Commissioner
of Sales Tax Orissa & ANR V. M/S. Halari Store [1997] INSC 750 (26
September 1997)
S.P.
BHARUCHA, V.N. KHARE
ACT:
HEADNOTE:
THE
26TH DAY OF SEPTEMBER, 1997 Present:
Hon'ble
Mr. Justice S.P. Bharucha Hon'ble Mr. Justice V.N. Khare A.B.Diwan, Sr. adv.,
and P.N. Misra, Adv. with him for the appellants Raju Ramachandran, Sr.Adv., Sanjeev
Das, Rajesh, P.K. Mullick and Gaurab Banerjee, Advs. with him for the
Respondents
The
following Judgment of the Court was delivered:
V.N.
KHARE, J.
Leave
granted in all the matters.
These
appeals by special leave, raise the question "whether the Commissioner of
Sales Tax, suo motu can revise under clause (a) of Sub-section (4) of Section
23 of the Orissa Sales Tax Act (in short "the Act") read with rule 80
of the Orissa Sales Tax Rules (in short "the Rules"), an appellate
order passed by the Assistant Commissioner of Sales Tax." The respondent
herein is a registered dealer under the Act and running a wholesale business in
purchase and sale of beetle nuts at malgodown, Cuttack. In pursuance to the notices issued under Section 12(4) of
the Act, the respondent appeared before the concerned Sales Tax Officer and
produced the books of accounts for the relevant assessment years for
verification. The Sales Tax officer rejected the books of accounts produced by
the respondent- dealer and completed the assessments to the best of his
judgment. Feeling aggrieved by the same, the respondent- dealer preferred
appeals before the first appellate authority, namely, the Assistant Commissioner
of Sales Tax, Cuttack, under Section 23(1) of the Act.
The appellate authority by its orders allowed the appeals in part for the
assessment year 1992-93 and in full for the assessment year 1993-94.
Thereafter, the Additional Commissioner of Sales Tax, exercising his suo motu revisional
power conferred under Section 23(4)(a) of the Act read with rule 80 of the
Rules, issued notices dated 9.6.1995 to the respondent- dealer to show cause as
to why should the appellate orders passed by the Assistant Commissioner of
Sales Tax be not revised, the same being erroneous and prejudicial to the
interest of the Revenue. It is at this stage, the respondent-dealer challenged
the said notices by means of writ petitions under Article 226 and 227 of the
Constitution of India before the High Court of Office. The contention of the
respondent dealer before the High Court was that the Commissioner of Sales Tax
has no jurisdiction to issue the impugned notices. The High Court quashed the eimpugned
notices and allowed the Original Jurisdiction Cases No. 4496 and 4497 of 1995. want
of jurisdiction in Additional Commissioner of Sales Tax in issuing the impugned
notices to the respondent dealer was found by the High Court on two grounds.
Firstly, the appellate order passed by the Assistant Commissioner of Sales Tax
was not an order within the meaning of expression "order made under this
Act" occurring in clause (a) of sub-section (4) of Section (4) (a) of
Section 23 places a limitation on the exercise of revisional power by the
Commissioner when it concerns an appellate order.
Before
we advert to the reasonings given by the High Court in allowing the writ
petition, it is appropriate to notice the decision of this Court in the case of
State of Orissa and others vs. Krishna Stores, [1997(3) SCC 246], wherein this
court was called upon to interpret clause (a) of the subject matter for
consideration before us, and unamended rule 80 of the Rules. In that case a
dealer successfully challenged the notice issued to him under Section 23(4)(a)
of the Act read with unamended rule 80 of the Rules before the High Court of Orrisa
on the ground that issue of notice to revise an appellate order is without
jurisdiction. This Court while interpreting Section 23(4)(a) of the Act was of
the view that, in the context of Section 23(4) where the words "other than
an appellate order" are absent, there is no limitation on the power of the
Commissioner exercising suo motu power as to revise an appellate order. This
Court held thus:- "under Section 23(4) the Commissioner can, inter alia,
on his own motion revise any order made under this act or the Rules by any
person other than a tribunal or an additional tribunal. Therefore, under this
sub-section the Commissioner is not expressly prevented from revising is not
expressly prevented from revising an appellate order if made by any person
other than the tribunal or an additional tribunal".
In
that case, the unamended rule 80 also fell for consideration. The unamended
rule 80 as it stood then, is extracted below:- "80. The Commissioner may
of his own motion, at any time within three years from the date of passing of
any order by the Assistant Sales Tax Officer or by the Sales Tax Officer and
within two years from the date of passing of any order other than an appellate
order by the Additional Commissioner, Deputy Commissioner or the Assistant
Commissioner, as the case may be, call for the record of the proceedings in
which such order was passed and revise any such order." (emphasis
supplied) Interpreting the unamended rule 80, this Court observed that the
Commissioner is empowered to revise any order other than an appellate order
passed by the Additional Commissioner, Deputy Commissioner or the Assistant
Commissioner. The said view of this Court was on account of the language used
in the unamended rule to which expressly prohibited the revision of an
appellate order. however, this Court upheld the exercise of suo motu power of
revision by the Commissioner on the ground that the appeal filed by the dealer
was rejected at the threshold due to certain defects in the appeal.
Subsequently,
rule 80 which was the subject matter of interpretation in the case of State of Orissa
v. Krishna Stores (supra) was amended, and the amended rule 80 is reproduced
below:- "80, Revision by the Commissioner suo motu.
The
Commissioner may on his own motion at any time within three years from the date
of passing of any order by the Sales Tax Officer or within two years from the
date Officer or within two years from the date of passing of any order by the
Additional Commissioner, Special Additional Commissioner or Assistant
Commissioner, as the case may be, call for records of the proceedings in which
such order was passed and if he considers that any order passed therein is
erroneous in so far as revenue he may after giving the dealer an opportunity of
being heard and after making or causing to be made such enquiry as he deems
necessary revise any such order :
Provided
that the Commissioner shall not revise any order under this rule- (1) where an
appeal against the order is pending before the appellate authority under S. 23,
or (2) where time-limit for filling an appeal under S. 23 has not
expired." In view of deletion of words "other than an appellate
order" in the amended rule, there is no manner of doubt that under Section
23(4)(a), read with amended rule 80, the Commissioner has suo motu power to
revise an appellate order. The decision in the case of State of Orrisa vs. Krishna Stores (supra) read
with amended rule 80, substantially resolves the controversy as regards the
Commissioner exercising suo motu power of revision as to revise under Section
23(4) (a) of the Act read with rule 80 of the Rules, an appellate order.
Adverting
to the first reasoning given by the High Court that the appellate order does
not fall within the meaning of the expression "order made under the
Act" occurring in clause (a) of sub-section (4) of Section 23 of the Act,
it is necessary to set out the provisions of the Act which are extracted below:
"23.
Appeals and revision.
(2)
Within thirty days from he date of receipt of the copy of- (a) an order of
assessment with or without penalty under S. 12, 12-A or 12-B; or (b) an order
directing payment of interest under sub.S. (4-a) of S. 12; or (c) an order
imposing penalty under sub-S.(3) of S.9-B or under sub-S.
(3) of
S. 11, any dealer or person, as the case may be, may, in the prescribed manner
appeal to the prescribed authority against such order:
Provided
that no appeal shall be entertained by the said authority unless he is
satisfied that such amount of tax as the appellant may admit to be due from him
has been paid;
Provided
further that the prescribed authority may admit the appeal after the period
herein before specified if it is satisfied that the appellant had sufficient
cause for not preferring the appeal within the said period.
(2)
Subject to such rules as may be made or procedure as may be prescribed, the
appellate authority, in disposing of any appeal under sub.S(1), may- (a)
confirm, reduce, enhance or annual the assessment or the penalty or interest,
if any; or (b) set aside the assessment or the penalty or interest, if any, and
direct the assessing authority to pass a fresh order after such further enquiry
as may be directed.
(3)
(a) Any dealer, or as the case may be, the State Government, dissatisfied with
an appellate order made under sub.S.(2) may within sixty days from the date of
receipt of such order prefer an appeal in the prescribed manner to the Tribunal
against such order :
Provided
that an appeal under this clause may be admitted after the aforesaid period o
limitation, if the Tribunal is satisfied that the appellant had sufficient
cause for not preferring the appeal within such period.
(b)
The dealer, or the State Government as the case may be on receipt of notice
that an appeal has been preferred under C1.(a) may notwithstanding that the
said dealer or the State Government may not have appealed against such order or
any part thereof, within sixty days of the service of the notice file a
memorandum of cross objections and such memorandum shall be disposed of by the
Tribunal as if it were an appeal presented within time under C1.(a).
(c)
While disposing of an appeal under this sub-section the Tribunal shall have the
same powers subject to the same conditions as are enumerated in sub.S.(2) and
any order passed under this sub-section shall, except as otherwise provided in
S. 24, be final.
(4)
(a) Subject to such rules as may be made and for reasons to be Commissioner
may, upon application by a dealer or person or on his own motion revise any
order made under this Act or the rules made thereunder by any person other than
the Tribunal appointed under sub-S.
(3) of
S. 3 to assist him:
Provided
that the Commissioner shall not entertain any such application for revision if
the dealer or the persons filing the same having a remedy by way of appeal
under sub-S. (3) did not avail of such remedy or the application is not filed
within the prescribed period.
Explanation.
Any provision contained elsewhere in this Act which provides for determination
of any specific matter shall not debar the Commissioner from determining such
matter in exercise of the powers conferred upon him under this sub-section.
A
perusal of the aforesaid provisions shows that Section 23 of the Act deals with
appeals and revision. Sub- section (i) thereof provides that any dealer or
person may prefer an appeal against the order of assessment or an order
directing payment of interest or an order imposing penalty.
Sub-section
(2) of Section 23 deals with power of appellate authority in disposing of
appeals preferred under sub- section (1). Sub-section (3)(a) deals with second
appeal which enables any dealer or State Government, as the case may be, to
prefer appeal to the State Sales Tax Tribunal against the appellate order.
Section 23(4)(a) deals with the revisional power of the Commissioner of Sales
Tax, which may be either suo motu or at the instance of a dealer or person
against y order passed under the Act. The question, therefore, which requires
consideration is whether an appellate order passed under sub-section (2) of
Section 23 of the Act comes within the ambit of the expression "any order
made under the Act" occurring in Section 23(4)(a) of the Act. The language
used in Section 23(4)(a) is plain, simple and there is no ambiguity in it. A
plain reading of Section 23(4)(a) Shows that the expression "any order
made under the Act" is of a wise connotation and it includes an assessment
order as well as an appellate order passed under the Act. This construction placed
on the said expression neither runs contrary to the scheme envisaged in Section
23 of the Act nor it leads to any undesirable consequences, as observed by the
High Court. We are, therefore, of the opinion that under Section 23(4)(a) of
the Act, the Commissioner on his own motion can revise any order, including an
appellate order made under the Act or the Rules by a person other than the
tribunal or additional tribunal.
So far
as the second reasoning given by the High Court that the proviso to clause (a)
of sub-section (4) of Section 23 of the Act places limitation on the
Commissioner's suo motu revisional powers to revise an appellate order is
concerned, a reading of the aforesaid proviso would show that the limitation on
the revisional power of the Commissioner comes is only where a dealer or person
filing the revision having a remedy by way of appeal under sub- section (3) of
Section 23 or the Act, did not avail of such remedy. However, it does not
curtail the suo motu revisional power of the Commissioner of Sales Tax to
revise an appellate order passed under the act. The proviso to Section 23(4)(a)
contemplates that the Commissioner shall note exercise any revisional
jurisdiction at the instance of a dealer or person when he has a remedy by way
of an appeal under sub-section (3) of Section 23 of the act. Thus, the
Commissioner is not required to entertain an application under Section 23(4)(a)
of the Act if the dealer of person instead of filing an appeal before the
appellate authority has invoked revisional jurisdiction of the Commissioner.
But,
the same is not the position where the Commissioner decides to exercise his suo
motu revisional power to revise an appellate order. Significantly, the words
"on his own motion" occurring in the enactment are conspicuously
absent in the proviso. Normally, a proviso is enacted o carve out something
special out of the general enactment or to qualify what is in the enactment. By
enacting the proviso the legislature has excluded the revisional jurisdiction of
the Commissioner Sales Tax to revise an appellate order if invoked at the
instance of a dealer or person when such dealer or person has a remedy by way
of an appeal. As noticed earlier, the limitation on the suo motu power of the
Commissioner as to revise an appellate order has not been expressly provided in
the proviso. In absence of any expressed provisions, no limitation on suo motu
power of the Commissioner to revise an appellate order can be implied.
We,
accordingly hold that the provisions of proviso to sub- section (4)(a) of
Section 23 of the act do not prohibit the Commissioner to exercise suo motu revisional
power to revise an appellate order.
For
the foregoing reasons, we are satisfied that the High Court fell in error in
quashing the impugned notices and allowing the writ petition of the respondent
herein. We accordingly set aside the order and judgment of the High Court dated
12.2.1996 in O.J.C.. Nos. 4496 & 4497/95 and allow the appeals. There shall
be no order as to costs.
In
view of the decision in Civil Appeal Nos......of 1997 (arising out of S.L.P.(C)
No. 23581 and 23972/1996) are also allowed, with no order as to costs.
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