L. Palamalai, (Administrative Member) -
(1.) THE prayer in this original petition is to quash the proceedings in C.T.M.P. No. 16 of 1999 in C.T.A. No. 549 of 1995 dated May 17, 1999 and to direct the Sales Tax Appellate Tribunal (Additional Bench), Coimbatore, to admit the petition under Section 55 of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as "the Act") and to grant relief as prayed for therein. The facts leading to the present petition are as follows :
The assessing authority determined the total and taxable turnover of the petitioner -company for the assessment year 1992 -93 on a total and taxable turnover of Rs. 5,03,57,510 and Rs. 20,57,260 respectively in the assessment order passed in TNGST 311244/92 -93 dated January 10, 1994, While making the assessment, the officer allowed exemption on the claim of second sales of voltage stabilizers purchased from the Congregation of Sisters of Cross of Chavanad near Trichy among other items. Subsequently, the officer resorted to revision under Section 16(1)(a) of the Act by disallowing the exemption already granted on a turnover of Rs. 59,74,045 relating to second sales of voltage stabilizers which were purchased from the Congregation of Sisters of Cross of Chavanad near Trichy whose first sales were exempted from tax under the Act as per G.O. No. 61 (CT & RE) dated February 13, 1992. The appeal preferred was dismissed by the first appellate authority and in the second appeal also the claim of exemption was negatived in the order passed by the Sales Tax Appellate Tribunal in C.T.A. No. 541 of 1995 dated October 6, 1997 relying on the decision of the Madras High Court in the case of Vasu General Traders reported in  66 STC 358. However, in respect of an identical issue for the assessment year 1993 -94, the claim of exemption was allowed by the Appellate Tribunal in C.T.A. No. 169 of 1996 dated September 25, 1998 by following ratio of the decision of the Supreme Court in Civil Appeal Nos. 4976 - -4979 of 1994 dated April 22, 1998 (Shanmuga Traders v. State of Tamil Nadu  114 STC 1). On receipt of the appellate orders in C.T.A. No. 169 of 1996 dated September 25,1998, the assessee filed a petition under Section 55 of the Act in C.T.M.P. No, 16 of 1999 with a request to grant exemption on second sales of voltage stabilizers on a turnover of Rs. 59,74,045 in the year 1992 -93 by amending the order in C.T.A. No. 541 of 1995 dated October 6, 1997. However, the Appellate Tribunal dismissed the petition filed under Section 55 of the Act by holding that a subsequent decision cannot be a ground to invoke Section 55 of the Act by relying on a decision of the Madras High Court reported in  83 STC 520 (State of Tamil Nadu v. Sree Gounder & Co.). The present petition is against the order of the Sales Tax Appellate Tribunal to rectify the order under Section 55 of the Act.
(2.) MR . M.S. Gurusamy, the learned counsel for the petitioner, contended that the Appellate Tribunal is bound to rectify an error apparent on the face of the record if a petition is presented within five years from the date of order passed by it as contemplated in Section 55 of the Act. As per this section, a mistake either on fact or law glaring and obvious from the record itself, capable of identification without a detailed investigation or enquiry or elaborate arguments, in regard to which there could reasonably be no two opinions, is a mistake apparent from the record and this patent and obvious mistake is curable as contemplated in the decision reported in  94 STC 234 (Ker) (Arts and Cini House v. Sales Tax Officer). The order if found to be erroneous by applying a subsequent decision of the Supreme Court or concerned High Court as held in the decision of the Karnataka High Court in  93 STC 464 [Mysore Cements Limited v. Deputy Commissioner of Commercial Taxes (Assessment -V)], it could be rectified. Therefore following the ratio of the Supreme Court's decision in the case of Shanmuga Traders v. State of Tamil Nadu reported in  114 STC 1, the Appellate Tribunal ought to have rectified the mistake apparent on the face of record having regard to the fact that the law declared by the Supreme Court is effective from the date of the provision itself. As reported in  100 STC 241 (Mad.) [Meco Tranica Private Ltd. v. Assistant Commissioner (Commercial Taxes)] when the Legislature altered the rate of tax retrospectively, it was held that an assessment order passed could be rectified as a mistake apparent on the face of record. Therefore, the reliance placed on the decision of the Madras High Court reported in  83 STC 520 (State of Tamil Nadu v. Sree Gounder & Co.) which related to the powers of review is not relevant when the petition applied for rectification under Section 55 of the Act. Therefore, the Appellate Tribunal is not right in dismissing the petition under Section 55 of the Act and therefore the order of the Appellate Tribunal is to be set aside with a direction to the Appellate Tribunal to take on file the petition and dispose it of, having regard to the decision of the Supreme Court in  114 STC 1 (Shanmuga Traders v. State of Tamil Nadu). Mr. R. Mahadevan, the learned Government Advocate, contended that the Appellate Tribunal has given clear reasons in the order passed to reject a petition filed for rectification under Section 55 of the Act. When an order is passed under Section 55 of the Act negativing the request of the petitioner, then no revision lies to the Special Tribunal against the rejected petition.
(3.) WE have considered the contentions carefully and perused the records. A rectification is undertaken only when there are glaring errors of fact or law in the order which do not require fresh investigation into facts or detailed arguments to establish the point of law as held in T.S. Balaram, Income -tax Officer v. Volkart Brothers  : 82 ITR 50 (SC). As held in Mittal Engineering Works (P) Ltd. v. Collector of Central Excise  106 STC 201 (SC) at page 205 "a decision cannot be relied upon in support of a proposition that it did not decide". As held by the Supreme Court in Shree Bhagwati Roller Flour Mills v. Commissioner of Sales (Trade) Tax reported in  108 STC 157, a Tribunal while exercising its power for rectification of an error apparent on record cannot revise its order altogether on a highly disputed question of law. Thus, in the present case, the petitioner relied on the decision reported in Shanmuga Traders v. State of Tamil Nadu reported in  114 STC 1 (SC) for the proposition that the Appellate Tribunal can rectify the order passed earlier on October 6, 1997 on the basis of the law declared by the Supreme Court in the decision reported in  114 STC 1 (Shanmuga Traders v. State of Tamil Nadu). On perusing the decision of the Supreme Court, we find that in regard to Vasu General Traders v. State of Tamil Nadu  66 STC 358 (Mad.) the Supreme Court has observed as follows :
"The case of Vasu General Traders  66 STC 358 (Mad.) did not deal with declared goods. It dealt with handmade matches which were covered by an exemption notification. The petitioner before the High Court had purchased matches from a manufacturer who was covered by that exemption notification. The petitioner contended that the point of levy being the first sale in the State and the first sale having been exempted from payment of tax, there was no tax liability in respect of subsequent sales of the same goods. The High Court rejected the contention on the ground that the specific exemption would then get converted into a general exemption. It said :
'As we have already held, that the exemption in relation to a particular sale will not be available to other subsequent sales, the taxing statute has to operate in respect of other sales, and the petitioner's sale becomes taxable being the first taxable sale inside the State'."
Thereafter reverting to the case on hand, the Supreme Court observed as follows :
"The goods with which we are concerned being declared goods, they can only be taxed at a single point ; that is, only one sale in the State can be subjected to tax. It is for the State to determine whether the single point should be the point of first sale in the State or the last sale in the State or any intermediate sale in the State. If the single point is fixed by the State at, say, the point of first sale and the State exempts the first sale from payment of tax, either by a general provision or a specific provision applicable to a class of seller, a particular seller or the goods sold may not be subjected to tax at either that point of first sale or any subsequent sale in the State.
13. The Second Schedule of the State Act specifies the single point ; it is 'the point of first sale in the State'. The first sale in the State was the sale by the said Board to the appellants/petitioners. That sale was exempt from tax by reason of the notification dated December 1, 1982 aforementioned. The iron and steel sold by the said Board to the appellants/petitioners was, therefore, not liable to tax either at the point of first sale or any subsequent sale in the State.
14. There is no warrant for the emphasis that would appear to have been placed by the Madras High Court on the phrase 'taxable sale'. The State Act does not fix the single point of the levy at the first taxable sale ; it fixes it at 'the point of first sale'. The impugned circular cannot validly shift the point of levy from the first sale to a subsequent sale and it is, therefore, bad in law.";