9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
1963 (1) TMI 1 - SC - VAT and Sales TaxWhether the suit instituted by the appellant firm of Illuri Subbayya Chetty and Sons, in the court of the Subordinate Judge at Kurnool, seeking to recover ₹ 8,349 from the respondent, the State of Andhra Pradesh, on the ground that the said amount had been illegally recovered from it under the Madras General Sales Tax Act, 1939 (No. IX of 1939)for the years 1952-54 is competent or not? Held that - The clause assessment made under this Act , which occurs in section 18A, also occurs in section 67 with which the Privy Council was concerned, and in construing the said clause, the Privy Council observed that the phrase 'made under this Act' describes the provenance of the assessment it does not relate to its accuracy in point of law. The use of the machinery provided by the Act, not the result of that use, is the test. These two Privy Council decisions support the conclusion that having regard to the scheme of the Act, section 18A must be deemed to exclude the jurisdiction of civil courts to entertain claims like the present. In the result, we must hold that the view taken by the High Court is right and so the appeal fails and is dismissed.
Issues Involved:
1. Competency of the suit under Section 18A of the Madras General Sales Tax Act, 1939. 2. Excess collection of sales tax for the years 1952-54. 3. Estoppel against questioning the validity of the assessment. Detailed Analysis: 1. Competency of the Suit under Section 18A of the Madras General Sales Tax Act, 1939 The primary issue was whether the suit filed by the appellant to recover Rs. 8,349, alleged to have been illegally collected under the Madras General Sales Tax Act, 1939, was competent. The appellant argued that the tax was levied on sales of groundnuts, which should not have been taxed under the Act as the tax is only leviable on purchases. The respondent contended that the suit was barred by Section 18A of the Act, which prohibits any suit to set aside or modify any assessment made under the Act. The trial court ruled in favor of the appellant, but the High Court reversed this decision, holding that the suit was incompetent under Section 18A. The Supreme Court upheld the High Court's decision, emphasizing that Section 18A expressly excludes the jurisdiction of civil courts to entertain suits seeking to set aside or modify assessments made under the Act. The Court clarified that the phrase "any assessment made under this Act" includes all assessments made by the appropriate authorities, whether correct or not. The exclusion of civil court jurisdiction is supported by the presence of adequate alternative remedies within the Act, such as appeals to higher authorities and revisions by the High Court. 2. Excess Collection of Sales Tax for the Years 1952-54 The appellant claimed that the sales tax authorities had erroneously included groundnut sales in the taxable turnover, resulting in an excess collection of Rs. 5,398-4-3 for the year 1952-53 and Rs. 1,159-11-9 for the year 1953-54. The trial court found in favor of the appellant, concluding that there had been an excess collection of sales tax. However, the High Court found that the appellant had voluntarily included these transactions in its returns and paid the taxes accordingly. The Supreme Court agreed with the High Court, noting that the appellant had not disputed the taxable character of the transactions during the assessment proceedings and had not availed itself of the appellate remedies provided by the Act. 3. Estoppel Against Questioning the Validity of the Assessment The respondent argued that the appellant was estopped from questioning the validity of the assessment because it had voluntarily included the transactions in its returns and made tentative payments. The trial court rejected this argument, but the High Court upheld it, noting that the appellant had not raised any objections during the assessment proceedings or filed an appeal. The Supreme Court concurred, stating that the appellant's voluntary compliance and failure to challenge the assessments through the prescribed appellate mechanisms precluded it from contesting the assessments in a civil suit. Conclusion The Supreme Court dismissed the appeal, affirming the High Court's judgment that the suit was barred under Section 18A of the Madras General Sales Tax Act, 1939. The Court emphasized that the exclusion of civil court jurisdiction is justified by the alternative remedies provided within the Act. The appellant's failure to utilize these remedies and its voluntary compliance with the tax assessments further supported the dismissal of the suit. The appeal was thus dismissed with no order as to costs.
|
