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TMI Blog1978 (3) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee having regard to the state of law then prevailing. However, consequent upon the amendment of section 15 of the Central Sales Tax Act, 1956, by the Central Sales Tax (Amendment) Act, 1972, with effect from 1st October, 1958, the validation provision contained in section 15 of the Central Sales Tax (Amendment) Act, 1972, and consequential amendments made to the principal Act by Karnataka Act 7 of 1973, the Deputy Commissioner of Commercial Taxes (Appeals), Bangalore-the appellate authority-with the object of rectifying the earlier orders made by him on 28th January, 1969, and 25th March, 1969, in the appeals referred to earlier, initiated proceedings under section 25-A of the principal Act, which was introduced by the Karnataka Sales Tax (Second Amendment) Act, 1970, hereinafter to be referred to as the Amendment Act, for rectification by issuing to the assessee a notice dated 13th August, 1973, informing it of the proposed rectification and calling upon it to appear and show cause against such proposal on the date of hearing of the cases, fixed for 15th August, 1973. As a result of an adjournment of the cases on 15th August, 1973, another notice was issued to the assessee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the learned counsel for the petitioner was attempted to be made good on the interpretation sought to be placed by him on sub-section (1) of section 25-A of the principal Act as amended by the Amendment Act and the proviso thereto. But, when his attention was invited by us to the provision in section 8 of the Amendment Act as the one which would squarely meet the contention raised by him, he was not able to demonstrate before us as to how the said provision was not applicable to those cases, even though a feeble attempt was made by him in the said regard. Having regard to the contention raised on behalf of the petitioner and the provision enacted in section 8 of the Amendment Act, the question of law which arises for our decision in these revision petitions can be formulated thus: Whether proceedings under section 25-A to rectify mistakes apparent from the record in any order made under the principal Act, by an assessing authority, appellate authority, revising authority, the Appellate Tribunal or the High Court, at any time before the commencement of the Amendment Act, can be considered to have not commenced within the meaning of section 8 of the Amendment Act, until a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee a reasonable opportunity of being heard." Though the provisions of sub-section (6-A) of section 22, sub-section (7-A) of section 23 and sub-section (1) of section 25-A of the principal Act as amended by the Amendment Act, require that the person or the department to be adversely affected by the proposed rectification should be given a reasonable opportunity of being heard before an order of rectification is actually made, the language of the provisos does not even remotely suggest the inference that the proceedings for rectification of orders made under the principal Act prior to the coming into force of the Amendment Act, cannot be considered to have commenced unless notices of the proposed rectification are served on the parties who are likely to be adversely affected. The provisions contained in the sub-sections referred to earlier no doubt provide that an order passed by an assessing authority, appellate authority, revising authority, the Appellate Tribunal or the High Court, as the case may be, may be rectified by amending such an order at any time within the period specified therein. However, it may not be out of context to mention that on a consideration of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on section 25-A(1) and its proviso, as we propose to rest our decision on the question as to when the proceedings of rectification in respect of orders made under the principal Act prior to the coming into force of the Amendment Act commence, upon the construction we would be placing on the express and unambiguous language of the provision in section 8 of the Amendment Act, which reads: "8. Limilation for making order of rectification of mistakes in certain cases.-Notwithstanding anything contained in sections 22, 23 and 25-A of the principal Act as amended by this Act, proceedings to rectify mistakes apparent from the record in any order made under the principal Act by an assessing authority, appellate authority, revising authority, the Appellate Tribunal or the High Court, at any time before the commencement of this Act may be commenced within five years from the date of such order or one year from the date of the commencement of this Act whichever is later." Though a cursory look at the provision gives the first impression to the person who looks at it that it is a redundant provision in view of 5 years' period of time allowed for rectification, in sub-section (6-A) of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Sales Tax Act, 1956 (Central Act 74 of 1956), in respect of such sale..........." But in Munshi Abdul Rahiman and Bros. v. Commercial Tax Officer[1967] 20 S.T.C. 89., a Division Bench of this Court struck down a part of the rule which read: "and has paid tax under the Central Sales Tax Act, 1956 (Central Act 74 of 1956), in respect of such sale." This decision made it possible for the assessees of declared goods to claim the benefit of refund on the ground that the sales effected by the assessees are second sales and without showing that their sellers had in fact paid tax. Refunds were also obtained by the assessees in innumerable cases, pursuant to the said decision. Further, the validity of rule 38(1) made under the Mysore Sales Tax Act, which provided for rectification, was under challenge in several writ petitions filed before this court. It is these circumstances and other circumstances following the decision of the Supreme Court in Yaddalam Lakshminarasimhiah Setty's case[1965] 16 S.T.C. 231 (S.C.); A.I.R. 1965 S.C. 1510. and the consequent amendment of the Central Sales Tax Act by the Central Sales Tax (Amendment) Act (28 of 1969), which led the State Legislature to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ); A.I.R. 1940 P.C. 124., in which it is held: "The section, although it is part of a taxing Act, imposes no charge on the subject, and deals merely with the machinery of assessment. In interpreting provisions of this kind the rule is that that construction should be preferred which makes the machinery workable, ut res valeat potius quam pereat." We shall now examine section 8 of the Amendment Act in the light of the above rule of construction. There is nothing in section 8 of the Amendment Act which would suggest the making of the commencement of the proceedings of rectification depend upon the service of notice of the proposed rectification either on the assessee or on the assessee and the department, as the case may be. Moreover, such a possibility cannot even be envisaged, for it would lead to anomalous results and may even lead to evasion of tax which has been validly imposed. Let us consider a case where the High Court has to exercise its power of rectification in respect of an order made by it prior to the coming into force of the Amendment Act. What does it do for starting or initiating a proceeding? It will look into the order requiring rectification and make an or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chever is later" confers in clear terms wide power on the authority concerned or the Appellate Tribunal or the High Court, to commence the proceeding of its own accord. We are of the view that the words "may be commenced" used in section 8 of the Amendment Act are to be construed as "may be originated" or "may be begun" and such commencement, origination or beginning of the proceeding to rectify may be made by the authority concerned or the Appellate Tribunal or the High Court by resorting to any overt act including the issue of notice to the party likely to be adversely affected. When once such overt act is found to be available in a given case within the period of limitation prescribed under section 8 of the Amendment Act, then the rectification proceeding shall be considered to have commenced. This is our decision on the question of law which has arisen for consideration in these petitions. It is not disputed by the learned counsel appearing for the petitionerassessee, that notice of rectification proceeding was in fact issued to the assessee-petitioner within the period of limitation prescribed under section 8 of the Amendment Act. In the said view of the matter, we do not se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at some of the decisions cited before us which were based on the provisions of section 34 of the Income-tax Act, 1922, or sections 147 to 149 of the Income-tax Act, 1961, have no bearing on these cases as the scheme of those sections is different from the scheme of section 25-A of the principal Act. Hence we have not chosen to deal with them specifically. Thus no justifiable grounds are made out for interfering with the order of remand made by the Tribunal. The only other contention raised before us by the learned counsel for the petitioner was that the Tribunal was not justified in not refunding the institution fee in the appeals before it when it remanded the cases to the appellate authority for fresh disposal on the ground that the orders appealed against were made by the appellate authority without affording the assessee-appellant a reasonable opportunity of hearing. We have perused the order of the Tribunal and found that no reasons are given for refusing the refund of the institution fee. We feel that there is no valid reason for the Tribunal to deny the refund of the institution fee which it was authorised to refund under rule 30(3) of the Karnataka Sales Tax Rules. We d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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