Commercial Tax Officer Vs. M/S Rijhumal Jeevandas  INSC 274 (15 April
the consent of counsel appearing for the parties, the matters are heard for
final disposal. By this judgment we will dispose of all the aforenoticed
appeals as common question of law on somewhat similar facts arises for
consideration of this Court in all these appeals. However, for the purpose of
brevity and to avoid repetition of facts, we would be referring to the facts of
SLP (C) No. 11103 of 2009.
these afore noticed appeals, though refer to different respondents, all being
timber merchants but the principal question raised in all these appeals is
identical, whether the `ballies' can fall under the expression `timber' so as
to justify levying of higher sales tax.
Rijhumal Jeevandas (hereinafter referred to as `the assessee') is a concern,
trading in `timber' and its allied products. The Assessing Officer vide his
Order dated 17th November, 2000, passed an order of assessment against the
assessee wherein he levied tax at the rate of 8% i.e. Rs. 5,75,580/- on the
`ballies' which, according to the Department, comes within the category of
`timber' and thus, the tax ought to have been levied at the rate of 12%. On
this premise, a notice was issued by the authority for amending the assessing
order under Section 37 of the Rajasthan Sales Tax Act, 1994 (for short `the
Act'). Despite service of notice, none had appeared on behalf of the assessee
and the differential tax at the rate of 4% was levied totaling to Rs. 23,023/-.
Further, the authorities imposed surcharge of Rs.
and interest of Rs. 26,302/-, and raised a total further demand of Rs.
Against the aforesaid order of assessment, the assessee preferred an appeal
before the Deputy Commissioner (Appeals), Commercial Tax Department, Kota. The
main argument raised was that the order was beyond the purview and scope of
Section 37 of the Act. The `ballies' could not be treated to be covered under
the head `timber' and, as such, the entire demand was vitiated in law.
aforesaid appeal was allowed. The appellate authority found that, the `ballies'
comes under the category of `goods' and not under the category of `building
goods'. Thus, the differential tax levied by the Tax Assessment Officer,
assuming `ballies' to be `timber' was not justified. Consequently, the entire
demand itself was set aside.
order of the appellate authority dated 18th October, 2006 was challenged by the
Assistant Commercial Taxes Officer, Ward -III, Circle-B, Kota, before Rajasthan
Tax Board, Ajmer which vide its 6 judgment dated 11th June, 2007 found that the
`ballies' are not `timber' and upheld the view taken by the First Appellate
Authority and dismissed the appeals preferred by the Department.
by the Order of the Rajasthan Tax Board, Ajmer the Department preferred a
revision under Section 86 of the Act and besides referring to the facts, the
following questions of law were framed for consideration of the High Court :
Whether in the facts and circumstances of the matter the order passed by the
assessing authority was in any manner inappropriate for the purpose of
interference by the appellate authorities ? (ii) Whether the Appellate
Authorities were justified in interfering with the orders passed by the
assessing authority which related to appreciation of entire record and facts ?
(iii) Whether the appellate authorities justifies in drawing the wrong
conclusion while misinterpreting the provisions of the Section 37 of the Act of
1994 which relates to rectification of an order ? (iv) Whether the goods/good
used and dealt with by the respondent assesses could be classified as not
timber so as to enable the respondent assesses to pay tax @ 8% while bally
comes in the category of timber wood and upon which the tax is payable @
revision petition came to be dismissed by the High Court vide its Order dated
7th July, 2008. The said Order reads as under :
having carefully gone through material on record, since after due consideration
proper discretion has already been used by the Deputy Commissioner (Appeals) as
also the Rajasthan Tax Board, in the facts and circumstances, no further
interference is called for by this Court.
revision petition is dismissed accordingly as having no merits."
present appeals had been preferred by the Department against the order dated
7th July, 2008 passed by the High Court. The primary challenge, to the legality
and correctness of the order, is that there is no discussion either on the
facts or on the questions of law raised in the revision petition before the
High Court and in the argument addressed during the time of hearing of the
some regret, we are constrained to notice that the cryptic orders like the
above, have not only been passed in the present appeals, but identical orders
had even been passed by the High 8 Court in large number of cases from which
the appeals have been preferred before this Court. Identical orders, though in
different revision petitions dealing with different facts, parties and
questions of law, running into 4 lines, like the present one, have been passed,
even without variation of a coma or a full stop. It also needs to be noticed
that the grounds raised by the Department before us cannot be said to be
frivolous or untenable which required discussion by the High Court. The orders,
besides being cryptic, suffer from basic infirmity of non application of mind
and non-speaking orders in law. This ground need not detain us any further as
even in other cases where identical orders were passed, this Court had the
occasion to consider the same grounds at some length. Reference, in this
regard, can be made to the judgment of the date, the Bench, in the case of
Assistant Commissioner v. M/s Shukla & Brothers (SLP (C) No. 16466 of 2009)
decided on the same day, where after discussing the law at some length, the
order passed by the High Court was set aside and the case was remanded to the
High Court for hearing the case de novo and passing of an order in accordance
with law afresh.
view of the ratio of the case of M/s. Shukla & Brothers (supra), which is
squarely applicable on the fact and law to the present case, we are constrained
to set aside the order passed by the High Court and remand the matter to the
High Court for hearing the case de novo. We are compelled to make this
direction as it was expected of the High Court to consider the question of law
raised before it and express its own opinion/reasons.
the reasons stated above and the reasons recorded in the case of M/s. Shukla
& Brothers (supra), we hereby set aside the impugned orders of the High
Court and remand the matters to the High Court for hearing the same de novo and
pass orders in accordance with law. However, in the facts and circumstances of
the case, there shall be no order as to costs.
extent the appeals are allowed.
........................................J. [ S.H. KAPADIA ]