1984 (12) TMI 285 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to recovery proceedings under Revenue Recovery Act based on validity of certificate forwarded by Collector of Bombay for recovery of sales tax arrears.

Analysis:
The petitioner was assessed to sales tax under the Bombay Sales Tax Act, 1959, and was due a sum of Rs. 43,119 towards sales tax outstanding to the State of Maharashtra. Due to default in payment, action was initiated under the Revenue Recovery Act (Central Act 1 of 1890). A certificate for recovery was forwarded by the Assistant Commissioner of Sales Tax (III), Enforcement, Bombay, to the Collector, Bangalore, for recovery from the petitioner. The petitioner challenged the recovery proceedings, seeking to quash the notice issued by the Special Tabsildar for PUC & Misc. Recoveries, Bangalore. The challenge was based on the contention that the certificate for recovery forwarded by the Collector of Bombay was not in accordance with the law.

The key argument presented was whether the certificate signed by the Assistant Commissioner of Sales Tax (III), Enforcement, Bombay, on behalf of the Collector of Bombay was valid under sections 3 and 5 of the Revenue Recovery Act. The petitioner's counsel argued that delegation of signing such certificates for public demands other than land revenue was impermissible. The respondents contended that the delegation was valid, and the certificate complied with the law.

The interpretation of sections 3 and 5 of the Act was crucial in determining the validity of the certificate. Previous decisions from High Courts were cited to support both arguments. The High Court of Madras, Andhra Pradesh, and Karnataka had interpreted these sections in various cases. The decisions highlighted that a Collector may issue a certificate under section 3 for sums recoverable as land revenue by public officers other than the Collector. Delegation of signing such certificates by the Collector was permissible under the Act.

The Court referred to specific cases, such as K. Burman v. Commercial Tax Officer, Calcutta and Somasudarshan Goud v. District Collector, Hyderabad, to establish the validity of certificates issued under section 3 of the Act. These cases emphasized that delegation of signing certificates was allowed under the Act, and the recovery of public demands could be treated as arrears of land revenue payable to the Collector.

Ultimately, the Court dismissed the writ petition, holding that the certificate forwarded by the Collector of Bombay for recovery of sales tax arrears from the petitioner was valid and enforceable. The delegation of power to sign the certificate by the Collector was deemed lawful, and all contentions raised by the petitioner were rejected.