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2014 Supreme(Bom) 852
In the High Court of Bombay at Nagpur
B.P. DHARMADHIKARI & Z.A. HAQ, JJ.
Shikshak Sahakari Bank Limited
Versus
State of Maharashtra, through its Principal Secretary, Finance Department & Others
Writ Petition No. 2881 of 2013
Decided on: 07-04-2014
For the Petitioner:N.C. Phadnis, Advocate.
For the Respondents: N.P. Mehta, Assistant Govt. Pleader.
Headnote:Bombay Sales Tax Act, 1959 - Section 55 - Appeal against order of assessment. - Held, since petitioner-Bank is directly aggrieved by order of assessment, hence appeal against said order by Bank is maintainable. Provisions of Section 2 itself reveal a person, dealer, commission agent, importer, as different concepts. Definition of ’person’ in Section 2(19) shows that it may include a Company or an Association or a Body of Individuals, a Firm or Local Authority also. Section 3 dealing with incidence of tax and other provisions upto Section 7 deal with incidence of tax, liability of dealer etc. Section 8-A is about power with State Government to specify points of sale at which goods may be taxed. Section 13-AA is on purchase tax and it implies phrases like Dealer, Commission Agent, any person. First proviso to Section 14 again shows the same position. Sub-section (1-A) thereof implies the word "any person" or "dealer". Second and third proviso to Section 15 speaks of a person. Court needs not elaborate more on use of these different words having different connotations in the context in which the legislature has used it, shows that a third person who is not otherwise a dealer or commission agent, may also be covered and found himself subjected to the provisions of Bombay Sales Tax Act. Section 38-B is about special powers of Sales Tax Authorities for recovery of tax as arrears of land revenue. It enables the department to recover tax from any other person, apart from dealer. Section 38C again shows the same position. Section 39 is about special mode of recovery and clauses (a) and (b) therein again shows possibility of such third person who is neither a dealer nor a commission agent, being subjected thereto. It is not in dispute that respondents have proceeded against the petitioner under these provisions.
Section 54 which appears in Chapter VII dealing with proceedings and it speaks of bar to challenge to an order of assessment or to an order passed under Bombay Sales Tax Act. Orders passed under Section 38B, 38C and 39 against such third person shall be definitely subjected to such bar and hence, those orders cannot be called in question in any Court and only remedy there for, is an Appeal under Section 55. Court has already noted above that Section 55 is neutrally worded, same is the case of Section 54. Section 57 which deals with revision contains a important provision in this respect. Sub-section (3) thereof stipulates that no order can be passed in revision which may adversely affect any person, unless such person has been given reasonable opportunity of being heard. Thus the word "person" employed in Section 57(3) is in wider sense and includes even a third person. In view of the scheme of Bombay Sales Tax Act, petitioner is a person who is recognized as such under Bombay Sales Tax Act and hence, appeal filed by it cannot be said to be not maintainable. It is directly aggrieved by the order of assessment, as department is treating him as a person who has stepped in the shoes of assessee for the purposes of recovery.
B.P. Dharmadhikari, J.
1. Heard finally by consent of Shri N.C. Phadnis, learned Counsel for the petitioner and Ms. N.P. Mehta, learned Assistant Government Pleader for respondents. Rule is therefore issued & made returnable forthwith.
2. By this petition filed under Articles 226 and 227 of the Constitution of India, the petitioner a Co-operative Bank questions common judgment dated 03.05.2013 delivered in Second Appeal Nos.469 to 473 of 2012 by the 4th Bench of Maharashtra Sales Tax Tribunal at Mumbai, holding that it cannot grant leave to petitioners to file an appeal under Section 55 of the Bombay Sales Tax Act, 1959 and dismissing its appeal as unsustainable. Thus, merits of challenge have not been looked into.
3. Facts necessary to understand the challenge can briefly be stated now. Petitioner is a Cooperative Bank registered as such under the provisions of Maharashtra Cooperative Societies Act, 1960. In course of its business, it extended term loan of Rs.1 Crore to one M/s. Kamakshi Hotel Private Limited, a Company having three Directors on 10.01.1997. On 09.10.1997, it advanced Rs.50 lacs more and on 25.07.1998, another Rs.50 lacs. Thus, total loan advanced was Rs.2 Crores for opening a family resort against hypothecation by creating registered mortgage of land, building etc. in its favour. The loan could not be repaid and in view of defaults, petitioners resorted to recovery under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “the Securitisation Act” for short). It took symbolic possession of the property on 19.09.2003, and actual physical possession on 05.11.2004. Mortgaged property was then auctioned on 05.02.2011 and nobody, including the respondent nos.2 to 6, objected to the said public auction.
4. On 07.02.2011, Sales Tax Department approached petitioner with demand of Rs.92,27,099/- towards its dues. Petitioners state that for the first time, Sales Tax Department claimed that it had attached property on 04.10.2010, it issued a notice under Section 39 of the Bombay Sales Tax Act, 1959 on 18.02.2011 for recovery of said amount, and it was received by petitioner. Petitioner replied to it on 25.02.2011. It also applied to Sales Tax Department for supplying certified copy of the assessment orders from 01.04.2000 to 31.03.2005. It then gathered that all orders were passed on a single day i.e. 12.12.2008 and period covered therein was from 01.04.2000 to 31.03.2005. Petitioner claims that notice for assessment or then assessment orders were not properly served. They point out that total amount as per the said assessment orders for these 5 years is Rs.82,04,255/-. Department also informed the petitioner that an amount of Rs.10,22,844/- was outstanding for the period from 01.04.1994 to 31.03.1998. The department on 26.09.2012 informed the petitioner that it has to pay both these amounts, otherwise, it would approach the Reserve Bank of India for attaching the accounts of petitioner with it. Petitioner Bank immediately paid amount Rs.10,22,844/- on 29.09.2012.
5. Petitioners also state that they procured information from State Excise Department regarding licence possessed by the borrower establishment M/s. Kamakshi Resorts and as per communication dated 03.08.2011 and 17.09.2011, they learnt that liquor permit/licence granted on 10.09.1998 was not renewed from 17.04.2002 and, therefore, it expired. Details of sales conducted between 2000 to 2002 were also supplied by the Excise Department on 17.09.2011. Thus, a very small quantity of liquor/beer was sold by M/s. Kamakshi Resort and assessment undertaken by Sales Tax Officer at Nagpur (Respondent No.4) in absence of said data is, therefore, unsustainable. The Assessing Officer has passed an ex-parte order without any documentary proof or material for arriving at these figures. The petitioners state that said resort had exemption from Sales Tax for selling food and nonalcoholic drinks a
