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TMI Blog1953 (1) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 2,134-5-6 for the first quarter of 1947-48, Rs. 2,516-12-9 for the 2nd quarter and Rs. 7,206-0-6 for the 3rd quarter; total Rs. 11,957-3-9 with a penalty for wilful default amounting to Rs. 2,043-12-3, i.e., Rs. 14,000 in all. Assessment order dated 31st March, 1949, enclosed Exhibit A. The assessee on receipt of the notice under Section 13(5) of the Act filed two petitions before the Sales Tax Officer (Exhibits B and C) showing cause against imposition of tax and penalty. In his first petition (Exhibit B) it was submitted that there was a firm in the name of Telu Ram Jain consisting of (1) Self, (2) Sita Ram Jain, (3) Jagannath, (4) Hansraj Agnihotra, and (5) Chamanlal Agarwala as partners to carry out contract business only in respect of contracts obtained by Telu Ram Jain from the Central Public Works Department on 15th March, 1947, and the contract having been entered into before 1st July, 1947, no sales tax was payable in respect thereof. In his second petition (Exhibit C) it was stated that there was another firm in the name of Telu Ram Jain consisting of (1) Self, (2) Bhakhtawar Jain, (3) Sita Ram Jain, (4) Jagannath, (5) Hansraj, and (6) Manohar Lal, as partners to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y adverse inference. But apart from that, the circumstances of the execution of deed, the terms of partnership and the way the business is done evidently led the Sales Tax Officer to suspect the bona fides of the alleged partnerships. Apparently these partnership deeds are a con- venience for Telu Ram and his partners to carry out the work done by the assessee for the Central Public Works Department both for finding capital and staff necessary for reliable supervision. The Board is doubtful if they can be considered to be separate dealers under the Bihar Sales Tax Act. Considering the definition of the words "dealer", "contract" and "sale" as defined in the Bihar Sales Tax Act, it appears that the mere fact of the assessee having entered into partnership with some friends and others subsequently does not enable them to be treated as separate entities. Another point raised before the Board by the assessee was that the firm which was brought into existence on 17th March, 1947, should not have been taxed as it was formed before the 1947 Act came into force. Section 4(1) proviso of the Act may be seen in this connection. In 1944 Act it was stated "provided that the tax shall not be pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. On the strength of what has been said above, the Board rejected the two petitions of revision by its order dated 5th March, 1950 (Exhibit G). The assessee thereafter filed on 31st July, 1950, two petitions for reference to the Honourable High Court on the 21 questions of law as detailed therein (Exhibits H and H1). The Board heard the lawyers of both the parties again on 28th March, 1951. One of the questions formulated in these applications fur reference is whether in view of the clear provisions of the Indian Partnership Act, there was any justification in law to come to the conclusion that the two deeds of partnership, namely the deed, dated 17th March, 1947, and the deed, dated 20th November, 1948, do not evidence real and separate partnerships? It is contended that the partnership is a firm, and if there are two or three firms with one common partner, it cannot be held that the two or three firms are not dealers and only the common partner is a dealer within the meaning of the word "dealer" as defined in the Bihar Sales Tax Act. This appears to the Board to be a doubtful point and a clear expression of views on this point of law would be beneficial to all. Another point rai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der on the reference petition dated 7th April, 1951, enclosed Exhibit I. The Board accordingly refers the following four questions of law for an authoritative decision: "(1) Whether a petition filed under Section 25 of the Act after the expiry of 90 days from the date of the passing of the orders by the Board can be admitted or not? (2) Whether, in the circumstances of this case and in consideration of the provisions of the Indian Partnership Act, the two firms should be treated as separate dealers or not, and whether Telu Ram Jain alone can be assessed to sales tax on the contracts obtained by him from the Central Public Works Department? (3) Whether the Amending Act VI of 1949 can be applied, as it appears to be the intention of the legislature to correct the 1947 Act, with effect from the date of its first publication, and whether the peti- tioners have been rightly assessed under the 1947 Act as amended by the 1949 Act? and (4) Whether the Amending Act, which was extended to Chota Nagpur on 22nd March, 1949, would govern the proceedings, which were commenced on 13th January, 1949?" The last question No. 4 is also being referred to in the same form in Board's Case No. 491 of 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t? (3) Whether the Amending Act VI of 1949 can be applied, as it appears to be the intention of the legislature to correct the 1947 Act, with effect from the date of its first publication, and whether the petitioners have been rightly assessed under the 1947 Act as amended by the 1949 Act? and (4) Whether the Amending Act, which was extended to Chota Nagpur on 22nd March, 1949, would govern the proceedings which were commenced on 13th January, 1949?" When the argument of the case commenced Mr. Gopal Prasad, who appears on behalf of the Advocate-General, raised a preliminary objection that the application filed by the assessee under Section 25(1) of the Act was not maintainable on the ground that it was not made within 90 days of the passing of the order in revision by the Board of Revenue. It was submitted by the learned counsel that if this preliminary question was decided in favour of the Department, it was not necessary for the High Court to examine or determine the other questions of law formulated in the statement of the case. The question of limitation is the first question of law which is formulated by the Board of Revenue, and we propose to examine this question at the ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was not pronounced in the present case in the presence of the parties in open Court but judgment was reserved and on the 5th of March, 1950, the Board of Revenue pronounced judgment in the absence of the asses- see. It was urged that no notice was given by the Board of Revenue as regards the date on which the judgment was to be pronounced in the case, and in view of these circumstances it was contended that the terminus a quo for the period of limitation should commence on the 6th of June, 1950, when the assessee was actually apprised of the order of the Board of Revenue on the revision applications. On the question of cons- truction Mr. Untwallia referred to a line of authorities commencing from Annamalai Chetty v. Colonel J.G. Cloete(1) in which it was held by the Madras High Court that under Section 25 of Act XXVIII of 1860 (Madras Boundary Act), which limits the time within which a suit may be brought to set aside the decision of a Settlement Officer to two months from the date of the award, time will not begin to run until the date on which the decision is communicated to the parties. This case was followed in Seshama v. Sankara(2) and the Secretary of State for India in Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 Mad. 491. (3) (1911) I.L.R. 34 Mad. 151. (6) (1930) I.L.R. 9 Pat. 172. of the assessee that the Assistant Commissioner of Income-tax fixed no time for passing the order in appeal and the order was in fact passed in the absence of the assessee. It was contended that in these circumstances it was only just that the period of limitation should be computed not from the date on which the order purports to have been recorded but from the date when the order was communicated to the assessee. It was also point- ed out that, according to the prevailing practice, the officers of the Income- tax department do not insist on the presence of the party on the date on which the order is to be passed, and, as no date is fixed for the passing of the order, the order is always communicated to the party by post. It was urged that it may mean great hardship to the parties in certain cases because it is possible that the party may not know anything about the order until the period of limitation has expired. The argument was rejected by the Division Bench and it was held that the period of limita- tion for the application under Section 66 (2) of the Income-tax Act, 1922, was one month and the date shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pointed out a similar distinction between the language of Section 66(2) and Sec- tion 66(3) of the Income-tax Act, 1922. In our opinion, the present case falls within the scope of the principle laid down by the Division Bench in Firm of Mohan Lal Hardeo Das v. Commissioner of Income-tax, Bihar and Orissa(1) with which we are bound. Our decision in Doma Sao Kishan Lal v. State of Bihar(2) is also relevant. In that case we held that the time prescribed by Section 21 of the Bihar Sales Tax Act, 1944, which corresponds to Section 25 of the Bihar Sales Tax Act, 1947, is an essential condition pre-requisite for making the reference and the omission to make the reference within the time prescribed is fatal to the validity of the reference. We further held in the circumstances of that case that the Board of Revenue improperly made the reference in violation of the provision of the statute and the High Court was capable of entertaining objection to the statement of the case, and if it came to the conclusion that the case should never have been stated, the High Court was not compelled to express its opinion upon the questions of law referred. For the reasons stated, we think that the fir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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