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TMI Blog1958 (4) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... the Government of Madhya Bharat in exercise of their powers under section 4 of the Madhya Bharat Sales Tax Act, 1950, and published in the Madhya Bharat Government Gazette dated 22nd May, 1950. The Sales Tax Officer consequently assessed the petitioner in respect of the assessment year to a sum of Rs. 90,421-11-3 as the amount of sales tax and directed issue of notice of demand by his order dated 29th November, 1954. The petitioner preferred a revision petition against this order of the Sales Tax Officer to the Commissioner, Sales Tax, under section 12(2) of the Sales Tax Act, 1950, on 23rd April, 1955. This petition for revision was not accompained by the satisfactory proof of payment of full tax determined in respect of the period for which the revision was preferred. The petitioner's contention before the Sales Tax Commissioner in respect of this payment was that the provision for such payment was introduced by means of an amendment to section 11 of 1955 (sic) which was published in the Madhya Bharat Government Gazette dated 15th April, 1955, and that as such the same was not applicable to the cases of orders passed prior to that date. The Sales Tax Commissioner did not ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Rabindralal Barua and AnotherA.I.R. 1956 Assam 114. in support of his contentions. He further relied upon the decision in Nana Bin Aba (Original Plaintiff) v. Sheku Bin Andu and Others (1908) I.L.R. 32 Bom. 337 at p. 344, Colonial Sugar Refining Company, Ltd. v. Irving[1905] A.C. 369. and Commissioner of Income-tax, C. P. v. Dharamchand Dalchand of SaugorA.I.R. 1924 Nag. 24. for the view that the right of appeal is a vested right and in the absence of a specific provision to the contrary that right cannot be affected or interfered with by reason of subsequent amendments to the statute. He further relied upon the decision in Gordhan Das, Baldev Das v. Governor-General in CouncilA.I.R. 1952 Puni. 103., which quoted the observations in AttorneyGeneral v. Sillem10 H.L.C. 703., explaining the meaning of the term of appeal. On the other hand, learned counsel appearing on behalf of the Government contended that there is a real and substantial difference between the two kinds of remedies and that the two are by no means co-extensive. The appeal is a remedial right conferred upon a party to take his matter to a superior Court for redressing the error committed by the lower Tribunal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... While considering the first question it will be useful to indicate the material provisions pertaining to appeal and revision under the Madhya Bharat Sales Tax Act. Section 11 of the Act provides for an appeal at the instance of an assessee against an order of assessment, refund or penalty. Such an appeal has to be preferred within sixty days from the date on which he was served with a notice of demand or a copy of the refund order. The appellate authority ought to give a hearing to the aggrieved assessee and then either confirm, modify or annul the assessment or remand the case to the assessing authority. Order passed by the appellate authority is specifically made subject to the power of revision conferred under section 12 of the Sales Tax Act upon the Commissioner and of reference made to High Court under section 13 of the Sales Tax Act. Section 12(1) of the Sales Tax Act empowers the Commissioner to exercise his discretion and call for and examine the records of any proceedings under the Act either suo motu or on being moved by an assessing authority if the order of the assessing authority be prejudicial to the interest of revenue and to pass such order therein as he thinks fit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... styling this remedy under section 12 as one of revision may have been to confer a limited kind of right. Since for acting in the interest of the revenue the Commissioner could act suo motu and also on being moved by an assessing authority to whom no right of appeal is conferred it might have been thought advisable to style this remedy as one of revision to distinguish it from that of appeal. Now while acting in the interest of revenue if a Commissioner is empowered to examine merits it would have been illogical not to permit him to do so while acting at the instance of an aggrieved assessee. The assessee too therefore was allowed to approach him and this power too was put in the same category of revision. I am, therefore, of the view that apart from authorities on the scheme of the Act itself the remedy by way of revision available to an assessee is a right. It makes no real and practical difference whether the remedial provision in one case refers to the right of an assessee and in the other case to the power of the Commissioner. Where, as in the latter case there is power to the Commissioner to revise at the instance of an assessee after examining the merits there is a corresp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to give relief where the stakes involved were small, and introduced the revisional power again. An assessee can either prefer an appeal to the Appellate Tribunal or he may select the cheaper remedy and apply to the Commissioner to revise the order. If he so elects, if the time prescribed for preferring an appeal has not expired, he must waive his right to prefer an appeal. The object of the sections is clear. The assessee can agitate the validity of the order of the subordinate authority either before the Tribunal or the Commissioner. That was the intention of the legislature, and, in my view, the provisions of the aforesaid two sections clearly bring out the intention." Further he observed at page 349: "But if a party takes the remedy provided by the Act in strict conformity thereof but the Tribunal constituted under the Act refuses to discharge its duties provided by the same Act, it is not open to the Tribunal or the authority to say that he cannot be compelled to discharge his statutory functions. Section 45 is intended only to govern such cases and to compel officers to discharge their statutory duties. I therefore also reject this argument." This case and the observations of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Collector under the new Act of 1906. There was no such remedy under the Act of 1876 under which the proceedings were started. On these facts it was held by Sir Lawrence Jenkins, C.J., and Batchelor, J., that the Repealing Act cannot give right of revision in respect of proceedings commenced under the Mamlatdars' Courts Act, 1876. This decision which is by a distinguished jurist clearly brings out both the points involved in this case, viz., remedy by way of revision is a right and that when the right is once vested it is not conferred or taken away merely by reason of subsequent amendment in the absence of specific provision to that effect. This case and the observations of his Lordship Sir Lawrence Jenkins, C.J., fully apply to the present case. The authorities relied upon by the learned counsel for the opponent in support of the line of reasoning put forward by him will now be dealt with. The first case relied upon is Dinshaw Iron Works v. Miakhan Adamji and Co.A.I.R. 1943 Bom. 42. In this case Beaumont, C.J., and Wassoodow, J., had to consider the language of section 38 of the Presidency Small Cause Courts Act which provides as follows: "That where a suit has been contested, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s subordinate to the High Court. His Lordship repelled that contention holding that a Court can be said to be subordinate to another Court only if the latter Court has appellate or revisional jurisdiction or power of superintendence given by some statutory provision. His Lordship further pointed out that the order of the District Magistrate under section 318 is final by the very terms of section 321 of that Act. It is in this connection that his Lordship observed that there is no analogy between a reference and an appeal inasmuch as an appeal is if preferred by a party whereas a reference is made by a Court and not by a party. These observations made in this context cannot be taken to throw much light upon the question whether the remedial provision in question can be taken to be available to a party as of right. The observations of the learned author in Chitaley's Commentary on the Code of Civil Procedure in connection with the term "appeal" made in note No. 3 of section 96, Civil Procedure Code, appear to have been based practically on these decisions. The learned author says: "Appeal differs from a revision." In appeal points to be decided are those on which the parties are at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dely discretionary as regards the question whether the occasion for its exercise arose or not, it was held that the Bishop could not have declined to hear the complainant nor, if his judicial discretion, uninfluenced by considerations foreign to his duty, had decided that the occasion for it had arisen, could consistently with the intention of Legislature, have refused to issue commission. The actual decision in the aforesaid Full Bench case can be explained on the ground that the Court having discretionary power could act within the limits of self-imposed restrictions which would be uniformly applied to all cases and are not contrary to justice and equity. Thus considering the cases cited on behalf of the opponent it does not follow that the remedy by way of revision available to an applicant under section 12(2) of the Sales Tax Act is not a right nor does it follow that restrictive provisions of the Amended Act ought to be held to be applicable to such a proceeding although the assessment order was passed before the date of amendment. Reference in this connection may be made to the decision of the Privy Council in Commissioner of Income-tax v. The Tribune Trust, Lahore[1948] 16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e third question and is vital to the respondent's case, that it affords a claim to relief. As has been already pointed out, appropriate relief is specifically given by other sections: it is not possible to interpret section 33 as conferring general relief." The observations of their Lordships ought to be construed in the light of the wording of section 33 as it then stood. There was no specific provision in that section entitling the assessee to apply in revision to the Commissioner for calling for the record of the case. It was contended that such a right existed because the Commissioner of Income-tax was a public officer and the power vesting in him to call for the record suo motu imposed upon him a duty which he was bound to perform upon the application of the assessee and the case of Bishop of Oxford(1) was referred to in this connection. Their Lordships on considering the wordings of the section held that the words in the section were so inapt as not to create a duty. According to them the wording and the general scheme and arrangement of various sections material for the purpose indicated that the provision was intended to serve as an administrative machinery by which higer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such appeal may be made has not expired, or, in the case of an appeal to the Appellate Tribunal, the assessee has not waived his right of appeal, or (b) where an appeal against the order has been made to the Appellate Assistant Commissioner, the appeal is pending before the Appellate Assistant Commissioner, or (c) the order has been made the subject of an appeal to the Appellate Tribunal: Provided further that an order by the Commissioner declining to interfere shall be deemed not to be an order prejudicial to the assessee. (3) Every application by an assessee under sub-section (2) shall be accompanied by a fee of twenty-five rupees." The new provision by its clause 2 entitled the aggrieved assessee to apply to the Commissioner within one year from the date of assessment and it also empowered the Commissioner to modify the order of assessment, of course, not to the prejudice of the assessee. With these specific provisions it is no longer necessary to rely upon what their Lordships expressed as "the words so inapt". There is a specific provision entitling the assessee to invoke the jurisdiction of the Commissioner. I therefore feel that had the present section 33-A been before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arat Sales Tax Act but on 23rd April, 1955, it applied to the Commissioner, Sales Tax, to revise the assessment in exercise of his powers tinder section 12 of the Act. During the interval section 12 of the Sales Tax Act was amended and the amendment was brought into force with effect from 15th April, 1955. By this amendment it was provided that no revision application shall be entertained by the Commissioner unless it was accompanied by a satisfactory proof of the payment of full tax determined in respect of which the revision has been preferred. As the revision application filed by the petitioner on 23rd April, 1955, was not accompanied by such proof the Commissioner refused to consider and entertain it. Aggrieved by this refusal of the Commissioner to entertain the revision application, the petitioner approached this Court by a petition under Article 226 of the Constitution for a suitable writ to be issued to direct the Commissioner, Sales Tax, Madhya Bharat, to exercise jurisdiction vested in him under section 12 of the Act and to entertain and to dispose of on merits the revision application filed by it on 23rd April, 1955. The petitioner had contended before the Commissioner, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but submitted after such amendment came into force and if so, whether by virtue of such amendment a condition of prepayment of tax assessed can be imposed precedent to the entertainment of such revision? (4) Whether due to the stay order passed by the Sales Tax Commissioner it was still necessary for the assessee to pay as per added proviso the full amount of assessed tax at the time of filing the revision application when the period of stay so granted had not expired? The judgment of the Commissioner does not show that question No. 4 was raised before him by the petitioner and was at any rate not pressed during the arguments before us. It is therefore unnecessary to consider it. As regards the other three questions, they overlap each other. The main point raised and argued by the petitioner was question No. 2. I shall therefore deal with it. Mr. Bhargava, learned counsel for the petitioner put the matter thus: He contended that section 11 of the Madhya Bharat Sales Tax Act conferred on the assessee a right of appeal. Similarly, section 12 conferred a right of revision. Upon this hypothesis he submitted that the revision application filed by the petitioner would be governed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and conclusive and the Legislature can hardly have intended in the next section to give a right of appeal in every contested suit. Section 38 does not in terms confer a right of appeal upon any party; the right conferred is upon the Court, to be exercised on the application of a party. I agree with the view which has been expressed in a good many cases, and particularly in In re ShivIal Padma(1), that the powers under section 38 are revisional in character. These decisions indicate that whereas an appeal is a right conferred on a party, the revisional jurisdiction is concerned with the powers conferred upon a Court. The question raised in this case, namely, whether a revision, like an appeal, is a substantive right of the party and is governed by the law in force on the date of commencement of the proceedings, came up for consideration before a Full Bench of the Madhya Bharat High Court in Jardansingh v. Karansingh(1910) I.L.R. 34 Bom. 316.. That was a case of a revision application filed in the High Court under section 545 of the Gwalior Civil Procedure Code. During the pendency of the revision application, the Gwalior Civil Procedure Code was repealed and the Code of Civil P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en made, it will be useful to examine the scheme of the Madhya Bharat Sales Tax Act itself to ascertain whether section 12 of the Act is intended to confer on the assessee an alternative remedy and whether it is open to the assessee to waive his right of appeal and to approach the Commissioner directly in revision and to insist that his grievance in the matter of assessment should be heard and redressed by that authority. The Madhya Bharat Sales Tax Act came into force with effect from 1st May, 1950. Section 3 of that Act is the charging section and defines the incidence of taxation. Under the conditions mentioned in that section, every dealer is liable to pay tax on the taxable turnover in respect of the sales or supplies of goods effected in the previous year. Section 5 prescribes the minimum and the maximum rates at which the tax is payable by a dealer under the Act. Section 6 provides that no manufacturer or importer of goods shall, while being liable to tax under this Act, carry on business as a dealer unless he has taken a licence on payment of the prescribed fee and has obtained a registration certificate. Sections 7 and 7-A relate to submission of returns and furnishing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to pass a fresh order after such inquiry as may be directed. It is necessary under this sub-section for the appellate authority to afford the appellant a reasonable opportunity of being heard and it appears that the Legislature intended that no order should be passed in appeal unless an opportunity of being heard is given to the appellant. Sub-section (4) confers finality on the order passed in appeal subject to the powers conferred by section 12 on the Commissioner and by section 13 on the High Court. Subsection (5) lays down that when the appellate authority reduces the amount of tax, the excess, if realised, shall be refunded. The provisions of the Act mentioned above have thus exhaustively defined the obligations and the remedies of the taxpayer. Then follows section 12 which deals with the revisional powers of the Commissioner. It is as follows: "12. (1) The Commissioner may in his discretion at any time suo motu or being moved by the assessing authority call for and examine the record of any proceedings under this Act and if he considers any order is illegal or improper or erroneous in so far as it is prejudicial to the interests of the revenue he may pass orders as he thin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry manner. Subsection (1) of section 12 expressly mentions that the Commissioner may in his discretion exercise these powers. Both in its context and in its language, section 12 thus seems to be inappropriate and ill-designed for the purpose of establishing a right of relief. Section 11 gives finality to the order passed in appeal. The Legislature can hardly have intended by the very next section to confer upon the assessee a "right of revision" somewhat analogous to a "right of appeal". Section 11 provides that the appellant shall be given an opportunity of being heard before any order is passed in appeal. There is no corresponding right conferred on the assessee by section 12 and the Commissioner is not under any obligation to hear the assessee unless the order that he proposes to pass is likely to prejudice the assessee. The proviso to the section indicates in the plainest possible language that the refusal by the Commissioner to interfere in revision shall not be deemed prejudicial to the assessee. The scheme of the whole Act and the language of section 12 cannot in my opinion bear the construction sought by the assessee. As observed by the Full Bench of the Madhya Bharat Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y him on the ground of equity and good conscience though the assessment had been made and the tax received in good faith. Their Lordships rejected the contention and held: "Their Lordships cannot accept this argument. They have reviewed the Code of Income-tax law for the purpose of showing that it exhaustively defines the obligations and remedies of the taxpayer. It would be wholly incompatible with this that he should have a collateral right, necessarily vague and ill-defined, founded on the principles of equity and good conscience. Their Lordships are of opinion that the only remedies open to the taxpayer, whether in regard to appeal against assessment or to claim for refund, are to be then found within the four corners of the Act. This view of his rights harmonises with the provision of section 67, to which reference has already' been made, that no suit shall be brought in any civil court to set aside or modify any assessment made under the Act. It is the Act which prescribes both the remedy and the manner in which it may be enforced." A further question was raised before the Privy Council, namely, whether the assessees could be denied the relief claimed by them under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 33-A of the Indian Income-tax Act the legislature added sub-section (2) which is similar to section 12(2) of the Madhya Bharat Sales Tax Act. It was argued that sub-section (2) made a material change in the matter of revisional jurisdiction and was enacted to get over the decision of the Privy Council in the Tribune Trust case(1). I do not think this contention to be well-founded. In the Tribune Trust case(1), their Lordships came to the conclusion that section 33 of the Indian Income-tax Act created no right in the assessee on examination of the whole scheme of that Act and on the language and the context in which section 33 was enacted. On behalf of the respondents, the well-known principle which was discussed in Julius v. Bishop of Oxford[1948] 16 I.T.R. 214; A.I.R. 1948 P.C. 102. was invoked before their Lordships and it was urged that the section which opens with the words, 'The Commissioner may of his own motion,' imposed upon him a duty which he was bound to perform upon the application of an assessee. Their Lordships refused to accede to the contention holding that"It is possible that there might be a context in which words so inapt for that purpose would create a duty." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e authority may review the acts of his subordinate and take action. These provisions did not confer a right of revision and are not meant to confer a general relief. The learned Judge failed to notice these observations and with great respect to the learned Judge I am unable to agree with the view expressed by him. The last case on which great stress was laid by the learned counsel for the petitioner is a recent decision of the Assam High Court in Hanuman Prasad v. Rabindralal Barua A.I.R. 1956 Assam 114. That case was no doubt very similar to the case before us. In that case the learned Judges of the Assam High Court were considering the provisions similar to those contained in section 12 of the Madhya Bharat Sales Tax Act. They held that that section conferred a right of revision on the party and that right must be governed by the law in force on the date the proceedings under the Act were initiated. In that case the learned Advocate-General conceded that revision was a matter of right and the question whether it was in fact so, was not raised and was therefore not discussed. The observations of the learned Judges therefore cannot be held to be conclusive with respect to the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the interests of the revenue he may pass orders as he thinks fit: Provided that no order shall be passed prejudicial to a dealer without giving him an opportunity of hearing: Provided further that the Commissioner shall not revise an order which has been made more than two years previously. (2) The Commissioner may on application for revision of an order by a dealer under this Act made within six months of the date of the order, call for the record of the proceedings in which the order complained against was passed and after examining the record, subject to the provisions of this Act, pass such order not prejudicial to the assessee, as he thinks fit: Provided that an order declining to interfere shall be deemed not prejudicial to the assessee: Provided 'secondly' that no revision shall lie if there is time for filing an appeal or if an appeal is pending before the appellate authority: Provided still further that no application shall be entertained under this sub-section unless it is accompanied by a satisfactory proof of the payment of full tax determined in respect of which the revision has been preferred." This section, as originally enacted, did not contain the third proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but submitted after such assessment came into force and if so, whether by virtue of such amendment a condition of prepayment of tax assessed can be imposed precedent to the entertainment of such revision? According to the learned Judges, who first heard this reference, all these questions overlapped each other, but the main issue raised in the reference was whether section 12 conferred on an assessee a right of revision akin to a right of appeal vesting in the assessee on the date of the commencement of the assessment proceedings. Nevaskar, J., took the view that section 12 conferred a right of revision on the assessee and that this right vested in him at the time of the initiation of the assessment proceedings and was not affected by the amendment in section 12 of the Act, and further that in the present case the assessee had a legal right to have his petition for revision heard by the Commissioner without payment of tax as required by the third proviso to section 12(2) of the Act. Samvatsar, J., was of the opinion that section 12 merely conferred the power of revision on the Commissioner and did not confer on the assessee any right to a general relief. Before me, learned couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of revision conferred on the Commissioner is as wide as and indistinguishable from the appellate powers under section 11 and whether the principle discussed in Julius v. Bishop of Oxford(1880) 5 App. Cas. 214. could be invoked to say that section 12(2) imposed on the Commissioner a duty of correcting the order if it was not in accordance with law, which duty he was bound to perform upon an application of the dealer. But it must be said that when section 11 expressly gives a right of appeal to a dealer, when the finality conferred on an order passed in appeal is subject to the power of revision conferred upon the Commissioner under section 12 and on the High Court under section 13, it would be wholly incompatible to say that the discretionary revisional jurisdiction of the Commissioner under section 12(2) which is subject to certain limitations introduces an alternative category of remedy akin to and competitive with the remedy of an appeal under section 11. The words "may on application for revision of an order by a dealer", when read in the context of section 12(2) only, do not provide anything more than a procedure for invoking the revisional jurisdiction of the Commissioner. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght of a reference to the High Court is not a mere matter of procedure but is a substantive right which vested in the dealer under the law prevailing at the date of the initiation of assessment proceedings. This involves the consequence that the procedure under section 12(2) of moving the Commissioner to exercise his revisional power really concerns the substantive right of the dealer to take the matter to the High Court, albeit on questions of law, which inhered in him from the commencement of the assessment proceedings. On this view and on the application of the well established rule of interpretation giving prospective operation to statutes taking away or impairing a vested right acquired under the existing law when the restrospective intention is not manifest by express words or necessary implication, it must be held that the third proviso to section 12(2) which was inserted in 1955 and became operative from 15th April, 1955, cannot apply to an application made by a dealer for revision of an order under the Act passed in assessment proceedings initiated before 15th April, 1955. The imposition of the condition of the payment of entire assessed tax as condition precedent to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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