1998 (12) TMI 577 - HC - VAT and Sales Tax

Summary

Issues:
- Jurisdiction of sales tax authority to impose adjournment costs.

Analysis:
The petitioner approached the Commissioner of Sales Tax under the Delhi Sales Tax Act, 1975, for determining disputed questions, leading to an adjournment request on a specified hearing date. The petitioner challenged the imposition of costs for adjournment through a writ petition, arguing that the Commissioner lacked the jurisdiction to levy such costs. The petitioner contended that sales tax authorities, not being courts, do not possess inherent powers like courts, such as dismissing cases in default, reviewing orders, or imposing adjournment costs. The petitioner highlighted alleged discriminatory practices in imposing costs based on which party requested the adjournment.

The primary issue revolved around whether a sales tax authority has the power to impose costs when adjourning a hearing due to a party's actions. The Court referred to various Supreme Court precedents, establishing that even in the absence of specific powers, quasi-judicial authorities possess inherent powers to ensure justice, prevent process abuse, and rectify mistakes. The Court emphasized that such powers are essential for effective functioning and are based on the rule of necessity. Precedents like J.K. Synthetics Ltd. v. Collector of Central Excise and others were cited to support this principle.

The Court delved into the interpretation of statutory powers, citing cases like Mohammed Kunhi's case, which emphasized that when a jurisdiction is granted, necessary powers are implied for its effective execution. The Court highlighted that the term "determination" in Section 49 of the Act implies quasi-judicial jurisdiction vested in the Commissioner, requiring a fair hearing opportunity. Balancing the need for adjournments against abuse of process, the Court noted that adjournment costs can serve as a deterrent and compensate the opposing party for inconvenience. The power to impose adjournment costs was deemed incidental to the principal jurisdiction of the adjudicating authority.

Referring to legal precedents like Ved Parkash v. Om Parkash and Official Liquidator v. Murlidhar S. Sharma, the Court affirmed that quasi-judicial authorities can devise their own procedures, including imposing costs for unjustified adjournments. However, the discretion to impose costs must be exercised reasonably and impartially to avoid vindictiveness or bias. The Court emphasized the need for expeditious disposal of matters while ensuring fair treatment to all parties involved.

In the specific case, where adjournment was sought due to the petitioner's counsel's indisposition and previous adjournments were not at the petitioner's instance, the Court found that the imposition of costs was not properly justified. Consequently, while recognizing the authority of the respondent to impose adjournment costs, the Court set aside the specific order imposing costs in this instance. The judgment concluded without awarding costs for the petition.