1994 (2) TMI 264 - SC - VAT and Sales Tax

Whether the transactions in question were exigible to tax or not under the Act? - Held that - Appeal allowed. As it is a proper case where the matters are remitted to the appellate authority viz. the Assistant Commissioner Sales Tax or the corresponding authority as may be obtaining today. We direct that the appellate authority shall entertain the appeal which was filed by the respondent on May 3 1966 without raising an objection on the ground of limitation and dispose it of in accordance with law.

Summary

Issues:
1. Whether the High Court was correct in granting relief to the respondent based on the lack of specific denial of facts in the counter-affidavit.
2. Whether the appellate authority was justified in refusing to condone the delay in filing the appeal.
3. Whether the High Court should have exercised its extraordinary jurisdiction under Article 226 in this case.
4. Whether the principle of Section 14 of the Limitation Act is applicable to the case.

Detailed Analysis:

1. The respondent, a registered dealer under the Bombay Sales Tax Act, sought a refund of tax paid under a mistake of law, citing the Bengal Immunity Co. Ltd. v. State of Bihar case as the basis for the claim. The respondent initially filed a suit which was dismissed, followed by a refund application and a subsequent writ petition. The High Court granted relief to the respondent, noting the lack of specific denial of facts in the counter-affidavit. The Supreme Court held that the High Court's decision was not reasonable as there was a controversy over relevant facts. The matter was remitted to the appellate authority for further consideration.

2. The appeal was filed by the respondent after a significant delay of 12 years from the date of the assessment order. The appellate authority refused to condone the delay, leading to the respondent challenging this decision in a writ petition before the High Court. The Supreme Court opined that the High Court should not have ignored the delay and exercised its extraordinary jurisdiction under Article 226. The Court directed the appellate authority to entertain the appeal without considering the limitation issue and decide it on merits.

3. The respondent's actions, including filing a suit, a refund claim, a writ petition, and an appeal, were analyzed in light of the principle of Section 14 of the Limitation Act. The Court observed that the respondent's actions post the Bengal Immunity case could attract the application of Section 14. However, the Court clarified that it did not express any opinion on the merits of the respondent's claim or the applicability of the Bengal Immunity case to the refund claim.

4. In conclusion, the Supreme Court allowed the appeal, set aside the High Court's judgment, and remitted the matter to the appellate authority for expeditious disposal. The Court emphasized that the appellate authority should consider the appeal without raising objections on grounds of limitation. No costs were awarded in the case.