1982 (11) TMI 146 - HC - VAT and Sales Tax

Summary

Issues:
1. Challenge to the order of the Assistant Commissioner of Sales Tax regarding the taxation rate of khajoors.
2. Validity of the order dated 1st March, 1969, and subsequent demand notice issued on 2nd May, 1973.
3. Delay in filing writ petitions and the impact on invoking the extraordinary jurisdiction of the Court.
4. Application of Punjab High Court Rules and Orders to the authorities under the Act.

Analysis:
1. The petitioners, engaged in the business of fresh fruits and khajoors, contested the assessment of khajoors for the year 1964-65. The Sales Tax Officer initially assessed the tax rate at 1%, treating khajoors as dry fruits. However, the Assistant Commissioner of Sales Tax revised the assessment, deeming khajoors taxable at 5%, classifying them as general and unclassified items. This led to demands against the petitioners, prompting them to challenge the order through writ petitions.

2. The judgment scrutinized the procedural irregularities in the revision process initiated by the Assistant Commissioner. The Court found the order dated 1st March, 1969, to be a nullity due to the lack of a fair hearing for the petitioners. The Assistant Commissioner's decision to proceed "in absentia" without notifying the petitioners violated the principles of natural justice. Consequently, the Court quashed the order and demands, directing a fresh hearing before the Assistant Commissioner to ensure procedural fairness.

3. The Court differentiated the case of Gulati Fruits Co. from the other petitioners based on the presence and participation of the former during the assessment proceedings. Despite the Assistant Commissioner's decision to tax khajoors at 5%, the petitioners did not pursue the statutory remedy of revision to the Chief Commissioner. The Court dismissed the writ petition of Gulati Fruits Co. due to significant delays and failure to exhaust available legal remedies under the Act.

4. The judgment clarified the inapplicability of Punjab High Court Rules and Orders to the authorities under the Act, emphasizing that tribunals are not bound by rigid procedural rules but must adhere to the principles of natural justice. The Court highlighted the duty of authorities to afford a fair hearing to parties involved, emphasizing the importance of due process in administrative proceedings.