1981 (4) TMI 257 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Whether the Maharashtra Sales Tax Tribunal has the power to condone the delay in filing an application for reference under section 61(1) of the Bombay Sales Tax Act, 1959.
2. Whether the petitioners, as building contractors, can be held liable to purchase tax under the said Act.
3. Applicability of section 5 of the Limitation Act, 1963, to the proceedings before the Tribunal.

Issue-wise Detailed Analysis:

1. Power to Condon the Delay:
The primary issue in this case is whether the Maharashtra Sales Tax Tribunal has the power to condone the delay in filing an application for reference under section 61(1) of the Bombay Sales Tax Act, 1959. The petitioners' application for reference was dismissed by the Tribunal on the grounds of being filed seven days late. The Tribunal held that it had no power to condone the delay. The petitioners argued that section 29(2) of the Limitation Act, 1963, allows for the application of section 5 of the Limitation Act, which provides for the condonation of delay. However, the respondents contended that the power to condone delay was expressly conferred only for appeals and revisions under the said Act, and not for applications for reference, thereby implying the exclusion of section 5 of the Limitation Act.

2. Liability to Purchase Tax:
The petitioners, as building contractors, contended that they should not be liable to purchase tax under the said Act because they consume the goods they purchase in the construction of buildings. This issue was settled by the judgment in Commissioner of Sales Tax v. D.V. Save, where it was held that building contractors who purchase materials and consume them in construction are considered dealers under section 2(11) of the said Act and are liable to purchase tax.

3. Applicability of Section 5 of the Limitation Act, 1963:
The petitioners relied on section 29(2) of the Limitation Act, 1963, to argue that section 5 of the Limitation Act should apply to their application for reference, allowing the Tribunal to condone the delay. The respondents countered that section 5 was impliedly excluded for applications for reference under the said Act. The court examined the statutory provisions and relevant case law, including the Supreme Court's decision in Mangu Ram v. Municipal Corporation of Delhi, which clarified that section 5 of the Limitation Act, 1963, applies unless expressly excluded by a special or local law.

The court also referred to the Supreme Court decisions in Nityanand M. Joshi v. Life Insurance Corporation of India and Kerala State Electricity Board, Trivandrum v. T.P. Kunhaliumma, which held that sections 4 and 5 of the Limitation Act apply only to courts and not to other tribunals. Additionally, the Supreme Court's decision in Commissioner of Sales Tax, Uttar Pradesh, Lucknow v. Parson Tools and Plants confirmed that taxing authorities are not courts but administrative tribunals, and section 5 of the Limitation Act does not apply to them.

The court concluded that the decision in Vasanji Ghela & Co. v. State of Maharashtra, which held that section 5 of the Limitation Act applies to applications for reference under the Bombay Sales Tax Act, 1946, was no longer good law in light of the Supreme Court's later decisions.

Conclusion:
The court held that the Tribunal had no power to condone the delay in filing the application for reference under section 61(1) of the Bombay Sales Tax Act, 1959, as section 5 of the Limitation Act, 1963, did not apply to the Tribunal. Consequently, the petitioners' application was time-barred, and the Tribunal's dismissal of the application was upheld. The petition was dismissed, and the rule issued therein was discharged without any order as to costs.