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TMI Blog1956 (7) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... the firm had made huge imports amounting to over Rs. 3 lakhs, of which Rs. 2 lakhs were already sold in the local market. It was further stated that not only were huge stocks in hand, but goods worth nearly one and half lakhs which were in transit, would arrive in Calcutta shortly. The first hearing was fixed on the 21st of October, 1954, but for some reason or other, the case was not taken up on that date. A further reminder was given on the 23rd of October, 1954. It appears that the authorities upon receiving the application caused an Inspector of the Commercial Tax Department, by the name of Dilip Kumar Sarkar, to inspect the business place of Durga Prosad Shyamsundar and to submit his report to the Commercial Tax Officer. He called at 188 Cross Street, the address furnished in the application, and found that the firm was situate in a room on the second floor of premises No. 188 Cross Street. There he met Durga Prosad Khaitan, who represented himself to be the sole proprietor of the said firm. The Inspector inspected the vouchers, cash memos etc. and the results are incorporated in a report dated the 4th of November, 1954, a copy whereof is annexed to the affidavit of Dilip Ku ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i was issued herein, your petitioner came to know for the first time from the affidavit-in-opposition filed by and on behalf of the respondents that prior to the passing of the said order they had ever made certain enquiries behind the back and in the absence of your petitioner. Your petitioner was completely in the dark about the said alleged enquiry. The said order is opposed to the rules of natural justice." This statement is entirely false, as will appear from the facts stated above. Not only was the petitioner fully aware of the enquiry but he was present at the enquiry on the 4th of November, 1954, and actually signed the report himself. This Rule was issued on the 11th of February, 1955, upon the respondents to show cause why an order in the nature of a writ of mandamus should not be made directing the respondent Commercial Tax Officer to issue the registration certificate to the petitioner without security being demanded, and for other reliefs. Mr. Mitra appearing on behalf of the petitioner has taken the following points: (1) Section 7(4a) of the Bengal Finance (Sales Tax) Act, 1941, is void as infringing the provisions of Article 19(1)(g) of the Constitution and the res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the section becomes unworkable. Before I deal with this point further, I shall enumerate how an application for registration comes to be made. Section 4 of the Act lays down the point of time when the liability to pay sales tax commences. At that point of time, the dealer must have reached the taxable quantum. Roughly speaking, taxable quantum means, in relation to any dealer who imports for sale any goods into West Bengal or manufactures or produces any goods for sale, Rs. 10,000; or in relation to any other dealer Rs. 50,000. Under section 7, no dealer shall while being liable to pay tax under section 4 of the Act, carry on business as a dealer unless he has been registered and possesses a registration certificate. Every dealer, wishing to be registered shall make an application in such behalf, in the prescribed manner to the prescribed authority. If the said authority is satisfied that the application for registration is in order, he shall register the applicant in accordance with such rules as may be prescribed. Such rules have been prescribed in exercise of the power conferred by subsection (1) of section 26 of the said Act. Rule 5 lays down what should be the contents of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the following year. But under the new subsection, if his gross turnover from the commencement of a year exceeds the taxable quantum, then even within that year he has only two months' grace from the point of time when it so exceeds the taxable quantum, after which he becomes liable to pay the tax. Rule 5, which prescribes the contents of the application for registration, was framed before the amendment. The result is that under the rule, what has to be stated in the application form is the gross turnover of the business for the preceding year and not the turnover form the commencement of the year during which the liability arose. In other words, the rule has remained as before, and has not been brought in line with the present requirements under the amended sub-section. The learned Standing Counsel admits that this is an oversight and calls for an immediate rectification. Fortunately, however, the form itself has been suitably altered and requires the gross turnover to be given from the commencement of the current year to the date of the application. It is in this form that the petitioner had made his application for registration. The original Act did not contain section 7(4a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of circumstances would or might have produced': (per Lord Blackburn in Edinburgh Street Tramways v. Torbain[1877] 3 App. Cas. 58 at page 68.)." It is another well-known rule of interpretation of statutes that it should not be so construed as to make the meaning absurd or unworkable. It is but evident that the word "payable" in section 7(4a) (i) cannot be construed as meaning a point of time when assessment has been completed and notice of demand has been served. The point of time which is contemplated is when a dealer who has arrived at the taxable quantum applies for registration. At that time, there can be no assessment, not to speak of a notice of demand. Consequently, the word "payable" must mean "that will become payable". This meaning becomes quite clear if we compare it with section 11(4a) where it has been clearly stated that the point of time contemplated there is after assessment of tax and the expiry of the date of payment. There is, therefore, no substance in this point. Coming now to the first point, Mr. Mitra has argued that the Commissioner has been given an unfettered power without any limitation and without any indication in the Act and the Rules as to the mode o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... over, the books showed a capital of Rs. 1,000. Whether such a way of doing business is within the region of possibility or not, it is unnecessary to consider. The authorities, however, decided very rightly to be on their guard, and the further circumstances disclosed were not calculated to allay their anxiety. The shop of the petitioner turns to be elusive. It is only open for a short while during the day, and ultimately it has disappeared altogether. At the hearing, Mr. Roy who followed Mr. Mitra, argued that his client was still in his old shop and all these statements on behalf of the authorities were reckless. I therefore gave him an opportunity of showing me the rent receipts. That opportunity was not availed of, and it seems to me for obvious reasons. The authorities are therefore justified in treating this meteoric intruder into the world of business in Calcutta with a degree of suspicion, and the circumstances, in my opinion, fully justify the imposition of a security. Taking all the facts and circumstances of this case the security is by no means unreasonable. For the reasons stated above, I hold that section 7(4a) of the Act does not confer unfettered and arbitrary powe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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