If Sri S.K. Chatterji and Sri S.B. Ghatak were holding the posts of Commercial Tax Officer and Inspector of Commercial Taxes, they could not be again appointed as Commercial Tax Officer-cum-Investigating Officer and Inspector-cumInvestigator. The learned counsel for the respondents contended that their appointment as Commercial Tax Officer or Inspector was merely descriptive in character. I am unable to accept this contention. The posts which have been created in the Bureau are designated as Commercial Tax Officer-cum-Investigating Officer and Inspector cum-Investigator by the relevant notifications. They have been appointed to the said new posts under the Bureau. These officers under the Bureau are to assist the Special Officer and the Superintendent of Police in the discharge of their duties. They are not under the administrative control of the Commissioner, nor are they to assist the Commissioner in the performance of their statutory duties and powers. The constitution of the Bureau also shows that the officers of the staff of the Bureau may be drawn from the corresponding cadre of officers of the staff under the Commercial Tax Directorate unless direct recruitment is resorted to. In the case of gazetted officers and Inspector of Commercial Taxes, the Finance (Taxation) Department will continue to be the appointing authority. It appears, therefore, that the officers of the staff of the Bureau, although may be drawn from the corresponding cadre of officers of the staff of the Commercial Tax Directorate, are appointed under the Bureau, Sri S.K. Chatterji and Sri S.B. Ghatak having been released from the posts of the Commercial Tax Officer and Inspector respectively of the Commercial Tax Directorate do not in my view remain as Commercial Tax Officer and Inspector who are appointed by that designation by the State Government under Section 3 to assist the Commissioner. They have now been appointed to the posts of Commercial Tax Officer-cum-Investigating Officer and Inspector-cum-Investigator under the Bureau and although they may be described as Commercial Tax Officer and Inspector respectively, they have ceased to be such officers of that designation under the Act and as such are incompetent, to exercise any power and perform any duty as are required by the Act under Section 3(2).

16. I shall now examine the appointment of Sri N.C. Biswas, respondent No. 3. By a memo No. 775-F.T. dated 23rd February, 1970, a temporary gazetted post of Additional Commissioner of Commercial Taxes-cum-Special Officer in the Bureau was created and by an order dated 23rd February, 1970, the Governor appointed Sri N.C. Biswas, Additional Commissioner of Commercial Taxes, to officiate in the post of Special Officer and exofficio Additional Commissioner of Commercial Taxes in the newly constituted Bureau for a period of six months with effect from the date he assumed charge. By a subsequent notification dated 7th July, 1970, the sanction of the said post was extended and by another notification of the same date, Sri N.C. Biswas was to act as Additional Commissioner of Commercial Taxes-cum-Special Officer in the Bureau. The reasons which I have shown in the case of Sri S.K. Chatterji and Sri S.B. Ghatak will equally apply to the case of Sri N.C. Biswas. He is now to officiate in the post of Special Officer and exofficio Additional Commissioner of Commercial Taxes. Howsoever, he is described as an Additional Commissioner of Commercial Taxes in the Bureau, he is released from his post of Additional Commissioner of Commercial Taxes to which he was appointed under Section 3 A of the Act. He is now to officiate in the new post under the Bureau which, as already held by me, does not form part of the Commercial Tax Directorate. He is now the Special Officer and ex-officio Additional Commissioner under the Bureau and he is to work in close liaison with the Commissioner. He, no doubt, will continue to draw his own grade as he was drawing as an Additional Commissioner, but he is no longer holding the said post of Additional Commissioner under the Act. He will hold the post of the Special Officer and ex-officio Additional Commissioner created in the Bureau.

17. On a careful consideration, I have come to the view that Sri N.C. Biswas, Sri S.K. Chatterji and Sri S.B. Ghatak although recruited from the Commercial Tax Directorate, by their appointments in the Bureau consequent on their release from the Directorate, no longer remain as officers under the Act and howsoever they are described in the administrative setup of the Bureau they no longer remain as the authorities competent to discharge their statutory duties and powers under the Act. The seizure of the books of account made on 13th February, 1973, by Sri S.B. Ghatak purported to be under Section 14(3) of the Act is illegal and without jurisdiction.

18. The learned counsel for the petitioner next contended that even assuming the seizure has been lawfully made, under Rule 70 of the Rules the books of accounts cannot be retained beyond 21 days without the written sanction of the Assistant Commissioner. In the present case, he submits that there has been no such sanction either by the Assistant Commissioner or by the Commissioner as required under the Rules. He further submits that even if there has been any such sanction, it was never communicated to the petitioner and as such there is no such order of sanction in the eye of law. The learned counsel for the respondents stated that respondent No. 3 has granted the sanction on 27th February, 1973, for the retention of the books up to 30th June, 1973 and by another order dated 21st May, 1973, sanctioned the further retention of the books up to 31st December, 1973. He contends that such a sanction being an administrative act, requires no communication to the petitioner.

19. In the present case, the books having been seized on 13th February, 1973, admittedly, 21 days have expired before the petitioner moved this court on 17th May, 1973. Under Rule 70 of the Rules, if an Inspector or a Commercial Tax Officer seizes any books of accounts or documents under Section 14, he shall not retain them beyond 21 days without the written sanction of the Assistant Commissioner. No Inspecting Officer shall retain such books for more than 42 days without the sanction of the Commissioner. If the Commissioner grants any such sanction, under Section 20(3), an aggrieved person may make an application for revision of the said order before the Board of Revenue. Before any order is passed by the Board of Revenue likely to affect the petitioner adversely, it will give a reasonable opportunity of being heard to such person under Section 20(5) of the Act. The Board before rejecting any application for revision shall record reasons for such rejection under the proviso to Section 20(3). I am unable to accept the contention raised by the learned counsel for the respondents that such an order of the Commissioner cannot be the subjectmatter of a revision under Section 20(3) of the Act. The Commissioner if he has to accord sanction to the retention of the books beyond the statutory period can do so only by an order to be passed by him and not otherwise. Under Section 20(3) of the Act, the Board may of its own motion or upon an application revise any assessment made or order passed by the Commissioner under the Act or the Rules. An order of sanction under Rule 70 made by the Commissioner is an order made under the Rules and can be revised by the Board either suo motu or on an application by the aggrieved person. The period of making an application for revision is 60 days from the date of the order under Rule 80(2) of the Rules. If, therefore, an order of sanction is made by the Commissioner and it is not communicated to the person affected by it he will be deprived of a statutory remedy available to him under the Act.

20. The contention of the counsel for the petitioner that an order of sanction made by the Commissioner in order to be an effective order must be communicated to the party who is affected by the order has considerable force and should be accepted. It is now well-settled that where an order is made by a statutory authority, if a party is to be affected by that order, it must be communicated to him and in the absence of such communication such an order cannot be said to be a valid order having the effect of prejudicially affecting the rights of the party : Bachhittar Singh v. State of Punjab and Anr. A.I.R. 1963 S.C 395. The reason why such an order is to be communicated to the person affected by it is until the order is so communicated, it would be open to the authority making the order to consider the matter over and over again and such an order cannot be regarded as anything more than provisional in character. The learned counsel for the respondents relied upon the decision of the Supreme Court in the case of Bidya Deb Burma v. District Magistrate, Tripura A.I.R. 1969 S.C. 323, in support of the contention that such an order according sanction is merely an administrative approval by the State Government and need not be communicated. In my view, the said decision is hardly of any assistance in the present case. The aforesaid decision rested upon the interpretation of Section 3(3) of the Preventive Detention Act, 1950. Under the said section, if any order of detention is made by an officer, he shall forthwith report the fact to the State Government together with the grournds on which the order has been made and such other particulars as, in his opinion, have a bearing on the matter and no such order made under the said Act shall remain in force for more than 12 days after making thereof unless in the meantime it has been approved by the State Government. The Supreme Court pointed out that the scheme of the Preventive Detention Act is merely to approve the original detention by the District Magistrate and the continued detention after 12 days is not under any fresh order but. the same old order with the added approval and what the detenu can question, if he be so minded, is the original detention and not the approval thereof. This decision, in my view, is of little assistance in the present case because the provisions of the Preventive Detention Act are not in pari materia with those of the Act. Under the Preventive Detention Act, the detenu has a right to question the original detention and the approval of the original detention is not considered to be a fresh order. In the present case, the sanction granted by the Commissioner for the retention of the books after 21 days is in the nature of an independent decision which has been arrived at on a consideration of all relevant facts. The sanction of the Commissioner under Rule 70 is a fresh order against which a revision lies before the Board of Revenue under Section 20(3) of the Act. Reliance may be placed in this connection upon an unreported decision of the Division Bench in the case of Commissioner of Income-tax, West Bengal v. Mahabir Prosad Poddar (Appeal from Original Order No. 147 of 1970). The Division Bench in the said case considered the question as to whether an approval granted by the Commissioner of Income-tax under Section 132(8) of the Income-tax Act, 1961, for the retention of the books seized under the said Act beyond the statutory period of 180 days must be communicated to the party who is affected by such order. The Division Bench held that where an order has the effect of depriving a person of his right to property or otherwise affecting him prejudicially, such an order to be effective and valid must be communicated to the party, whose rights are affected and who is otherwise prejudiced by the order. Reference in that case also was made to another unreported Division Bench judgment in the case of I.J. Rao and Ors. v. Bibhuti Bhusan Bag and Anr. (Appeal No. 29 of 1969 from Matter No. 257 of 1967) In I. J. Rao's case, the question arose as to whether an order of extension of the retention of the goods seized under Section 110 of the Customs Act, 1962, beyond the statutory period was to be communicated to the aggrieved party. The Division Bench upheld the judgment of Ghose, J., holding, inter alia, that until such an order of extension was communicated it was not an effective order against the aggrieved party. Both the decisions referred to dealt with the question of approval or sanction to be accorded by a higher authority, viz., the Commissioner of Income-tax and the Collector of Customs, for retention of the books seized beyond the statutory period. In both the cases, there was no express provision far communicating the order to the aggrieved party. In both the cases, it has been held that such an order of approval until communicated cannot be said to be an effective order. In my view, the principle decided in both the cases applies with equal force to the present case, In my view, an order of sanction made by the Commissioner under Rule 70, until it is communicated to the aggrieved party does not become a valid and effective order. The Commissioner can sanction the retention of the books seized for such time as may be considered to be proper for the purposes of the Act. The aggrieved party is prejudicially affected by such an order and the statutory right of making an application for revision is rendered ineffective and illusory if such an order is not communicated to him. As, in the present case, the order of sanction granted by the Additional Commissioner was admittedly not communicated to the petitioner, the retention of the books after 21 days is without any valid order of sanction and as such is illegal and without jurisdiction.

21. It is not necessary for me to decide whether in according sanction under Rule 70, the Additional Commissioner has to proceed in a quasijudicial manner or not and whether in such a proceeding the aggrieved party should be given an opportunity of making representation. Although the learned counsel for the petitioner in the course of his argument raised such a contention, this point had not been specifically pleaded in the petition. Moreover, as I am of the view that the order of sanction to be an effective order must be communicated to the petitioner, it is not necessary to deal with this question in this application.

22. For the reasons stated above, I hold that (i) respondents Nos. 3, 4 and 5 have ceased to be the officers under the Act by reason of their appointments in the Bureau and the order of seizure made by respondent No. 5 on 13th February, 1973, is illegal and without jurisdiction, (ii) even assuming that the said officers are competent to exercise their powers and duties under the Act, as the books have been retained after 21 days from the date of seizure without a valid order of sanction by the Commissioner, the retention of the books after 21 days from the date of seizure has become illegal and without jurisdiction,

23. The rule is, therefore, made absolute. There will be a writ in the nature of mandamus commanding the respondents to return the seized books of accounts and records to the petitioner. There will be no order as to costs.


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