STATE OF BIHAR Vs. ARTHUR BUTLER AND CO LTD

JUDGEMENT

(1.) In this case the Board of Revenue has referred the following questions of law for the opinion of the High Court under Section 25 of the Bihar Sales Tax Act, 1947:

(2.) It was, however, argued by the learned Government Advocate that the High Court is now hearing the reference under Section 25 (5) and it was not open to the opposite party at this stage to contend that the reference is incompetent or that the High Court ought not to answer the questions of law raised by the Board of Revenue in the statement of the case. In support of this proposition the leaded Government Advocate relied on Commissioner of Income-tax, West Bengal v. Diana Engineering Co., AIR 1954 Cal 575 (F). But we do not think that the principle of that decision applies to the present case. The reason is that at the time of admission of the application made under Section 25 (2) (b) of the Sales Tax Act there was no hearing given to the assessee opposite party in this case. The order of admission was made by the Bench on the 26th of July, 1954, ex parte, and without granting a hearing to the assessee. If notice had been, given to the assessee at the time of admission, it would have been open to the assessee to take the point that the application was incompetent since it was not made by the Commissioner, of Sales Tax as required by Section 25 (2) (b). It is true that under the newly framed rule of the High Court, namely, Rule 5 of Ch. XII (c); an application under Section 25 (2) (b) is placed for admission before a Bench after service of notice is effected on the opposite party. But that rule was not in existence when the present application was made by the State of Bihar under Section 25 (2) (b) before the High Court on the 13th of November, 1953. That is the reason why no notice was given to the opposite party and no hearing was given to the opposite party at the time when the Bench called for a statement of the case. The position, however, is different with regard to an application made under Section 66 (2) of the Income-tax Act. In such a case the rule made by the High Court provides that notice should be given to the opposite party and a hearing should be granted to him before, the High Court Orders the Appellate Tribunal to make a statement of the case. We do not, therefore, consider that the decision reported in AIR 1954 Cal 575 (F) has any bearing on the present case. We do not consider that any question of estoppel arises against the opposite party. In other words, the opposite party cannot be prevented from raising at this stage the question that the application made under Section 25 (2) (b) is incompetent because it was made not by the Commissioner of Sales Tax but by the State of Bihar in violation of the statutory provisions contained in Section 25 (2) (b). The argument of learned Government Advocate on this point must, therefore, fail.

(3.) For these reasons, we hold that the reference made by the Board of Revenue in- this case is not competent and the High Court has no jurisdiction to hear the reference or to answer the questions of law raised in the reference. There will be no order as to costs of the hearing of this application.