COMMISSIONER OF SALES TAX Vs. HANSRAJ VISHRAM RAVANI

JUDGEMENT

(1.) THIS is a group of eight References under S. 34(1) of the Bombay Sales Tax Act, 1953 (hereinafter referred to as 'the said Act'), which can conveniently be disposed of by a common judgment.

(2.) THE assessees, who are the Respondents before us in all these eight References, are a partnership firm. The assessee -firm was registered as a dealer under the said Act. The place of business of the Respondents was situate within the jurisdiction of the Sales Tax Officer, Licence Circle, III Division, Bombay. At the relevant time, the Sales Tax, Officer, Licence Circle, III Division, Bombay, was one V. S. Nadkarni. Accordingly, the Respondents were filing their quarterly returns before the said Nadkarni. On October 28, 1955 the place of business of the Respondents was raided by one V. S. Deshpande, who was the Sales Tax Officer (III), Enforcement Branch, Bombay, and certain books of account were seized. Thereafter in respect of the assessment year 1953 -54, that is, April 1, 1953 to March 31, 1954, two assessment orders were made by the said Nadkarni, both dated October 31, 1955, one in respect of the general tax payable by the Respondents and the other in respect of the special tax payable by Respondents. On December 16, 1955 a notice was issued to the Respondents by the said Deshpande in which it was stated that it was revealed from the inspection of the Respondents' books of account that they had not kept a true account of the goods bought and sold by them and had thus contravened the provisions of S. 22 of the said Act. By the said notice the Respondents were called upon to show cause why the licence granted to them under S. 12 and 12A of the said Act should not be suspended. By this notice the Respondents were further called upon to submit their reply by December 28, 1955. On January 2, 1956 the said Deshpande issued to the Respondents two notices under S. 14 of the Act, one in respect of the assessment period April 1, 1954 to March 31, 1955 and the other in respect of the assessment period April 1, 1955 to September 30, 1955, directing the Respondents to attend before him on January 18, 1956 and to produce before him the evidence on which the Respondents might rely in support of their returns filed in respect of the said periods. On January 3, 1956 the said Deshpande issued a notice to the Respondents under S. 15 of the said Act in which it was stated that he was satisfied that the Respondents' turnover of sales of cloth amounting to Rs. 3,50,000 for the period April 1, 1953 to March 31, 1954 had escaped assessment or had been under assessed or had been assessed at a lower rate or that deductions for sales and purchases had been wrongly made from their turnover and directing them to attend before him on January 20, 1956 to show cause why the amount of tax payable by the Respondents in respect of such sales and purchases for the said period should not be assessed or reassessed. All these notices were served on January 4, 1956 upon one Chhogalal Dave and have been signed in Gujarati as follows : 'H. V. Ravani by the hand of C. Dave dated 4 -1 -56' It is an admitted fact that the said Dave was the mehtaji of the Respondents. Thereafter in the beginning of March 1956 the said Deshpande issued a witness summons against the Respondents. In this summons the date is typed as '10 -11 -1955' and over it is put in ink the date '1 -3 -56'. At the foot of the said summons there is another date '2.11'. By this summons the Respondents were called upon to attend personally before the said Deshpande on March 3, 1956 at 11 a.m. This summons contains inter alia two columns, one headed 'Proceedings' and the other headed 'Under section.' Against the column headed 'Proceedings' it was first written in ink 'assessment against M/s. Hansraj Vishram Ravani.' These words have been scored out and instead of them the, words in ink 'of Investigation' have been written. In the column headed 'Under section' the figures '13 -14' were first written. They have been scored out and instead of them the figure '23' is written S. 23 of the said Act confers power upon the Collector to direct a dealer to produce before him books of account and other documents and to furnish such information as he might require. It also confers power upon the Collector to search a dearer's place of business and seize his records S. 28 of the said Act confers power upon the Collector inter alia to summon and enforce the attendance of any person and examine him on oath S. 38 of the said Act deals with investigation of offences, and it confers power upon the Collector to authorize any person appointed under S. 3 to assist him to investigate offences punishable under the said Act, S. 13 of the said Act deals with the filing of returns, and S. 14 with assessment of taxes. It is difficult to understand how or why S. 23 was written in the column headed 'Under section' in the witness summons. The original intention in preparing this witness summons appears to be clear. It was to summon the Respondents for the purpose of examining them with respect to the returns filed by them, but when this was changed to investigations, it is difficult to understand why S. 23 of the said Act has been written instead of S. 38. This summons was served on the Respondents on March 2, 1956 and is signed on behalf of the Respondents by someone whose signature is indecipherable. In pursuance of the said summons, Mr. Vishnu Vyas, an advocate, appeared on behalf of the Respondents and applied for an adjournment on the ground that the senior partner of the Respondent firm, Hansraj Vishram Ravani, was sick, and produced a medical certificate in support of his application. Thereafter the Respondents sent their letter dated March 12, 1956 to the said Deshpande stating that as the said Hansraj was not keeping well, their mehtaji Chhogalal Dave would offer the explanation asked for, which would be binding on the Respondents. On March, 31, 1956 the said Deshpande passed four orders, namely, (1) an order of reassessment in respect of special tax under S. 15 of the said Act for the period April 1, 1953 to March 31, 1954, (2) an order of reassessment in respect of general tax in respect of the same period, also under S. 15 of the said Act, (3) an order of assessment for the period April 1, 1954 to March 31, 1955 under S. 14 of the said Act and (4) an order of assessment for the period April 1, 1955 to September 30, 1955 under S. 14 of the said Act. Against the said four orders the Respondents filed four separate appeals. All the said appeals were dismissed by the Assistant Commissioner of Sales Tax by four separate orders, all dated December 27, 1957. The Respondents thereafter filed four separate revision applications which too were dismissed by the Deputy Commissioner of Sales Tax by four separate orders, all dated March 28, 1962. Against these orders of dismissal of their revision applications the Respondents went in further revision to the Tribunal. The Respondents also applied for condonation of delay in filing the said revision applications. The Tribunal refused to condone the delay. Thereupon the Respondents filed four writ petitions in this High Court under Articles 226 and 227 of the Constitution, being Special Civil Application No. 302 of 1955 (with Special Civil Applications Nos. 303 to 305 of 1955) - Messrs Hansraj Vishram Ravani and another vs. The Maharashtra Sales Tax Tribunal and others decided by Abhyankar and Madon, JJ., on December 12, 1968 (Unrep.), and this High Court held that the orders of the Deputy Commissioner of Sales Tax were not communicated to the Respondents, and the period of limitation had not commenced to run, and, therefore, the question of condonation of delay in filing the revision applications before the Tribunal did not arise. Thereafter the Respondents were properly served with the said orders of the Deputy Commissioner of Sales Tax, and they filed fresh revision applications before the Tribunal. Amongst the contentions taken up by the Respondents were (1) that there could be no best judgment assessment in reassessment proceedings under S. 15 of the said Act, (2) that the said Deshpande, who was Sales Tax Officer (III), Enforcement Branch, Bombay, had no jurisdiction either to pass the said orders of assessment or reassessment, and (3) that the service of the notices under Ss. 14 and 15 of the said Act on the said Chhogalal Dave was not a valid service. When these matters came up before a Regular Bench of the Tribunal, the Bench referred these three points to a Special Bench for its decision. By a common judgment delivered in all the said four revision applications on July 24, 1969, the Special Bench of the Tribunal decided all these three points in favour of the Respondents. Following the decision of the Special Bench, the Regular Bench by a common judgment dated August 12, 1969 allowed all the said four revision applications and set aside the said orders of reassessment and assessment arising out of the judgment of the Special Bench of the Tribunal and the said order passed by the Regular Bench. Eight cases have been stated to us by the Tribunal at the instance of the Commissioner of Sales Tax, the Applicant before us in all eight References herein, and the following five questions of law referred to us in each of the said References by a common order of reference dated December 14, 1971, : -

(3.) SO far as the first question is concerned, both learned Counsels are agreed that our decision in Commissioner of Sales Tax vs. P. Ambalal and Co., would govern the case, and according to that decision it should be answered in the negative in favour of the Department.