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IN THE HIGH COURT OF MADHYA PRADESH
P.V. Dixit, C.J. and K.L. Pandey, J.
Nathulal Chhotelal Shellac, Factory
Vs.
The Deputy Commissioner of Sales Tax and Anr.
Misc. Petn. No. 339 of 1961
Decided On: 14.03.1962
SALES TAX - RIGHT OF APPEAL - VESTED RIGHT - ABROGATION BY STATUTE - INTERPRETATION OF STATUTES - RETROSPECTIVE OPERATION - SECTION 52 OF THE MADHYA PRADESH GENERAL SALES TAX ACT, 1959.
Fact of the Case:
The petitioners, assessees under the Central Provinces and Berar Sales Tax Act, 1947, filed second appeals against orders of assessment of sales tax. The Deputy Commissioner of Sales Tax declined to entertain the appeals on the ground that the Board of Revenue, Madhya Pradesh, had jurisdiction to entertain such appeals under the Madhya Pradesh General Sales Tax Act, 1959 (the Act). The petitioners challenged this decision, arguing that their right to appeal under the repealed Act was a vested right that could not be taken away by the new Act.
Finding of the Court:
The court held that the petitioners' right to appeal was a vested right that could not be taken away by the new Act. The court interpreted Section 52 of the Act, which repealed the previous Sales Tax Acts, and found that it did not expressly or by necessary implication abrogate the right of appeal under the repealed Act. The court also held that the change in the forum for hearing first appeals under Section 52(2) of the Act did not amount to a taking away of the vested right of appeal.
Issues: 1. Whether the petitioners' right to appeal under the repealed Act was a vested right. 2. Whether Section 52 of the Act abrogated the right of appeal under the repealed Act. 3. Whether the change in the forum for hearing first appeals under Section 52(2) of the Act amounted to a taking away of the vested right of appeal.
Ratio Decidendi: 1. A right of appeal is a vested right that cannot be taken away or impaired save by express words or necessary implication. 2. Section 52 of the Act did not expressly or by necessary implication abrogate the right of appeal under the repealed Act. 3. The change in the forum for hearing first appeals under Section 52(2) of the Act did not amount to a taking away of the vested right of appeal.
Final Decision: The court allowed the petition and quashed the orders of the Deputy Commissioner of Sales Tax declining to entertain the second appeals. The court directed the Deputy Commissioner to receive and dispose of the appeals in accordance with law.
Pandey, J.
1. This petition under Articles 226 and 227 of the Constitution' is directed against certain orders passed and action taken by the Deputy Commissioner of Sales Tax, Jabalpur, whereby he declined to entertain second appeals against orders of assess-taewt of sales tax on the ground that, under the Madhya Pradesh General Sales Tax Act, 1959 (2 of 1959), the Board of Revenue, Madhya Pradesh, had jurisdiction to entertain, such appeals.
2. For brevity, the details of the various assessment orders, first appeals, second appeals and action taken to regard to second appeals are given in the following table :
Period of assessment
Date
Date of order in first appeal
Date of second appeal and action taken
1.
19-10-1932
to
6-11-1953
22-9-1956
1-4-1961
20-10-1961 returned
2.
7-11-1953
to
26-10-1954
29-12-1956
1-4-1961
20-10-1961 returned
3.
27-10-1954
to
14-11-1955
24- 4-1958
10-1-1959
Transmitted to the Board of Revenue
4.
15-11-1955
to
2-11-1956
31-8-1960
27-12-1960
4-10-1961 returned
3. Prior to the commencement of the Madhya Pradesh General Sales Tax Act, 1959 (hereinafter called the Act on 1 April 1959, the assessees had, under the Central Provinces and Berar Sales Tax Act, 1947, a right to file two successive appeals against any Original Order of assessment of sales tax. Second appeals, which could be tiled on a court-fee stamp of Rs. 5/- lay to the Deputy Commissioner of Sales Tax. Against an Order passed in second appeal, a revision lay to the Board of Revenue. Only after an order was passed in revision could an assesses require the Board to refer to the High Court questions of law arising out ot that order. Under the scheme of the Act, which is in force, a second appeal, which can be filed on a court-fee stamp of Rs. 25/-, lies to the Board. The further remedy of revision against an order passed in second appeal is not provided and, if the assessee is aggrieved, he may require the Board to refer to the High Court questions of law arising out of the order passed in second appeal.
4. The short question for consideration, in this case is whether if the remedial rights available under the Central Provinces and Berar Sales Tax Act, 1947, in cases arising under that Act were abrogated by the provisions of the Act. It will be seen' that the petitioners filed their returns in the four cases specified in paragraph 2 long prior to the commencement of the Act on 1 April 1959 and, so also, notices were issued to the petitioners before that date. In Hoosein Kasam Dada (India) Ltd. v. State of Madhya Pradesh, 1953 SCR 987 : AIR 1953 SC 221, S. R. Das, J. observed:
"Finally, Sri Ganapathy lyer faintly urges that until actual assessment there can be no 'lis' ands therefore, no right of appeal can accrue before that event. There are two answers to this plea. Whenever there is a proposition by one party and an opposition to that proposition by another a 'lis' arises. It may be conceded, though not deciding it, that when the assess-ee files his return, a 'lis' may not immediately arise, for under Section 11 (1) the authority may accept the return as correct and complete. But if 'the authority is not satisfied as to the correctness of the return and calls for evidence, surely a controversy arises involving a, proposition by the assessee and an opposition by the State. The circumstance that the authority who raises the dispute is himself the judge can make no difference, for the authority raises the dispute in the interest of the State and in So acting only represents the State. It will appear from the dates given above that in this case. the 'lis' in the sense explained above arose before the date of amendment of the section. Further, even it the 'lis' is to be taken as arising only on the date of assessment there was a possibility of such a 'lis' arising as soon as proceedings started with the filing of the return, or, at any rate, when the authority called for evidence and started the hearing and the right of appeal must be taken to have been in existence even
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