1984 (3) TMI 350 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Interpretation of the letter dated 28th July, 1965.
2. Arguments made before the Deputy Commissioner.
3. Tribunal's decision on the dealer's agreement for deduction rejection under the first proviso to section 9 of the Bombay Sales Tax Act, 1953.

Summary:

1. Interpretation of the letter dated 28th July, 1965:
The primary issue was whether the dealer's offer to give up the claim for deduction under the first proviso to section 9 of the Bombay Sales Tax Act, 1953, was conditional upon the waiver of the post-assessment penalty. The court found that the offer made in the letter dated 28th July, 1965, was indeed conditional on the post-assessment penalty being waived. The court rejected the revenue's argument that the offer should be considered unconditional because the Deputy Commissioner could not fully waive the penalty. The court emphasized that an offer coupled with a condition remains conditional even if the condition cannot be fully accepted.

2. Arguments made before the Deputy Commissioner:
During the hearing on 10th May, 1966, the notes of proceedings indicated that the dealer's representative, Mr. Surte, reiterated the conditional nature of the offer. The court noted that the Deputy Commissioner's notes were brief and not verbatim records of the arguments. The court interpreted the notes to mean that the dealers were willing to give up their claim under the first proviso to section 9 provided the post-assessment penalty was waived. The court found that the Deputy Commissioner did not treat the offer made during the hearing as a new or unconditional offer.

3. Tribunal's decision on the dealer's agreement for deduction rejection:
The Tribunal had held that the dealers had agreed to get their claim for deduction under the first proviso to section 9 rejected unconditionally. The court disagreed, stating that the offer was conditional and that the Deputy Commissioner was required to decide on the merits of the dealer's claim for deductions if the condition (waiver of the penalty) was not met. The court concluded that the Tribunal was not justified in treating the offer as unconditional and failing to address the merits of the dealer's claim.

Conclusion:
The court answered the question in the negative and in favor of the dealers, stating that the offer was conditional and the Deputy Commissioner was bound to decide the claim on merits if the condition was not accepted. The court ordered no costs and directed the refund of deposits made by the dealers before the Tribunal.