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TMI Blog1971 (9) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... ging certain orders relating to assessment of sales tax. The respondent held mineral concessions for extracting manganese ore in respect of mining areas in the districts of Balaghat, Chhindwara, Bhandara and Nagpur in the erstwhile State of Madhya Pradesh, i.e., before the reorganisation of the State. Under section 4 of the Central Provinces and Berar Sales Tax Act, 1947, hereinafter called the "Act of 1947", which was then applicable a dealer was liable to pay tax on all the sales if the gross turnover exceeded the limit specified in section 4(5) of the Act of 1947 and he was required under section 8 to get himself registered as a dealer. The material period, in the present case, is from October 1, 1953, to December 26, 1958. This may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner of Sales Tax. As he did not deposit the past dues of the tax and the penalty demanded of him the appeal was not admitted in view of section 38(3) of the Act of 1958 or section 22 of the Act of 1947. On January 23, 1961, the respondent preferred an appeal to the Board of Revenue without depositing the amount of tax required to be deposited under the law. That appeal was also not admitted. On March 28, 1966, the respondent filed a petition under article 226 of the Constitution challenging the order of assessment dated April 23, 1960, passed by the Sales Tax Officer as also the orders of the appellate authorities. In the writ petition a number of points were raised by the respondent some of which may be noticed: (1) The Sales Tax Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itation. But without deciding the other points which had been raised in the writ petition the High Court disposed of the whole matter by referring to section 78 of the States Reorganisation Act, 1956. That section is in the following terms: "The right to recover arrears of any tax or duty on property, including arrears of land revenue shall belong to the successor State in which the property is situated and the right to recover arrears of any other tax or duty shall belong to the successor State in whose territories the place of assessment of that tax or duty is included." It was urged on behalf of the assessee before the High Court that after the reorganisation of States, the Sales Tax Officer, Balaghat, had no jurisdiction to assess the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndara districts. Registration certificate granted to the assessee in 1958 after the reorganisation of the States in which the place of business was shown at Katangjhiri could not be made use of as that certificate could have no relation to Nagpur and Bhandara districts which were no longer within the State of Madhya Pradesh on that date. Therefore the Sales Tax Officer, Balaghat, had no jurisdiction to assess the tax with respect to sales effected from the mines in Nagpur and Bhandara districts. As the assessment order was a composite order it was liable to be quashed as a whole. Part VII of the States Reorganisation Act, 1956, relates to apportionment of assets and liabilities of certain Part A and Part B States. Section 76 deals with la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the provisions of Part II. It is difficult to give a narrow meaning to the word "arrears" in section 78 in the manner done by the High Court. "If the view of the High Court is to be accepted arrears of tax can refer to only that amount of tax which has been quantified after a proper assessment. This would lead to the result that where there has been no qualification or assessment order the position would be wholly uncertain and it would not be possible to say which State would be entitled to realise those taxes or duties. In other words, in the present case since the tax liability had not been determined or quantified there would be no arrears of tax and section 78 will be inapplicable. In our judgment, arrears should be given their ..... X X X X Extracts X X X X X X X X Extracts X X X X
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