2008 (3) TMI 648 - HC - VAT and Sales Tax

Right to appeal - Held that - From a plain reading of section 45(1), (2) of the Act, it is evident that right of appeal is available to a dealer only. An order passed either under section 45(1) or (2) is revisable under section 46(1) of the Act, which remedy only the dealer can invoke. The Revenue has not been given any right to file appeal either under section 45(1) or 45(2) of the Act or to invoke the revisional power under section 46(1) of the Act. In the face of it, the Legislature thought it fit to provide remedy to the Revenue and made it clear that it is available only in a case when it is prejudicial to the interest of the Revenue. In the absence of any express power given to the Revenue to file an appeal, against the order of assessment, which is prejudicial to the interest of Revenue, the Legislature has conferred suo motu power to the Commissioner to correct and pass such order as it deems fit. This in no way can be said to be discriminatory or impeding the right of a dealer guaranteed under article 14 or 19(1)(g) of the Constitution of India. It in no way affects the right under article 300A of the Constitution of India also. Thus do not find any merit in the application and it is dismissed accordingly

Issues Involved:
1. Quashing of the order dated March 16, 2006, by the Commissioner of Commercial Taxes.
2. Quashing of the assessment orders dated February 20, 2004, and September 16, 2004.
3. Declaration of Section 46(4) of the Bihar Finance Act, 1981, as ultra vires.
4. Interpretation of the amended Section 46(4) of the Bihar Finance Act, 1981.
5. Right of appeal and the requirement of deposit for invoking appellate remedy.
6. Alleged discrimination and impediment to trade and business rights under Articles 14, 19(1)(g), and 300A of the Constitution of India.

Detailed Analysis:

1. Quashing of the Order Dated March 16, 2006, by the Commissioner of Commercial Taxes:
The petitioner sought to quash the order passed by the Commissioner of Commercial Taxes, which dismissed the revision application on the grounds that the assessment order was not prejudicial to the interest of the Revenue. The court upheld the Commissioner's decision, stating that the Commissioner correctly interpreted Section 46(4) of the Act, which requires that for the Commissioner to exercise suo motu power, the order must be prejudicial to the interest of the Revenue.

2. Quashing of the Assessment Orders Dated February 20, 2004, and September 16, 2004:
The petitioner also sought to quash the assessment orders and the consequential notices for payment. The court did not find merit in this request, as the petitioner failed to demonstrate that the orders were prejudicial to the interest of the Revenue, a necessary condition for invoking the Commissioner's revisional powers under Section 46(4) of the Act.

3. Declaration of Section 46(4) of the Bihar Finance Act, 1981, as Ultra Vires:
The petitioner argued that the amended Section 46(4) of the Act was ultra vires. The court rejected this argument, noting that the Legislature has the authority to impose conditions and restrictions on the right of appeal. The court emphasized that the right of appeal is a statutory right, not a fundamental or constitutional right, and the Legislature can regulate it.

4. Interpretation of the Amended Section 46(4) of the Bihar Finance Act, 1981:
The court provided a detailed interpretation of the amended Section 46(4), emphasizing that the Commissioner's power to revise is contingent upon the order being prejudicial to the interest of the Revenue. The court noted that the language of the statute is clear and unambiguous, and the Commissioner's power is restricted to cases where the order is both erroneous and prejudicial to the Revenue's interest.

5. Right of Appeal and the Requirement of Deposit for Invoking Appellate Remedy:
The petitioner contended that the requirement to deposit a certain percentage of the assessed tax to invoke the appellate remedy was burdensome. The court dismissed this contention, reiterating that the right of appeal is a statutory right subject to conditions imposed by the Legislature. The court cited the Supreme Court's decision in Anant Mills Co. Ltd. v. State of Gujarat, which upheld the imposition of such conditions as permissible.

6. Alleged Discrimination and Impediment to Trade and Business Rights under Articles 14, 19(1)(g), and 300A of the Constitution of India:
The petitioner argued that limiting the remedy under Section 46(4) to cases prejudicial to the Revenue's interest was discriminatory and impeded their constitutional rights. The court rejected this argument, explaining that the Legislature's intent was to provide a remedy to the Revenue through the Commissioner's suo motu power, as the Revenue does not have the right to appeal against assessment orders. The court found no violation of Articles 14, 19(1)(g), or 300A of the Constitution.

Conclusion:
The court dismissed the writ application, upholding the Commissioner's decision to dismiss the revision application and finding no merit in the petitioner's arguments against the assessment orders and the amended Section 46(4) of the Act. The court emphasized the statutory nature of the right of appeal and the Legislature's authority to impose conditions on its exercise.

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