M. C. JAIN, J. - (1.) THIS revision is directed against the order of the Board of Revenue dated 15th February, 1975, whereby the learned Division Bench of the Board of Revenue dismissed the special appeal of the Revenue against the decision of the single Member of the Board of Revenue dated 30th April, 1974, whereby the revision of the assessee was accepted and the orders of the assessing authority and of the Deputy Commissioner (Appeals) were set aside and a further direction was given for refund of the penalty if recovered from the assessee. A short question arises for decision in this revision petition. Penalty proceedings were initiated against the assessee under section 16 (1) (c) of the Rajasthan Sales Tax Act, 1954. The assessing authority imposed the penalty which order was upheld in appeal by the Deputy Commissioner (Appeals ). The assessee went in revision before the Board of Revenue and contended that the order of imposition of penalty was earlier annulled or set aside by the Deputy Commissioner (Appeals) and a further direction was given that the amount of penalty be refunded to the assessee, and that order was passed on 21st June, 1971. According to the assessee that order became final and it was no longer open to the assessing authority to initiate fresh proceedings after service of notice regarding imposition of penalty. It may be mentioned here that the orders of imposing penalty by the assessing authority and Deputy Commissioner (Appeals) were set aside by the learned Member of the Board of Revenue on 30th April, 1974, on the basis that the order of the Deputy Commissioner (Appeals) setting aside penalty and ordering refund was final and, therefore, proceedings could not be initiated for imposition of penalty. THIS order of the learned Member of the Board of Revenue was upheld in the special appeal. It is not in dispute that the Deputy Commissioner (Appeals) set aside the order of imposition of penalty on the ground that the proceedings were not initiated after due notice to the assessee as required under the law and the order was not passed on merits. However it was clearly directed that the amount of penalty shall be refunded to the assessee.
(2.) SHRI G. S. Bafna, learned counsel appearing for the Revenue, submitted that the order of the Deputy Commissioner (Appeals) was not an order on merits but an order on technical ground, i. e. , the order of imposition of penalty was set aside on the ground of want of notice and so fresh proceedings could be legitimately initiated by the assessing authority after observance of the procedural provisions of notice to the assessee for imposition of penalty and he referred to a decision of the Supreme Court in Superintendent (Tech. I), Central Excise v. Pratap Rai AIR 1978 SC 1244. He also placed reliance on a decision of the Andhra Pradesh High Court in Thimmasamudram Tobacco Co. v. Asst. Collector of Central Excise AIR 1961 AP 324. In the Supreme Court decision the order of the Assistant Collector, Excise, was vacated by the Appellate Collector on the ground of non-observance of principles of natural justice and the order was passed without prejudice and consequential order of refund of excise duty was not passed. Their Lordships of the Supreme Court observed that on a careful consideration of the facts and circumstances of the present case where an order passed in appeal vacates the order of the first Tribunal on purely technical grounds and expressly states that it was being passed without prejudice which means an order not on the merits of the case, such an order does not debar fresh adjudicatory proceedings which may be justified under the law. It is necessary for the court interpreting an order of this kind to give full and complete effect to the exact words used by the authorities and not to draw a sweeping conclusion merely from the fact that no explicit direction has been made by the appellate authority. It may be mentioned that the decision turns on the interpretation which flows from the order passed by the Appellate Collector and their Lordships clearly noticed the use of the expression "without prejudice" and that the order was wanting in respect of refund of the amount of penalty and release of property confiscated. In the given facts their Lordships were of the opinion that the Assistant Collector was justified in commencing fresh adjudication proceedings. In the Andhra Pradesh case as well the appellate order had set aside the order of the Assistant Collector on account of non-observance of certain procedural provisions. No consequential order was passed by the appellate authority and it was observed that where the flaw in the order appealed against consists in the non-observance of certain procedure or in not giving effect to the maxim audi alteram partem, it is open to the officer concerned to start the procedure once again with a view to follow the rules of procedure and the principles of natural justice. So far as the present case is concerned the mind of the appellate authority can be known from the direction given by the appellate authority for refund of the amount of penalty recovered from the assessee. A clear direction was given in this regard while setting aside the order of imposition of penalty. It is true that the decision was not given on merits. The decision was rendered on account of non-observance of procedural provisions regarding issue of notice for imposition of penalty. If the appellate authority would have intended that fresh proceedings are to be initiated, in my opinion, the appellate authority would not have directed the refund of the amount of penalty; such a direction shows the clear mind and intention of the appellate authority. If the appellate authority had intended that fresh proceedings are to be initiated, it could have easily observed that the assessing authority would be free to initiate fresh proceedings after issuance of notice but such a direction has not been given. That shows that the order of imposition of penalty has set aside once for all and the amount of penalty has to be refunded. Shri N. M. Ranka, learned counsel for the respondent, referred to the provisions contained in section 13 (3) and (4) of the Rajasthan Sales Tax Act, which deal with the provisions relating to appeal. Sub-section (3) and sub-section (4) of section 13 read as under : " 13 (3) The appellate authority may, before disposing of any appeal, make such further inquiry as it thinks fit, or may direct the assessing authority or the officer against whose order appeal has been preferred to make further inquiry and report the result of the same to the appellate authority; and in disposing of the appeal, the appellate authority may - (a) in the case of an order of assessment or penalty - (i) confirm, reduce, enhance or annual the assessment or penalty, or (ii) set aside the assessment or penalty and direct the assessing authority to pass a fresh order after such further inquiry as may be directed; (b) in the case of any other order, confirm, cancel or vary such order. (4) Every order passed in appeal under this section shall, subject to the powers of revision conferred by section 14 and of any reference made to the High Court under section 15, be final. " What orders can be passed in appeal by the appellate authority can be read in clauses (a) and (b) of sub-section (3) of section 13. Sub-clause (i) of clause (a) confers power of confirmation, reduction, enhancement or annulment of assessment or penalty and sub-clause (ii) of clause (a) confers the power of setting aside the assessment or penalty and further directing the assessing authority to pass a fresh order after such further inquiry as may be directed. Clause (b) of sub-section (3) deals with the orders other than the order of assessment and penalty and in relation to such orders powers of confirmation, cancellation and variation vests in the appellate authority. According to Mr. N. M. Ranka, no direction for passing a fresh order was made by the appellate authority to the assessing authority. When this power has not been exercised by the appellate authority, then it should be taken that the appellate authority intended to make its order final, leaving it not open to be considered by the assessing authority to pass a fresh order after issuance of notice and he also referred to sub-section (4) of section 13 on the basis of which he submitted to reach to the conclusion that the order of the Deputy Commissioner (Appeals) has become final as that order was not challenged by way of revision by the Revenue. It may be stated that having regard to the nature of the provisions contained in sub-section (3) of section 13, it is always better that the appellate authority while exercising power in appeal should be specific as how and in what manner the power is being exercised and how the assessing authorities are required to act. Had there been any specific direction, the controversy of the nature which has arisen in the present matter would not have arisen. Be that as it may, what I got from the order of the Deputy Commissioner (Appeals) is that the intention of the appellate authority was clear that the question need not to reopened on issuance of fresh notice and the direction of refund of the amount can be read to mean that it was not open to the assessing authority to initiate fresh proceedings for imposition of penalty and I need not decide the question, in the above view of the matter, as to whether the same result can be reached on the basis of the order of appellate authority which became final under sub-section (4) of section 13. In the light of what I have considered above, this revision has no force, so it is hereby dismissed. Petition dismissed. .;