1976 (1) TMI 39 - AT - VAT and Sales Tax

Issues Involved:
1. Rectification under Section 62 of the Bombay Sales Tax Act, 1959.
2. Violation of principles of natural justice due to insufficient notice period.
3. Interpretation of statutory notice period.
4. Authority and jurisdiction of the Tribunal to rectify mistakes.
5. Applicability of Supreme Court precedents.
6. Procedural objections regarding rectification applications.
7. Impact of rectification on the right to appeal or reference.

Detailed Analysis:

1. Rectification under Section 62 of the Bombay Sales Tax Act, 1959:
The applications were filed for rectification under Section 62 of the Bombay Sales Tax Act, 1959. The dealer collected tax on exempt goods, leading to a wrong collection of Rs. 49,924, which the STO forfeited and adjusted against a refund due to the dealer.

2. Violation of Principles of Natural Justice Due to Insufficient Notice Period:
The dealer contended that the STO did not give a clear 15 days' notice as required by Rule 35, thereby violating the principles of natural justice. The Tribunal initially accepted this contention, relying on the Andhra Pradesh High Court's decision in Heradevi vs. State of Andhra & Anr., which interpreted the notice period requirement stringently.

3. Interpretation of Statutory Notice Period:
The Tribunal's initial decision was based on the Andhra Pradesh High Court's interpretation that "three whole days must elapse." However, the Supreme Court in Jai Charan Lal Anal vs. The State of U.P. clarified that the expression "not earlier than thirty days" does not equate to "not less than thirty days," implying a more lenient interpretation.

4. Authority and Jurisdiction of the Tribunal to Rectify Mistakes:
The dealer's counsel argued that the Department does not have the right to file rectification applications under Section 62, which allows the Commissioner to rectify mistakes apparent from the record. The Tribunal can act suo motu to correct mistakes, even if brought to its attention by the Department, as supported by the Madras High Court's decision in P. Kuttikrishna Nair vs. Income-tax Appellate Tribunal.

5. Applicability of Supreme Court Precedents:
The Tribunal recognized that the Andhra Pradesh High Court's decision had been overruled by the Supreme Court in Jai Charan Lal Anal vs. The State of U.P. The Tribunal acknowledged that a glaring and obvious mistake of law had crept into its previous judgment, which warranted rectification.

6. Procedural Objections Regarding Rectification Applications:
The dealer's counsel raised procedural objections, arguing that the notice served mentioned applications made by the Department, and a fresh notice should be issued if the Tribunal corrects the mistake suo motu. The Tribunal found this objection technical and noted that the dealer was already aware of the mistake and the rectification sought.

7. Impact of Rectification on the Right to Appeal or Reference:
The dealer's counsel expressed concerns that allowing rectification might preclude the dealer from filing a reference to the High Court. The Tribunal noted that the Supreme Court's decision rendered the question unarguable and non-debatable, making rectification the appropriate remedy.

Conclusion:
The rectification applications were allowed. The Tribunal set aside its previous orders that allowed the appeals based on the notice period issue and restored the appeals for hearing on merits. The Tribunal emphasized that the law as interpreted by the Supreme Court must be followed, and the glaring mistake in its earlier judgment warranted rectification.

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