2005 (8) TMI 626 - AT - VAT and Sales Tax

Summary

Issues:
Challenge to the vires of rule 205 of the West Bengal Sales Tax Rules, 1995 under section 8 of the West Bengal Taxation Tribunal Act, 1987.

Analysis:
The petitioner challenged the vires of rule 205 of the West Bengal Sales Tax Rules, 1995, arguing that the Commercial Tax Officer lacked jurisdiction under section 64 of the West Bengal Sales Tax Act, 1994. The petitioner, enjoying a tax holiday under section 39 of the Act, had books seized by officials for alleged contravention of section 63. The penalty imposed lacked findings on the seized books. The petitioner contended that rule 205 did not empower the Commercial Tax Officer to initiate proceedings under section 64, creating an anomalous situation with conflicting authorities. The petitioner argued that delegation under the rule violated the doctrine of "delegatus non potest delegare," as only the State Government had the authority to make rules. The respondents defended the Commercial Tax Officer's actions as authorized by the Commissioner.

The key consideration was whether the Explanation to rule 205 violated the doctrine of "delegatus non potest delegare" and if rule 205 was ultra vires the Act, 1994. The doctrine prohibits re-delegation of delegated powers unless expressly permitted. The State Government's authority to make rules under section 104 of the Act allowed for retrospective effect, as seen in the Explanation to rule 205. The retrospective operation did not impair existing rights or impose new liabilities, thus not illegal. The delegation to the Commissioner was within the legislative framework, and sub-delegation was permissible under the law.

The petitioner argued that rule 205 contradicted the Act by defining "appropriate assessing authority" differently. However, the rule did not transgress the Act's definition, as the authorized officer acted on specific issues. The authorized officer's actions did not complicate matters for the "appropriate assessing authority" defined under the Act. The judgment favored the respondents, upholding the Explanation to rule 205 as intra vires the Act. The petitioner was granted liberty to move before the revisional authority for further review, if desired, within a specified timeframe.