1. Sales tax assessment on handmade biris — Claim of exemption under notification rejected by authority based on misconstruction — Petition under Article 32 for enforcement of fundamental rights. (Para 2 , 5 , 24 , 25 , 26 , 27 , 102 , 103 , 162 )
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1962 Supreme(SC) 319
SUPREME COURT OF INDIA
A.K.Sarkar : J.L.Kapur : J.R.Mudholkar : K.Subba Rao : M.Hidayatullah : N.Rajagopala Ayyangar : S.R.Dass
Ujjam Bai: Tata Engineering And Locomotive Company Limited: Mohan Lal Hargovind Das
Versus
State Of U.P.: State Of U.P.: Sales-lax Officer, Allahabad
Case No. : 79 of 1959, 1349 of 1961, 572 of 1960
Date of Decision : 4/10/62
Advocates Appeared: Andley S.N. : Dadachanji J.B. : Dadachanji J.R. : Daphtary C.K. : Dapthary C.K. : Ghari A.S.R. : Goswami M.V. : Iyengar B.R.L. : Khare S.C. : Lal C.P. : Mathur G.C. : Mathur O.C. : Narain Rajindar : Narain Ravindra : Nath Rameshwar : Palkhivala N.A. : Parthasarathi B. : Parthasarathy B. : Pathak G.S. : Ramamurthi : Ramamurthi M.K. : Sanyal H.N. : Sen T.M. : Setalvad M.C. : Singh D.P. : Vohra P.L.
An order of assessment by a quasi-judicial authority under an intra vires statute, made within its jurisdiction, does not violate fundamental rights even if based on a misconstruction of law. Such errors must be corrected via statutory appeals or Article 226, as Article 32 is not an appellate remedy.
Headnote:(A) Constitution of India - Articles 12, 19(1)(g), 31, 32, 226, 265 - Sales Tax Act - Section 4(1) - Order of assessment by taxing authority - Misconstruction of notification - Challenge under Article 32 - Whether a mere error of law or misconstruction of a provision of an intra vires statute by a quasi-judicial authority constitutes a violation of fundamental rights - If the statute is intra vires and the authority acts within its jurisdiction, a decision based on a misconstruction of law does not infringe fundamental rights - Such an order is a valid legal act, regardless of whether it is correct or erroneous - The proper remedy is through statutory appeal or revision, or a petition under Article 226 if the error is apparent on the face of the record (Paras 21, 35, 181, 184).
(B) Article 32 - Scope and Nature - Not an appellate jurisdiction - Guaranteed right for enforcement of fundamental rights only - Does not apply unless a fundamental right is actually invaded - A valid legal order, even if erroneous, does not offend fundamental rights (Paras 21, 34).
(C) Jurisdiction of Quasi-Judicial Authorities - Distinction between jurisdictional error and error of law - An authority does not lose jurisdiction by arriving at a wrong conclusion - A petition under Article 32 is maintainable where: (i) the statute is ultra vires, (ii) the action is without jurisdiction, or (iii) the action is procedurally ultra vires or violates principles of natural justice (Paras 14, 15, 184).
Facts of the case:
A manufacturer of handmade biris claimed exemption from sales tax based on a government notification. The assessing authority rejected the claim on the ground that the condition regarding payment of additional excise duties was not met. After the claim was dismissed by the appellate authority and a petition under Article 226 was rejected by the High Court, a petition was filed under Article 32 alleging violation of the fundamental right to carry on trade and business.
Findings of Court:
The majority held that an order of assessment made by an authority under a taxing statute which is intra vires and in the exercise of its jurisdiction cannot be challenged under Article 32 on the sole ground of misconstruction of a provision or notification. Such an order is legally valid despite any error.
Issues: (1) Whether an order of assessment under an intra vires taxing statute is open to challenge as repugnant to Article 19(1)(g) solely on the ground of misconstruction of a provision or notification? (2) Whether the validity of such an order can be questioned in a petition under Article 32 of the Constitution?
Ratio Decidendi: The court reasoned that Article 32 is for the enforcement of fundamental rights, not for correcting errors of law. If a quasi-judicial authority acts within its jurisdiction under a valid law, its decision—whether right or wrong—is a legal act. A legal act cannot, by definition, violate a fundamental right. A distinction exists between an order passed under an ultra vires law (which is a nullity) and an erroneous order passed under a valid law. The latter must be corrected through the prescribed statutory appeals or revisions.
Result: Writ petition dismissed.
Legal Category Hierarchy
- constitutional law
- administrative law
- taxation law
Table of Contents
2. Petitioner — Misconstruction of valid statute violates fundamental right to trade — Respondent — Erroneous decision within jurisdiction is a legal act not infringing fundamental rights. (Para 5 , 6 , 7 , 31 , 32 , 69 , 70 , 71 , 104 , 135 , 139 )
3. Distinction between jurisdictional errors and errors of law within jurisdiction — Quasi-judicial authorities are State instrumentalities but their validly exercised jurisdiction produces legal acts. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 21 , 33 , 34 , 35 , 36 , 38 , 40 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 60 , 61 , 125 , 126 , 127 , 141 , 142 , 143 , 144 , 145 , 146 , 148 , 149 , 150 , 174 , 176 , 181 , 183 )
4. An order made by a quasi-judicial authority within its jurisdiction under an intra vires statute does not violate fundamental rights, even if based on misconstruction. (Para 21 , 35 , 36 , 184 )
5. Writ petition under Article 32 dismissed — Application for restoration of appeal dismissed. (Para 21 , 63 , 186 )
6. Can an assessment order under an intra vires taxing statute be challenged under Article 32 solely on the ground of misconstruction of a provision?
No. An order made by a quasi-judicial authority in the exercise of its jurisdiction under a valid law is a legal act. Even if erroneous, it does not infringe fundamental rights; the proper remedy is statutory appeal or a petition under Article 226. (Para 21 , 35 , 36 , 184 )
7. In what circumstances can a petition under Article 32 lie against the action of a taxing authority?
A petition under Article 32 is maintainable if: (1) the statute or provision is ultra vires, (2) the authority acts without jurisdiction or wrongly assumes it, or (3) the action is procedurally ultra vires, such as violating principles of natural justice. (Para 14 , 184 )
8. Do quasi-judicial authorities fall within the definition of State under Article 12 of the Constitution?
Yes. Quasi-judicial authorities are instrumentalities of the government exercising statutory functions and are comprehended within the expression other authorities under Article 12, regardless of whether they exercise judicial or administrative powers. (Para 61 , 92 , 118 , 152 )
9. What is the legal distinction between a jurisdictional error and an error of law within jurisdiction?
Jurisdiction is the authority to decide. A tribunal does not lose its jurisdiction by reaching a wrong conclusion of law or fact. An error of law committed within the limits of jurisdiction is a valid legal act until reversed on appeal. (Para 15 , 176 , 181 )
S. K. DAS, J.:
(1) THE facts of the case have been stated in the judgment of my learned brother Kapur J., and it is not necessary for me to restate them. I have reached the same conclusion as has been reached by my learned brother. But in view of the importance of the question raised, I, would like to state in my own words the reasons for reaching that conclusion.
(2) THE two questions which have been referred to this larger bench are: 1. Is an order of assessment made by an authority, under a taxing statute which is Intra vires, open to challenge as repugnant to Art. 19 (1) (g), on the sole ground that it is based on a misconstruction of a provision of the Act or of a notification issued there under? 2. Can the validity of such an order be questioned in a petition under Art. 32 of the Constitution ?
(3) THESE two questions are inter-connected and substantially relate to one matter: is the validity of an order made with jurisdiction under an Act which is Intra vires and good law in all respects, or of a notification properly issued thereunder, liable to be questioned in a petition under Art. 32 of the Constitution on the sole ground that the provisions of the Act, or the terms of the notification issued thereunder, have been misconstrued ?
(4) IT is necessary, perhaps, to start with the very Article, namely, Art. 32, with reference to which the question has to be answered. `32. (1) The right to move the. Supreme court by appropriate proceedings for the enforcement of the rights conferred by this Part is guaranteed. (2) The Supreme court shall have power to issue directions or orders or write, including writs in the nature of habeas corpus, mandamus, prohibition, qua warranto and certiorari, whichever may be appropriate, for the enforcement of the rights conferred by this Part. Without prejudice to the powers conferred on the Supreme court by clauses (1) and (2), Parliament may by law empower any other court to exercise within the local limits of its jurisdiction all or any of the powers exercisable by the Supreme court under clause (2). The right guaranteed by this article shall not be suspended except as otherwise provided for by this Constitution.` The Article occurs in Part III of the Constitution headed Fundamental Rights. It is one of a series of articles which fall under the sub-head, `Right to Constitutional Remedies`. There can be no doubt that the right to move the Supreme court by appropriate proceedings for the enforcement of a right conferred by Part III is itself a guaranteed fundamental right. Indeed, cl. (1) of the Article says so in express terms. Clause (2) says that this court shall have power to issue directions or orders or writs, including writs in the nature of habeas Corpus, mandamus, prohibition, qao warranto and certiorari, whichever may be appropriate, for the enforcement of any of the rights conferred by Part III. Clause (4) makes it clear that the right guaranteed by the Article shall not be suspended except as otherwise provided for by the Constitution. Article 359 of the Constitution . states that where a Proclamation of Emergency is in operation the President may by order declare that the right to move any court for the enforcement of such of the rights conferred by Part III as may be mentioned in the order and all proceedings pending in any court for the enforcement of the rights so mentioned shall remain suspended etc. It is clear, therefore, that so long as no order is made by the President to suspend the enforcement of the rights conferred by Part III of the Constitution every person in India, citizen or otherwise, has the guaranteed right to move the Supreme court for enforcement of the rights conferred on him by Part III of the Constitution and the Supreme court has the power to issue necessary directions, orders or writs which may be appropriate for the enforcement of such rights. Indeed, this court has held in more than one decision that under the
