9911796707
TMI Blog1969 (3) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... tax on this turnover came to Rs. 11,170. By a mistake of fact and law, the plaintiff had included, in his return for assessment of sales tax, the above-said turnover, and did not claim exemption therefor. The Deputy Commercial Tax Officer accepted the plaintiff's return and assessed him by an assessment order passed on 30th September, 1956, and which was served on the plaintiff on 24th November, 1956. Under the relevant provision in the Madras General Sales Tax Act, 1939, which was in force at the time the plaintiff was entitled to file an appeal to the Commercial Tax Officer within thirty days from the above date. But by oversight, the plaintiff filed the appeal only on 7th May, 1957, after the lapse of about six months. In the appeal, the plaintiff raised the question of exemption on inter-State purchases; but the Commercial Tax Officer dismissed the appeal, on the preliminary ground that it was barred by time. The plaintiff then took the matter in further appeal, before the Sales Tax Appellate Tribunal, under section 12-A of the Act; and, in that appeal also the Tribunal upheld the preliminary finding of the Commercial Tax Officer that the appeal was barred by time and that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made under this Act." This provision as well as the analogous provision in section 67 of the Indian Income-tax Act, 1922, and provisions in other enactments which are differently worded but intended to bring about an analogous result, for instance section 188 of the Sea Customs Act, have been the subjectmatter of several decisions of the Privy Council as well as the Supreme Court. The principles laid down in these decisions have been summarised in a recent decision of the Supreme Court in Dhulabhai v. State of Madhya Pradesh[1968] 22 S.T.C. 416. Broadly stated, the principles of these decisions, so far as the point at issue in the present appeal is concerned, appear to be the following: (1) The sales tax authority has jurisdiction to decide whether a transaction of sale (or purchase) falls within the State of Madras and therefore falls within the jurisdiction of the sales tax authority to assess it. In the same category will fall a decision as to whether a sale (or purchase) takes place outside the State or in the course of inter-State trade or in the course of import or export attracting the bar under Article 286 of the Constitution. These questions involve a decision of fact a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the amount wrongly collected. The Supreme Court held that the assessment in question, though erroneous in point of law, was an assessment under the Act within the scope of section 18-A and therefore the jurisdiction of the civil court is barred. The Supreme Court referred to certain observations in Secretary of State represented by the Collector of South Arcot v. Mask and Company[1940] 67 I.A. 222., viz., "It is also well settled that even if jurisdiction is so excluded under the provisions of section 188 of Sea Customs Act the civil courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with, or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure." The Supreme Court observed that these observations were somewhat wide in their nature, and they held that non-compliance with the provisions of the statute, to which reference was made by the Privy Council, must be non-compliance with such fundamental provisions of the statute, as would make the "entire proceedings" before the appropriate authority illegal and without jurisdiction. Learned counsel Sri M. S. Venkatarama Iyer appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rictly not liable to be taxed." Sri Viswanatha Sastri who appeared before the Supreme Court for the dealer put forward an argument similar to the one put forward by Sri M.S. Venkatarama lyer in this case that a transaction which is excepted from assessment either by virtue of Article 286 or by virtue of any specific statutory provision cannot be validly assessed, and an assessment made in respect of it cannot claim the status of an assessment made under the Act within the meaning of section 20 of the Bombay Sales Tax Act (corresponding to section 18-A) and that a suit would, therefore, be competent to challenge such an invalid assessment. The Supreme Court repelled this argument by observing that, if the appropriate authority has been given jurisdiction to determine the nature of the transaction and proceed to levy a tax in accordance with its decision on the first issue, then the decision on the first issue cannot be said to be a decision on a collateral issue, and even if the said issue is erroneously determined by the appropriate authority, the tax levied by it in accordance with its decision cannot be said to be without jurisdiction. They, therefore, held that even if a mistake ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the Supreme Court in Dhulabhai v. State of Madhya Pradesh[1968] 22 S.T.C. 416. That was a case where the sales tax authority in Madhya Pradesh assessed a dealer in beedies to sales tax under section 3 of the Madhya Bharat Sales Tax Act (Act 30 of 1950). Under the above section and further notifications issued by the Government tax was imposed at different rates on tobacco imported from outside the State on the importer at the point of import. But tax was not levied on sale or purchase of tobacco of similar kind locally acquired in Madhya Bharat. The taxing provisions, in the above circumstances, were struck down by the High Court because it was hit by Article 301 of the Constitution and the decision of the High Court was confirmed by the Supreme Court in State of M.P. v. Bhailal Bhai(2). Thereafter the dealer filed suits for recovery of the illegal tax collected. The Supreme Court in Dhulabhai's case(1) referred to the earlier decision in Bhailal Bhai's case[1964] 15 S.T.C. 450. striking down the charging section as being opposed to Article 301 of the Constitution, and held that the principle decided in Venkataraman's case[1966] 17 S.T.C. 418. would be directly applicable, an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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