Back
SUPREME COURT OF INDIA
N.L. UNTWALIA AND P.S. KAILASAM, JJ.
The Supdt. of Taxes, Tezpur and others. Appellants
Versus
M/s. Bormahajan Tea Co., Ltd., Respondent.
Civil Appeals Nos. 602 and 603 of 1974
Decided on 17-1-1978.
Advocates appeared
Mr. L. N. Sinha, Sr. Advocate, (Mr. S. N. Chowdhary, Advocate with him), for Appellant; M/s. A. K. Sen and J. P. Bhattacharjee, Sr. Advocates (Mr. P. H. Parekh and Miss. Manju Jetly, Advocates with them), for Respondent.
Tax Act, 1922 - Section 18A – Constitution of India – Article 304 - Jurisdiction of the Court - Without payment of the tax - It appears to me to be merely piling unreason upon technicality to hold upon the circumstances of this case that it is open to the judgment-debtors on these grounds to object to the jurisdiction of the Court because they have not got a formal notice to do something, namely to dispute the execution of the decree when in point of fact they were busy disputing about it in all the courts for the best part of the last two years." Relying on the above observation the learned counsel submitted that the respondent who challenged the validity of the enactment and who took part in the litigation questioning the validity of the assessment for several years and who filed the return cannot now contend that the assessment is not valid having been filed beyond time or without payment of the tax – Held, Learned counsel for the respondent, submitted that this Court should not allow the plea put forward on behalf of the appellant that the return was a valid one as it was admitted that the assessment did not proceed on the return submitted. He referred to the judgment of the High Court wherein it is stated: "It is also the admitted position in both these cases, the Superintendent of Taxes treated the returns filed as invalid ones". It was submitted that the tax authorities cannot now be allowed to change their front and submit that they proceeded to assess on the basis of the returns furnished by the respondent. It is common ground that no notice under Section 7 (2) of the Act within 2 years of the expiry of the return period was issued to the respondent. This Court, by a majority in Supdt. of Taxes, Dhubri v. Onkarmal Nathmal Trust, 1975 Supp SCR 365 at p. 375 has held that before proceedings could be taken under Section 9 (4) it is mandatory that notice under Section 7 (2) will have to be issued. Therefore, the only approach that is available to the State and which has been taken by the learned counsel, is that the assessment proceedings are valid as the return is not non est. The question that arises for consideration is whether we should allow this plea to be taken by the State when it admitted before the High Court that the assessment was not based on the return. It has to be seen that the ground that was urged by the respondent was that the returns were non est which was accepted by the High Court. We do not think we will be justified in these appeals under Art. 136 of the Constitution to permit the State to contend that it can proceed on the basis that the returns were valid, especially when the plea before the High Court was that the returns were invalid. This Court has repeatedly held that the exercise of power under Art. 136 is discretionary. (vide Trivedi v. Nagrashna) (1961) 1 SCR 113 at p. 117. In State of Gujarat v. Gujarat Revenue Tribunal (1976) 3 SCR 565 at p. 576 this Court held that even though there may be substance in the argument put forward on behalf of the appellant the Court taking the totality of the circumstances may decline to interfere in an appeal filed by special leave of the Court under Art.136 of the Constitution - Appeals dismissed
JUDGMENT
KAILASH, J. :— These appeals are preferred by the Superintendent of Taxes, Tezpur, by special leave against the judgment and order passed by the High Court of Assam and Nagaland at Gauhati in Civil Rule Nos. 1000 and 1001 of 1969.
2. The respondent is M/s. Bormahajan Tea Co. Ltd., who is assessee under the Assam Taxation (on Goods Carried by Road or on Inland Water-ways) Act, 1961. The Assam Taxation (on Goods Carried by Road or on Inland Water-ways) Act was passed in 1954. The validity of the Act was challenged by various parties before the Assam High Court and this Court. This Court on September 26, 1960 held that the Act was ultra vires of the Constitution as the previous sanction of the President was not taken as required under Art. 304 of the Constitution. The present Act, the Assam Taxation (on Goods Carried by Road or on Inland Water-ways) Act, 1961 (hereinafter called as "the Act"), was passed by the Assam Legislature with the sanction of the President for the purpose of validating the tax that had been imposed under the 1954 Act. The Act received the assent of the President on April 6, 1961 and was published in the Assam Gazette on April 15, 1961 and was to be in force only up to March 31, 1962. The validity of this Act was also challenged and the High Court of Assam by its order dated August 1, 1963 held that this Act was also ultra vires. The State Government appealed to the SC against this judgment. While the appeal was pending before the SC two writ petitions filed by different assessees under Art. 32 of the Constitution before the SC were disposed of on December 13, 1963 holding that the Act was valid. On an application made by the Government of Assam pending the appeal against the order dated August 1, 1963 of the Assam High Court the SC granted stay of the operation of the judgment of the High Court and on January 29, 1965 made the stay absolute subject to the condition that the assessment proceedings could continue but no levy should be made. On April 1, 1968 the SC reversed the judgment dated August 1, 1963 of the Assam High Court and held the present Act to be valid. Though the present Act was passed in 1961 as the matter was pending before the courts the assessment proceedings could not be taken up till January 29, 1965 when the SC allowed the assessment proceedings to be continued.
3. The two appeals before us relate to the assessment quarter ending September 30, 1960 and December 31, 1960. In Civil Rule No. 1000 of 1969, Assam High Court out of which Civil Appeal No. 602 of 1974 before this Court arises, the respondent company submitted the return on October 27, 1960 under Section 7 (1) of the Act for the period ending September 30, 1960. The respondent submitted the return without paying tax on the return as required under Section 20 (2) of the Act. In Civil Rule No. 1001 of 1969 in the Assam High Court, out of which Civil Appeal No. 603 of 1974 arises in this Court, the respondent submitted a return of February 14, 1961 for the quarter ending December 31, 1960 under Section 7 (1) of the Act. The return under Section 7 (1) has to be submitted under Section 7 (3) within 30 days of the completion of the quarter in respect of which the returns are to be filed. In this return also no tax as required was paid prior to the submission of the return. It may be noted that while in Civil Appeal No. 602 of 1974 the return was filed within time but without payment of tax, in Civil Appeal No. 603 of 1974 the return was filed out of time and without payment of the tax.
4. Orders of assessments were passed in both the cases on June 19, 1969 in pursuance of the provisions of Section 9 (4) of the Act. It is the common case that no notice either under Section 7 (2) or Section 11 of the Act was served on the respondent for the submission of the return for the periods in question. In the High Court the respondent submitted that order of assessment made by the Revenue on June 19, 1969 is not valid in law on two grounds
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
