STATE OF PUNJAB Vs. ASSESSING AUTHORITY CHANDIGARH
LAWS(SC)-1990-11-5
SUPREME COURT OF INDIA (FROM: PUNJAB & HARYANA)
Decided on November 09,1990

STATE OF PUNJAB Appellant
VERSUS
ASSESSING AUTHORITY Respondents


Referred Judgements :-

GOVERNMENT MEDICAL STORE DEPOT KARNAL VS. STATE OF HARYANA [REFERRED TO]



Cited Judgements :-

COMMISSIONER OF SALES TAX VS. HUKUMCHAND MILLS LTD [LAWS(MPH)-1995-12-7] [REFERRED TO]
GUJARAT SHIP BREAKERS ASSOCIATION VS. STATE OF GUJARAT [LAWS(GJH)-2014-3-100] [REFERRED TO]
STATE OF TAMIL NADU VS. BOARD OF TRUSTEE OF THE PORT OF MADRAS [LAWS(SC)-1999-3-65] [REFERRED]


JUDGEMENT

- (1.)T:- The Hospitality Organisation, Punjab was running canteens at various places and it was assessed to sales tax for the assessment year 1963-64. This assessment was confirmed by the Deputy Excise and Taxation Commissioner on first appeal and then by the Sales Tax Tribunal, Chandigarh on second appeal. The assessment was levied under the Punjab General Sales Tax Act, 1948 (hereinafter called 'the Act). The tribunal held that the activity of manufacture of goods for sale by the Hospitality Organisation was a business and that it had been correctly held to be a 'dealer' within the meaning of the said Act. An application was made to the Tribunal to refer two questions of law said to arise out of the order of the Tribunal for the decision of the High Court. These questions were:-
1. Whether the directions of the Union of India contained in Memo.No. F. 121(5)-B/66 Vol. II dated 7-3-1990 bars the assessment and recovery of the Sales Tax in the present case

2. Whether the Hospitality Organisation is a dealer within the meaning of section 2 (d) of the Punjab Sales Tax Act

The Tribunal dismissed this application.

(2.)When the matter came to the High Court under S. 22(2) of the Punjab General Sales Tax Act seeking a direction to the Tribunal to refer the two questions earlier set out for the decision of the Court disposed of the petition on a totally new ground. It will be noticed that the Hospitality Organisation was a department of the State Government of Punjab, whereas the taxing authority was the Union Territory of Chandigarh. In the view of the High Court, the dispute being one between two State Governments, the petition filed before it was not maintainable as such a dispute can be adjudicated upon only by the Supreme Court under Art. 131 of the Constitution. The High Court, referred, in its order, to the decision of a Division Bench of the High Court in Govt. Medical Store Depot, Karnal v. State of Haryana, AIR 1972 Punj and Har 287.
(3.)The State of Punjab has preferred this appeal on behalf of the Hospitality Organisation. We are of the opinion that the High Court erred in disposing of the petition before it on the ground mentioned in the judgment which had not been before, or considered by the sales tax authorities and the Tribunal. The, application filed before it was one under S. 22(2) (b) of the Punjab General Sales Tax Act. Its scope was limited to examining whether any question of law arose out of the order of the Sales Tax Tribunal or not. In our opinion, a question of law did arise out of the order of the Tribunal as to whether the Hospitality Organisation had been rightly treated as a 'dealer' within the meaning of S. 2(d) of the Act. In our opinion, therefore, the High Court should have called for a reference from the Tribunal on the questions sought for by the appellant.
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