Commissioner Of Sales Tax, U. P. , Lucknow vs Parson Tools And Plants, Kanpur

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1975 Supreme(SC) 86

SUPREME COURT OF INDIA
Y.V. CHANDRACHUD, R.S. SARKARIA AND A.C. GUPTA, JJ.
The Commissioner of Sales Tax, U.P., Lucknow, Appellant
Versus
M/s. Parson Tools and Plants, Kanpur, Respondent.
Civil Appeals Nos. 1458-1459 of 1970, D/- 27-2-1975.
Advocates appeared
Mr. N. D. Karkhanis, Sr. Advocate (Mr. O. P. Rana, Advocate with him), for Appellant.

Advocates:
M.D.Karkhanis, O.P.RANA

Headnote:
Limitation Act - Section 14 (2) - U. P. Sales Tax Act, 1948 - U. P. Sales Tax Rules - Rule 68 (6) - Whether under circumstances of case Section 14 of Limitation Act extended period for filing of revisions by time during which restoration applications remained pending as being prosecuted bona fide - Assessee filed appeals against those orders before Appellate Authority- On May 10 1963 when appeals came up for hearing assessee was absent- appeals were therefore dismissed in default by virtue of Rule 68 (5) of U- P- Sales-tax Rules- Sub-rule (6) of Rule 68 provided for setting aside such dismissal and re-admission of appeal - On same day assessee made two applications in accordance with Sub-rule (6) for setting aside dismissal - During pendency of those applications Sub-rule (5) of Rule 68 was declared ultra vires rulemaking authority of High Court who further held that Appellate Authority could not dismiss an appeal in default but was bound to decide it on merits even though appellant be absent - Held, It is true of course that courts will lean heavily against any construction of a statute which would be manifestly fair- But they have no power to amend or supplement language of a statute merely because in one view of matter a subject feels himself entitled to a larger decree of say in making of a decision than a statute accords him Still less is it functioning of courts to form first a judgment on fairness of an Act of Parliament and then to amend or supplement it with new provisions so as to make it conform to that judgment - For all reasons aforesaid - Court are of opinion that object scheme and language of Section 10 of Sales-tax Act do not permit invocation of S.14 (2) of Limitation Act either in terms or in principle for excluding time spent in prosecuting proceedings for setting aside - Appeal allowed

Judgement Key Points

Certainly. Based on the provided legal document, here are the key points:

The core legal question addressed is whether Section 14(2) of the Limitation Act can be applied, either explicitly or in principle, to exclude the period during which proceedings for setting aside an appeal dismissal are pending, from the limitation period for filing a revision under the relevant tax statute (!) (!) .
The case involved proceedings where appeals were dismissed in default due to the appellant’s absence, but applications were subsequently made under a specific rule to set aside those dismissals. During the pendency of these applications, a legal ruling declared certain procedural sub-rules ultra vires, affecting the appellate authority's powers (!) .
The issue was whether the time spent in prosecuting applications to restore or set aside dismissed appeals could be excluded from limitation calculations under Section 14(2), which generally applies to civil proceedings prosecuted with due diligence and in good faith against the same party for the same relief, even if the proceedings are not in a court but in an administrative or quasi-judicial setting (!) (!) (!) .
The Court emphasized that the authorities under the tax statute are instrumentalities of the State, not courts, and thus are not "courts" within the meaning of Section 14(2) of the Limitation Act. Consequently, proceedings before such authorities do not fall within the scope of civil proceedings for the purpose of exclusion under Section 14(2) (!) (!) .
The legislature's scheme and language of the relevant tax provisions explicitly exclude the application of the principles of Sections 5 and 14 of the Limitation Act, except for specific, limited extensions provided within the statute itself. The provisions aim to ensure speedy resolution and finality of tax matters, and do not intend to incorporate general principles of justice, equity, or good conscience for excluding time in proceedings before administrative authorities (!) (!) (!) (!) (!) .
The court reaffirmed that statutes must be interpreted according to the clear intent of the legislature, and courts are not authorized to read into statutes principles or provisions not explicitly included, even if doing so might seem just or equitable (!) (!) .
As a result, the Court held that the time spent prosecuting proceedings to set aside dismissed appeals under the relevant rules cannot be excluded from the limitation period for filing revisions under the tax statute. The exclusion of such time would be contrary to the clear language and scheme of the statute (!) .
The judgment reversed the decision of the High Court, affirming that the limitation period must be computed without regard to the time spent in proceedings to set aside appeal dismissals, and the appeals were accordingly allowed (!) .
The decision underscores the principle that statutory provisions for limitation are to be applied strictly and that courts should not extend or modify these periods by importing principles from other legal contexts unless explicitly provided by the statute (!) .
The ruling emphasizes the importance of adhering to the language and scheme of specific statutes, especially in taxation law, and cautions against judicial overreach in modifying statutory limitation periods based on principles of fairness or justice not embedded within the statutory text.

Judgment

SARKARIA, J.: - The common question of law for determination in these appeals by special leave is: Whether Section 14 (2) of the Limitation Act, in terms, or, in principle, can be invoked for excluding the time spent in prosecuting an application under Rule 68 (6) of the U. P. Sales Tax Rules for setting aside the order of dismissal of appeal in default, under the U. P. Sales Tax Act, 1948 (for short. the Sales-tax Act) from computation of the period of limitation for filing a revision under that Act?

2. It arises out of these circumstances:

The respondent, M/s. Parson Tools and Plants (hereinafter referred to as the assessee) carries on business at Kanpur The Sales-tax Officer assessed tax for the assessment years, 1958-1959 and 1959-60, on the assessee by two separate orders. The assessee filed appeals against those orders before the Appellate Authority. On May 10, 1963, when the appeals came up for hearing, the assessee was absent. The appeals were, therefore, dismissed in default by virtue of Rule 68 (5) of the U. P. Sales-tax Rules. Sub-rule (6) of Rule 68 provided for setting aside such dismissal and re-admission of the appeal. On the same day (May 10, 1963), the assessee made two applications in accordance with Sub-rule (6) for setting aside the dismissal. During the pendency of those applications, Sub-rule (5) of Rule 68 was declared ultra vires the rulemaking authority by Manchanda, J. Of the High Court who further held that the Appellate-Authority could not dismiss an appeal in default but was bound to decide it on merits even though the appellant be absent. When these applications under Rule 68 (6) came up for hearing, on 20-10-64, the Appellate-Authority dismissed them outright in view of the ruling of Manchanda J. Against the order of dismissal of his appeals, the assessee on 16-12-1964 filed two revision petitions under Section 10 of the Sales-tax Act, before the Revisional Authority (Judge (Revisions) Sales-tax). These revision petitions having been filed more than 18 months after the dismissal of the appeals, - which was the maximum period of limitation prescribed by sub-sec. (3) of Section 10 - were prima facie timebarred. They were however, accompanied by two applications in which the assessee prayed for exclusion of the time spent by him in prosecuting the abortive proceedings under Rule 68 (6) for setting aside the dismissal of his appeals. The Revisional Authority found that the assessee had been pursuing his remedy under Rule 68 (6) with due diligence and in good faith. It therefore excluded the time spent in those proceedings from computation of limitation by applying S. 14, Limitation Act and in consequence, held that the revision petitions were within time. On the motion of the Commissioner of Sales-tax, the Revisional Authority made two references under Section 11 (l) of the Sales-tax Act to the High Court for answering the following question of law:

"Whether under the circumstances of the case, Section 14 of the Limitation Act extended the period for filing of the revisions by the time during which the restoration applications remained pending as being prosecuted bona fide."

3. The references were heard by a Full Bench of three learned Judges, each of whom wrote a separate Judgment. Dwivedi J. with whom Singh J. agreed after reframing the question held "that the time spent in prosecuting the application for setting aside the order of dismissal of appeals in default can be excluded from computing the period of limitation for filing the revision by the application of the principle underlying S. 14 (2), Limitation Act."

4. Hari Swarup J. was of the opinion: "The Judge (Revisions) Sales-tax while hearing the revisions under Section 10 of the U. P. Sales Tax Act does not act as a Court but only as a revenue tribunal and hence the provisions of the Indian Limitation Act cannot apply to proceedings before him. If the Limitation Act does not apply then neither Section 29 (2) nor Section 14 (2) of the Limi

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1975 Supreme(SC) 86

Cases Referred (3)