A.P. Vs. T.G. Lakshmainah Setty &
Sons  INSC 236 (13
K. Ramaswamy, K. Venkatachala N. (J)
1994 AIR 2377 1994 SCC Supl. (2) 386 JT 1994 (3) 367 1994 SCALE (2)668
No. 2798 of 1983 is taken on board.
These two appeals relate to different assessments under the Andhra Pradesh
General Sales Tax Act, 1957 (Act No. VI of 1957), for short, 'the Act'. The
respondent-assessee is a registered dealer carrying on business in groundnut oil
seeds and cotton seeds. The appeals relate to "cotton lint". The
respondent was assessed under Section 5(1) for the assessment years 1967-68,
1970-71 and 1971-72, the last of which was on November 29, 1975 as "cotton" unclassified general goods at 3%. In
similar circumstances, when the other assessees carried the matter in revision
to the High Court in Alimchand Topandas Oil Mills v. State of A.P.I the High
Court of A.P. held that cotton lint comes under 'cotton waste' in Entry 69 of
Schedule I and becomes exigible to tax at 1 % at the relevant time. Relying
upon the decision, the respondent-assessee made a representation in May 1976
under Section 20(2) of the Act requesting the Dy. Commissioner to revise the
assessments. Initially even without numbering the revisions the Dy.
Commissioner had dismissed them.
on appeal, the Sales Tax Appellate Tribunal (STAT) by its order dated November
18, 1977 remitted the cases to the Dy. Commissioner directing to number the
cases and to dispose them of according to law. On receipt thereof, the Dy.
Commissioner by his order dated October 14, 1980 again dismissed the revisions. The respondent assessee
carried in revision to the STAT which by its order dated October 16, 1984, allowed the revisions applying the
ratio in Alimchand case, and directed reassessment under Entry 69 of Schedule
revision, the High Court by impugned order dated April 4, 1985, dismissed them in limine. Thus these appeals by special
primary question in these cases is whether a revision under Section 20(2) is
maintainable at the instance of the assessee. Section 20 provides at the
relevant time thus :
Revision by Commissioner of Commercial Taxes and other prescribed authorities.-
(1) The Commissioner of Commercial Taxes may suo motu call for and examine the
record of any order passed or proceeding recorded by any authority, officer or
person subordinate to it, under the provisions of this Act, including
sub-section (2) of this section* [and if such order or proceeding recorded is
(prejudicial to the interests of revenue), may make such enquiry, or cause such
enquiry to be made and subject to the provisions of this Act, may initiate
proceedings to revise, modify or set 1 (1976) 37 STC 603 (AP) 388 aside such
order or proceeding] and may pass order in reference thereto as it thinks fit.
for the words 'for the purpose of satisfying itself as to the legality or
propriety of such order as to the regularity of such proceeding' by Act 18 of
1985, w.e.f. 1-7-1985." Sub-section (2) of Section
20 gives power similar to that in sub-section (1), to the Joint Commissioner, Dy.
and the Commercial Tax Officer in the case of orders passed or proceedings
recorded by the authorities or officers or persons subordinate to them.
question whether the assessee has a right to make an application for the
exercise of suo motu power by the Commissioner calls for consideration in the
light of the other provisions in the Act, expressly providing for a right of
appeal to the assessee. Under Section 19 of the Act a right to appeal to the
appellate authority against original orders or proceedings of certain
authorities, has been given to the aggrieved dealer. Section 21 also gives a
right of appeal, to the aggrieved dealer to the Appellate Tribunal postulating
that any dealer objecting to an order passed or proceeding recorded by any
prescribed authority on appeal under Section 19 or Section 14(4-C) or Section
20(2) may appeal to the Appellate Tribunal within 60 days from the date on
which the order or proceeding was served on him.
the statute itself has given a right to the dealer to object to an order passed
or proceeding recorded under the Act, which is prejudicial to him, by filing an
appeal against such order, under Section 14 or 19 or Section 21 or a revision
under Section 22 of the Act to the Appellate Tribunal (sic). As stated earlier,
against the original order an appeal shall lie to the appellate authority
within a period of 30 days from the date of the receipt of the notice served on
the dealer and a further appeal to the Appellate Tribunal. The order under
Section 20(1) could also be appealable again to the STAT by the aggrieved
dealer and a further revision under Section 23 to the High Court under the Act.
Thus, the Act has given right and remedy of appeal or a revision to the dealer,
wherever it was so intended. As seen, Section 20 is a suo motu revisional power
exclusively given to the Commissioner or the Joint Commissioner or the Dy.
Commissioner or the Commercial Tax Officer, as the case may be, to revise the
orders or the proceedings of the officers subordinate to the respective
officers. Whether suo motu power under Section 20 of the Act could have been
invoked by an assessee is the question.
Judicial, Committee of the Privy Council in CIT v. Tribune Trust2 had
considered similar question. It was a case where an income tax assessment order
in respect of an assessment year had reached finally by reason of an order made
by the Judicial Committee of the Privy Council dated June 13, 1939. On August 13, 1939, suo motu power of the Commissioner was, however, sought to
be invoked by the assessee to revise the orders of assessments relating to
previous years, which had become final. The High Court, following the decision
of the Privy Council which was in favour of the assessee, directed the
Commissioner to exercise the power of revision and revise the earlier orders of
assessment. Section 33 of the Indian Income Tax Act, 1922 reads thus :
The Commissioner may of his own motion call for the record of any proceeding
under this Act which has been taken by any authority 2 AIR 1948 PC 102: 74 IA
306: (1948) 16 ITR 214 389 subordinate to him or by himself when exercising the
power of an Assistant Commissioner under sub-section (4) of Section 5.
receipt of the record the Commissioner may make such enquiry or causesuch
enquiry to be made and, subject to the provisions of this Act, may passsuch
orders thereon as he thinks fit :
that he shall not pass any order prejudicial to an assessee without hearing him
or giving him a reasonable opportunity of being heard." When the matter
was carried in appeal, the Judicial Committee which considered the scope and
ambit of suo motu power of the Commissioner under Section 33 of the Income Tax
Act held thus :
fallacy implicit in this question has been made clear in the discussion of the
first two questions. It assumes that Section 33 creates a right in the assessee.
In their Lordships' opinion it creates no such right.
behalf of the respondent the well-known principle which was discussed in Julius
v. Bishop of Oxford3 was invoked and it was urged that the section which opens
with the words, '[t]he Commissioner may of his own motion' imposed upon him a
duty which he was bound to perform upon the application of an assessee.
possible that there might be a contest in which words so inapt for that purpose
would create a duty. But in the present case there is no such context. On the
contrary, Section 33 follows upon a number of sections which determine the
rights of the assessee and is itself, as its language clearly indicates,
intended to provide administrative machinery by which a higher executive
officer may review the acts of his subordinates and take the necessary action
upon such review. It appears that as a matter of convenience a practice has
grown up under which the Commissioner has been invited to act 'of his own
motion' under the section and where this occurs a certain degree of formality
has been adopted. But the language of the section does not support the
contention, which lies at the root of the third question and is vital to the
respondents' case, that it affords a claim to relief. As has been already
pointed out, appropriate relief is specifically given by other sections; it is
not possible to interpret Section 33 as conferring general relief.
appears to them that an order made by the Commissioner under Section 33, can
only be said to be prejudicial to the assessee when he is, as a result of it,
in a different and worse position than that in which he was placed by the order
under review. If the assessee has a complaint against any assessment or order
made by a subordinate officer, he has the appropriate and specific remedy which
the Act provides. The Commissioner may act under Section 33, with or without
the invitation of the assessee; if he does so without invitation, it is clear
that, if he does nothing to worsen the position of the assessee, the latter can
acquire no right;
review may be a purely departmental matter of which the assessee knows nothing.
If on the other hand the Commissioner acts at the invitation of the assessee
and again does nothing to worsen his position, there is no justification for
giving him a new right of appeal. He has a specific right of appeal against the
assessment or order of the subordinate officer, which is subject to its own
(1880) 5 AC 214 390 That he cannot enlarge by taking a course which is on his
part purely voluntary. This view of the section is confirmed by the
High Court of Andhra pradesh had occasion to consider the scope of Section 20
of the Act in two of its judgments.
Bheemalingam, in re4 the assessee had sought to file an appeal to the High
Court under Section 23 of the Act against the order of the Board of Revenue (at
that time the revisional power was exercised by the Board of Revenue) revising
the assessment under Section 20(1) of the Act, which the Board had rejected as
being not maintainable. The High Court upheld the order of the Board of Revenue
holding that Section 20(1) of the Act does not provide a right of revision at
the instance of the assessee, but only provides suo motu power of revision to
the Commissioner and under Section 23(1) [sic 22(1)] a revision does lie to the
High Court against the order passed by the Board. Therefore, the appeals were
held not maintainable. The same view was reiterated in Sree Ramachandra Ginning
& Oil Mills v. State of A.P.5 It must therefore, be held that the validity
of an assessment order must be tested in an appeal or revision filed by an assessee
as provided for in the Act and in no other way. The assessee cannot invoke the suo
motu power of the authorities under Section 20. Any order validly made does not
become void or illegal by subsequent declaration of law. The suo motu power was
conferred on higher authorities to correct errors of law or to correct improper
or irregular procedure or illegality in the procedure, to safeguard the
interest of the Revenue, as there was no express power given to the State, to
file an appeal against order of assessment.
Tribunal had placed reliance on the decision of another Division Bench reported
in State of A.P. v. Lalitha Oil Mills'. In that case
following the decision of this Court in Sri Venkateswara Rice, Ginning and
Groundnut Oil Mill Contractors Co. v. State of A.P.7 the Commissioner
exercising suo motu power under Section 20(1) had revised the assessment made
in accordance with the law laid down by this Court. It was not a case where the
Commissioner had exercised the power at the instance of an assessee. The
Tribunal had wrongly held that the Commissioner could exercise the revisional
power at the instance of the assessee under Section 20(1) and (2) of the Act.
have, therefore, no hesitation to hold that the High Court has committed an
error in rejecting the revision by the State. Accordingly we hold that the
aggrieved assessee has only to pursue the remedies provided in the Act and he
has no right to make an application under Section 20 of the Act seeking
revision of the orders of assessments made under the Act by original
authorities. The appeals are accordingly allowed. The orders of the High Court
and STAT are set aside and the orders of the Dy. Commissioner are recorded. But
in the circumstances, there shall be no order as to costs.