1987 (10) TMI 360 - HC - VAT and Sales Tax

Summary

Issues:
1. Dismissal of license application based on turnover exceeding Rs. 1,50,000.
2. Lack of opportunity given to petitioners before rejection of license applications.
3. Legal infirmity in passing orders without following due procedure.

Issue 1: Dismissal of license application based on turnover exceeding Rs. 1,50,000:
The petitioners, a registered partnership firm, applied for a license under the M.P. General Sales Tax Act for the assessment years 1981-82 and 1982-83. The Sales Tax Officer dismissed the applications as the turnover exceeded Rs. 1,50,000. On revision, it was found that the turnover indeed exceeded the limit, leading to the dismissal of the applications. The court noted the turnover amounts for both years and upheld the decision based on the statutory provision.

Issue 2: Lack of opportunity given to petitioners before rejection of license applications:
The petitioners contended that they were not given an opportunity as required by rule 4(6) of the Rules before the rejection of their license applications. The court examined the notices and orders issued to the petitioners and found that proper opportunities were not provided. In one instance, a notice was issued incorrectly, and in another, no opportunity was given for the subsequent period. The court held that the petitioners were indeed not afforded the necessary opportunity as mandated by the Rules.

Issue 3: Legal infirmity in passing orders without following due procedure:
In a separate case, the petitioners sought to quash orders rejecting their license application for the assessment year 1979-80. The court found that the Sales Tax Officer had not followed the due procedure as outlined in the Rules. The Sales Tax Officer rejected the application without affording the petitioners an opportunity to prove the correctness of the information provided. The court held that the rejection was illegal and lacked compliance with the procedural requirements.

In conclusion, the court allowed the writ petitions, quashed the impugned orders, and directed the Sales Tax Officer to reconsider the license applications after providing the petitioners with the opportunity as per the Rules. The court emphasized the importance of following due process and providing parties with opportunities to be heard before making decisions.