1972 (9) TMI 140 - HC - VAT and Sales Tax

Summary

Issues:
1. Interpretation of the term "person" under section 26(1) of the Tamil Nadu General Sales Tax Act.
2. Authority of Commercial Tax Officer to issue notices to courts.
3. Compliance of court with notices issued by sales tax authorities.
4. Liability of court for non-compliance with notices.

Analysis:

The case involved a dispute over the refund of certain amounts held by the court to the credit of a specific case. A person named Chandrasekaran applied for the refund, but the Deputy Commercial Tax Officer also claimed the amount towards Government dues. The Sub-Divisional Magistrate directed the refund to Chandrasekaran, leading to a revision petition by the Deputy Commercial Tax Officer before the District Magistrate, North Arcot. The District Magistrate referred the case, questioning the Sub-Divisional Magistrate's view that a Commercial Tax Officer cannot issue a notice to the court.

The Sub-Divisional Magistrate based his decision on the interpretation of the term "person" in section 26(1) of the Tamil Nadu General Sales Tax Act. He concluded that the court falls within the definition of "person" and can be issued notices by sales tax authorities. The court held that the term "person" includes the court and that the sales tax authority has the right to issue notices to any person, including a court, holding money on behalf of an assessee.

The respondent argued that clauses (4) and (6) of section 26 exclude courts from receiving notices. However, the court disagreed, stating that non-compliance with notices would result in personal liability and a charge on the properties of the non-compliant party. The court emphasized that once a notice is issued to the court, it is obligated to comply, and failure to do so may lead to the authorities invoking section 26 provisions for recovery.

Ultimately, the court answered the District Magistrate's reference in the affirmative, asserting that the Commercial Tax Officer had the authority to issue notices to the court. The respondent was advised to seek remedies if they believed the tax assessment was incorrect. The court dismissed the petition, concluding the case based on the interpretation of relevant legal provisions and the obligations of courts to comply with notices issued by sales tax authorities.