JUDGMENT

Syed Shah Mohammed Quadri, J.-The State of Uttar Pradesh and the Sales Tax Officer (referred to in this judgment as, the State ) are in appeal against the common judgment of a Division Bench of the High Court of Judicature at Allahabad in Writ Petition No. 115 of 1995 Union of India & Anr. vs. State of U.P. & Anr. and batch dated September 1, 1998*.

2. The State, being of the opinion that the second respondent (The Manager, Department of Telecommunications, of the first respondent - hereinafter collectively referred to as the DoT ) failed to file return of the turnover of the rentals collected from the subscribers for the transfer of right to use the telephone system during the year 1988, under the provisions of the Uttar Pradesh Trade Tax Act, 1948 (for short, the U.P. Act ), called upon the DoT to file return therefor. However, no return was filed by the DoT. The State assessed the tax payable by the DoT in exercise of the power conferred under sub-section (3) of Section 7 of the U.P. Act. The DoT challenged the validity of the orders of assessment in the writ petitions before the High Court on various grounds. The State pleaded justification for passing the order of