M/S. Ballabhdas Agarwal Vs. The State of
Bihar  INSC 39 (2 February 1962)
02/02/1962 KAPUR, J.L.
CITATION: 1966 AIR 814 1966 SCR Supl. (2) 967
Sales Tax-Appeal from order of Board of
Revenue-No Appeal from order of High Court- Assessee if can agitate the
correctness of decision of Board by special Leave-Remedy open to assessee when
question asked for, not replied by the Board to High court-Appeal not
maintainable where breach of Rule of natural Justice or violation of principle
of law not shown-Bihar sales Tax Act, 1947 (Bihar 19 of 1947), ss. 6,24,25,28.
The appellant, a Railway contractor, having
Refreshment Rooms and Tea stalls at various stations, was registered as a
dealer under the Bihar Sales Tax Act 1947. He being aggrieved by the assessment
for the year 1950-51 made by the sales Tax officer took the usual appeals to
the Sales Tax Authorities and after the appeals were rejected he took a
revision under s. 24 of the Act before the Board of Revenue Bihar which was
dismissed. He then applied under s. 25 of the Act to refer six questions of law
to the High Court.
The Board referred only one question to the
High Court. The High Court after reframing the question answered it in the negative
against him. Against the order of the Board of Revenue the appellant brought an
appeal by special leave to the Supreme Court but he did not appeal against the
judgment and order of the High Court.
968 ^ Held, that an assessee is not entitled
to agitate the correctness or otherwise of the decision given by the Tribunal
in regard to the questions which were agitated before the High Court and were
decided against him and against which no appeal was brought to the Supreme
Held, further, that if any question on which
the assessee wanted a reference to the High Court was not referred, it was open
to the assessee to apply to the High Court for a reference under s. 28 of the Bihar Sales Tax Act, 1947.
Held, also, that it has not been shown that
there was any such breach of the rules of natural justice or violation of any
principle of law which would be a good ground for our interference direct with
the orders of the Board of Revenue in an appeal under Art. 136 of the
Chimmonlal Rameshwarlal v. Commissioner of
Income Tax (central), calcutta A.I.R. 1960 S.C.
280 and Chandi Prasad Chokhani v. State of
Bihar, A.I.R. 1961 S.C. 1708, applied.
CIVIL APPELLATE JURISDISTION: Civil Appeal
No. 379 of 1961.
Appeal by special leave from the Resolution
dated April 21, 1954, of the Board of Revenue, Bihar Patna in Revision Case No.
706 of 1953.
S.K. Kapur and K.K. Jain, for the appellants.
D.P. Singh, R. K. Garg, M.K. Ramamurthi and
S.C. Agarwal, for the respondents.
1962. February, 2.-The Judgment of the Court
was delivered by KAPUR, J.-This appeal by Special Leave against the order of
the Board of Revenue, Bihar, relates to the assessment for the year 1950-51 of
Sale Tax of the appellant under the Bihar Sales Tax Act, 1947 (Act 19 of 1947),
hereinafter called the `Act'.
The appellant was a railway caterer, who had
Refreshment Rooms and Tea Stalls at various Railway Stations. He sold various
kinds of eatables, cigarettes, betels, milk, fruits and tea at railway
stations. He was registered as a dealer under the Act and had been carrying on
business for a fairly long time. His case was that as it was difficult for him
to maintain accounts in regard to eatables, 969 some of which were taxable and
others were not, he made representation in 1944 to the Bihar Government for
some arrangement so that the difficulty in keeping different sets of account
would be the obviated. As a result of his representation the Bihar Government
by a letter June 5, 1915, agreed that the appellant's taxable turnover in Bihar
would be taken to be 66 2/3% of the, gross turnover during the quarter ending
December 31, 1944, and that this percentage might be revised after December 31,
1945. As a result of this letter, the appellant did not keep separate accounts
for taxable and non-taxable items and for some of the quarters subsequent to
those mentioned in the letter above referred to were also taxed according to
the arrangements contained in that letter. For the period April 1, 1950, to
March 31, 1951, the gross turnover was Rs. 11,16,270-11-0 and the appellant
claimed that he be assessed at 66 2/3 % of that amount; but the Sales Tax
officer taxed him on the total gross turnover except for the usual rebate of 4%
allowed in such cases. He submitted that in this turnover there were included
tax-free articles such as fresh milks, meat, fish, green vegetables etc., which
were exempt from Sales tax under s. 6 of the Act. His submission was that the
excess amount assessed was Rs. 11,416-15-0. Against this order he took the
usual appeals to the Sales Tax Authorities and after the appeals were rejected,
he took a revision under s. 24 of the Act before the Board of Revenue, Bihar,
where also he was unsuccessful.
Under s. 25 of the Act, he applied for
referring 6 questions of law to the High court and those questions were as
follows:- (i) Whether upon the true construction of the agreement of 1945
between the State Government and the assessee which had been acted upon and not
reviewed, the Department was legally entitled to tax;
petitioner on his gross 970 turnover instead
of 66 2/3 % of the same ? (ii) Whether Member, Board of Revenue, having held
that "in the circumstances the petitioner had prima facie bona fide
grounds for his belief that the arrangement which the Department had entered into,
would continue" could legally hold, that the petitioner was not entitled
to be assessed in terms of the said arrangement ? (iii)Whether in the facts and
circumstances of the case, it is open to the Department to challenge the
continuance of the arrangement arrived at between the State Government and the
petitioner especially so when the State Government by its own acts or omissions
misled the petitioner into maintaining his accounts in a manner prejudicial to
the petitioner's claim for deductions on account of sale of tax free goods
during the period ? (iv) Whether in the facts and circumstances of the case,
the petitioner was entitled to the entire deduction on account of sale of meat
and fish in terms of Notification No. 5564 Ft. dated 30-3-49 under section 6 of
the Bihar Sales Act.
1947 ? (v) Whether the Member Board of
Revenue having held that meat and fish mentioned in Notification No. 5564 Ft;.
dated 30- 3-49 under section 6 of the Bihar Sales Tax, Act. 1947, included
boiled meat and fish and cold meat and fish, could legally hold that meat and
fish cooked otherwise were not covered in the terms of said notification ? 971
(vi) Whether in terms of the Notification No.
5564 Ft. dated 30-3-49 cold meat and fish and
boiled meat and fish could be distinguished from other preparation of meat and
fish ? But the Board of Revenue referred the following question to the High
Court under s. 6:- "Whether the following forms of meat and fish are
covered by Notification No. 5564 Ft.
dated 30-3-49, issued under section 6 of the
Bihar Sales Tax Act, 1947 ? (i) Raw (i.e. uncooked in any way) meat or fish.
(ii) Boiled meat and fish, cooled or
uncooled, meant for sale or consumption outside the petitioner's premises.
(iii)Fish or meat, which has been boiled or
cooked in some other way served as separate or part of a dish outside the
petitioner's premises as separate dishes or part of a menu.
(iv) Fish or meat, which has been boiled or
cooked in some other way, served as separate dishes or part of a dish outside
the petitioner's premises." The High court reframed the question as
follows:- "Whether the petitioner was entitled to exemption under
Notification No. 5564 Ft., dated 30th March, 1949, issued under section 6 of
the Bihar Sales Act, 1947 with regard to the sales of the preparations of meat
and fish e.g., meat curry and fish curry served as separate dishes, or as part
of the menu, at lunch or dinner, at the petitioner's premises or outside
?" and answered it against the appellant. It is against the order of the Board
of Revenue that the appellant has come in appeal by special leave but has 972
not appeared against the judgment and order of the High Court.
This Court in M/s. Chimmonalall Rameshwarlall
v. Commissioner of Income-tax (Central) Calcutta (1) held that in cases where a
reference is made to the High Court and the appeal is brought only against the
order of the Income Tax Appellate Tribunal then the Supreme Court, if it
interfered, would in fact be setting aside the judgment of the High Court
without there being an appeal to this Court, and that this Court could not
bypass the normal procedure which was to be adopted for the purpose. In a later
Judgment in Chandi Prasad Chokhani v. State of Bihar (2)a similar view was
taken that as the assessee had not obtained Special Leave in respect of any of
the orders passed by the High Court under s. 25 those orders became final and
binding and the assessee could not be allowed to bypass or go behind the orders
of the High Court and such exercise would be particularly inadvisable in a case
where the result may be a conflict of the decision of two courts of competent
jurisdiction, which was contrary to the object of ss. 23, 24 and 25 of the Act.
In this view of the law the appellant is not entitled to agitate the correctness
or otherwise of the decision given by the Tribunal in regard to the questions
which we agitated before the High Court and were decided against the appellant
and against which no appeal has been brought.
But he submits that there are three other
questions which also arise, and on which the appellant wanted a reference to
the High Court but which were not referred. It was open to the appellant to
apply to the High Court for a reference under s. 25. That the appellant did not
do, and it has not been shown that there was any such breach 973 of the rules
of natural justice or violation of any principal of law which would be a good
ground for our interference direct with the orders of the Board of Revenue in
an appeal under Art. 136 of the Constitution.
In our opinion the appeal is without force
and is dismissed with costs.