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TMI Blog1956 (8) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... er stated that the business in respect of which the application was made had been registered with the Registrar, Joint Stock Companies, Bombay, on the 18th of November, 1933, that the company was a member of the Indian Colliery Owners' Association. Jharia (Bihar), that the gross turnover for the period from the commencement of the current year to 30th November, 1954 was Rs. 1,70,571-4-0, that the warehouse was at the colliery at Kusunda, district Manbhum, Bihar, that the company purchased coal and coke for re-sale, and finally that the company was going to import from overseas in future. The company as a dealer was accordingly registered, the registration certificate being issued on the 22nd April, 1955. On the 26th of April, 1955, the petitioner received a notice, being Notice No. LR/2582A/1/55-56/4585, dated 23rd April, 1955, under section 11(2) of the Bengal Finance (Sales Tax) Act, 1941. This was issued by the Commercial Tax Officer, Lyons Range Charge, Calcutta, and commences as follows: "Whereas I am satisfied on information which has come into my possession that you have been liable to pay tax under the Bengal Finance (Sales Tax) Act, 1941, in respect of the period commencin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her stated that such delegation would be ineffective because it must be based upon information which has come into the possession of the Commissioner and not anybody else. Before I proceed further, I will set out the relevant portion of section 11(2) of the Act: "If, upon information which has come into his possession, the Commissioner is satisfied that any dealer, who has been liable to pay tax under this Act in respect of any period but has failed to get himself registered, the Commissioner shall proceed in such manner as may be prescribed to assess to the best of his judgment the amount of tax due from the dealer in respect of such period and all subsequent periods and in making such assessment shall give the dealer a reasonable opportunity of being heard; and the Commissioner may, if he is satisfied that the default was made without reasonable cause, direct that the dealer shall pay by way of penalty in addition to the amount of tax so assessed a sum not exceeding one and a half times that amount. " Analysing the above, we find that prima facie it is the Commissioner who has to be satisfied, upon information which has come into his possession, that any dealer who was liable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. As I have stated above, section 11(2) prima facie talks about the satisfaction of the Commissioner upon information which has come into his possession. It cannot be denied also that under section 15 the Commissioner can only delegate any of his "powers" under the Act. Rule 71 also speaks about the delegation of "powers" conferred by section 11 of the Act. The question, therefore, is as to whether delegation can be made in a manner which would permit us to read the words "Commercial Tax Officer" in the place of the word "Commissioner" in section 11(2) of the Act. The first case to be considered is a Bench decision of this High Court, Shree Shew Sakti Oil Mills v. Members, Board of Revenue, West Bengal(1). This was a reference by the Board of Revenue under section 21(1) of the said Act, and raised the question relating to the delegation of powers by the Commissioner. It was a case under section 11(1) of the Act which provides that if no returns were furnished by a registered dealer in respect of any period by the prescribed date, or if the Commissioner was not satisfied that the 1. I.L.R. [1948] 2 Cal. 347. returns furnished were correct and complete, the Commissioner shall within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Defence of British India, the public safety, the maintenance of public order or the efficient prosecution of War etc. Under section 2(2) of the Defence of India Act the Central Government was empowered to make rules with regard to requisition of any immovable property. Sub-section (4) provided that the Central Government might by an order direct that any power or duty which by a rule under sub-section (1) was conferred or imposed upon the Central Government shall in such circumstances and under such conditions as may be specified, be exercised or discharged by any Provincial Government or by any officer or authority subordinate to such Government, or by any other authority. Rule 75A of the Defence of India Rules provided as follows: "If in the opinion of the Central Government or the Provincial Government it is necessary or expedient so to do for securing the Defence of British India, public safety, the maintenance of public order or the efficient prosecution of the War, or for maintaining supplies in services essential to the life of the community, that Government may by an order in writing requisition any property, movable or immovable, and may make such further orders as appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onent or an integral part of the latter; the need for the formation of the opinion before the power can be exercised is a limitation of the power, it qualifies its extent and is a part of the power; and the formation of the opinion and the issue of the order constitute the exercise of the power. The delegation of the power includes authority to form the opinion conditioned upon which the power can be exercised. When the power has been delegated it is the responsibility of the person, in whose favour the delegation is made, to form the opinion before he can exercise the power. The validity of the delegation of the power to the appellant is not questioned; after the delegation he was the person by whom the opinion had to be formed. This is in accordance with the decision in Kewalram v. Collector of Madras(1). " Kewalram's caseI.L.R. 1944 Mad. 826. mentioned above was also concerned with a requisition under the Defence of India Act and the Rules. Leach, C.J., said as follows: "There is here full power of delegation, but Mr. Srinivasa Ayyangar suggests that rule 75A requires the Central Government to form its own opinion on the question of the necessity for requisition and then direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or forms an opinion under section 5, he is discharging a duty and is carrying out the condition precedent laid down in section 5. Therefore, there is no substance in this point and the Collector has rightly formed the opinion necessary under section 5 before he could exercise the power to requisition the property." Apart from the authorities quoted above, the learned Advocate General draws my attention to rule 49 which lays down that when it appeared to an assessing authority to be necessary to make an assessment under section 11, he shall serve a notice in Form VI upon him. "Assessing authority" has been defined by rule 1(ii)(b) as follows: "'Assessing authority' means in respect of any particular dealer the person appointed under section 3 to whom the Commissioner has delegated his powers under section 11 in respect of such dealer." Form VI, as has been prescribed under the Rules, shows that the notice might be issued by the Commercial Tax Officer of the charge, and yet in the body of the notice it clearly appears that the person who was to be satisfied was the person who had issued the notice. It has been held in Ibrahim v. Regional Transport Authority, TanjoreA.I.R. 195 S.C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al argues that as long as the information originally came into the possession of the Commissioner, the Statute would be satisfied. This, however, is a construction which I am unable to accept. The proper way of interpreting the Act and Rules would be to hold that the Commissioner has a right to delegate, and once he has delegated the power, the name of the delegate should be substituted for that of the Commissioner. If that is done, then there is no difficulty. There is also substance in the argument of the learned Advocate-General, that the Rules and the forms prescribed thereunder indicate as to whose satisfaction would be required where power has been delegated. It is unnecessary for me to consider as to whether in Ibrahim's caseA.I.R. 1953 S.C. 79., the Supreme Court intended to hold that Rules prescribed under power conferred by an Act could be inconsistent with the provisions of the Act. In the present case I find no inconsistency at all. Mr. Sanyal argued that this is a question of jurisdiction. The Commercial Tax Officer by virtue of a delegation may have a certain power but until the wordings of the section were directly complied with, he derives no jurisdiction. It is unn ..... X X X X Extracts X X X X X X X X Extracts X X X X
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