M.Y.EQBAL, J. - (1.) PETITIONER M/s. Metallurgical and Engineering Consultants (India) Limited has filed this application under Article 226 of the Constitution of India for declaration that the Commissioner of Commercial Taxes cannot call for and examine the record of any appellate proceeding for the purpose of satisfying himself as to the legality or proprietory of the appellate order in exercise of power vested under Section 46(4) of the Bihar Finance Act and further for quashing the entire revision proceeding in Revision Case No. C.C.(s) No. 500/98 -99 including the order dated 16.2.1999 passed by the Commissioner of Commercial Taxes, - Bihar, Patna for the period 1987 -98 by which he had initiated proceeding suo motu under Section 46(4) of the Act.
(2.) THE facts of the case lie in narrow compass: Petitioner is a Government of India Undertaking and registered dealer under the provisions of Bihar Finance Act, 1981 (in short Act of 1981) and also under Section 7 of the Central Sales Act, 1956 (in short Act of 1956). Petitioner filed return and the respondent No. 5 Deputy Commissioner, Commercial Taxes passed order dated 30.1.1996 both under the Act of 1981 and the Act of 1956. Under the Act of 1956, respondent No. 5 rejected the claim of the petitioner made under Sections 6(2) and 5(2) of the Central Act and raised demand. Similarly, in the State Act also the respondent No. 5 passed final order and raised demand. Aggrieved by the said orders, petitioner -assessee preferred appeal before the Joint Commissioner, Commercial Taxes (Appeals), Ranchi Division, Ranchi. It is stated that in the said appeals State of Bihar was the party -respondent represented by the Commissioner of Commercial Taxes. The aforesaid appeals were heard by the Joint Commissioner, Commercial Taxes and after hearing the petitioner and the respondents, passed final order and remanded the matter back to the Assessing Officer for passing fresh order of assessment for the year 1987 -88 under both the State Act and Central Act in terms of Order dated 27.2.1997. Petitioner's case was that the appellate order was duly communicated to the petitioner as well as Commissioner, Commercial Taxes and other authorities vide memo No. 354 dated 5.3.1997 for information. Petitioner's further case is that thereafter, on 25.4.1997 petitioner filed two separate application before the Deputy Commissioner, Commercial Taxes for refund of Sales -tax which was deposited on the condition of stay of the assessment order. In the meantime, pursuant to the appellate order dated 27.2.1997 the Deputy Commissioner of Commercial Taxes issued notice dated 13.6.1997 for production of papers and evidence for the year 1987 -88 and fixed 28.6.1997 as the date for the aforesaid purposes. However, when pursuant to the remand order, assessment proceedings were in progress before the Deputy Commissioner of Commercial Taxes, the Commissioner initiated proceeding for suo motu revision under Section 46(4) of the Act on the ground that revision is necessary for the aforesaid appellate order passed by the appellate authority for the year 1987 -88. A copy of the order passed by the Commissioner for initiating suo motu revision under Section 46(4) has been filed and annexed as Annexure -10 to the writ application In the counter -affidavit filed by the respondents, besides challenging the maintainability of the writ application without exhausting the alternative remedy, it is stated that the Commissioner of Commercial Taxes has absolute jurisdiction to initiate suo motu proceeding under Section 46(4) of the Act for the purpose of examining the correctness of the appellate order passed by the Joint Commissioner of Commercial Taxes (Appeal). It is further stated that before exercising suo motu power of revision, the Commissioner issued notice and gave reasonable opportunity of hearing to the petitioner.
(3.) MR . Biren Poddar, learned Counsel for the petitioner firstly submitted that final order passed by the appellate authority in appeal was communicated to the Commissioner of Commercial Taxes and in that view of the matter, the only remedy available to the Commissioner was to file revision before the Tribunal, Commercial Taxes under Section 46(1) of the Act and not to exercise suo motu revisional power under Section 46(4) of the Act. In this connection, learned Counsel referred Rule 30(2)(a) of the Bihar Finance Rules. Learned Counsel submitted that if the Commissioner is vested with the power of suo motu revision under Section 46(4) of the Act against the appellate proceeding and the appellate order, it will be serious injustice and hardship and the provision of revision will become nugatory and redundant. Learned Counsel then submitted that initiation of suo motu revision without calling for and examining the record of the concerned appellate proceeding is arbitrary exercise of jurisdiction. Learned Counsel submitted that the appellate authority remanded back the matter to the Assessing Officer for passing fresh assessment order and while the assessment proceeding was in progress, the suo motu power was arbitrarily exercised by the Commissioner of Commercial Taxes which is nothing but colorable exercise of power. Learned Counsel relied upon various decision viz. in the case of Commissioner of Income Tax v. National Taj Traders : [1980]121ITR535(SC) , in the case of Budhan Singh v. Babi Bux and Anr. : [1970]2SCR10 , in the case of Tirath Singh v. Bachittar Singh and Ors. : [1955]2SCR457 , in the case of Union of India v. Sankal Chand Himatlal Sheth and Anr. 0065/1977 : [1978]1SCR423 , in the case of Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd. and Ors. : [1987]2SCR1 , and in the case of Girnar Traders v. State of Maharashtra and Ors. : AIR2007SC3180 .;