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TMI Blog1983 (12) TMI 267X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of Rajasthan by Notification No. F. 21(7)SR/55 dated 14th April, 1955, granted exemption from payment of sales tax to dealers in allopathic medicines subject to their obtaining an exemption certificate on payment of fixed annual fee of Rs. 10. The assessee obtained an exemption certificate in accordance with the aforesaid notification, regarding the sale of allopathic medicines on 3rd June, 1957, for the financial year 1957-58. During the proceedings for assessment of sales tax for the period from 1st April, 1957, to 31st March, 1958, the assessee claimed exemption on the basis of the aforesaid certificate in respect of sales of allopathic medicines for the period from 1st April, 1957, to 5th May, 1957, as the provisions in respect of exemption were modified by the notification dated 6th May, 1957. The assessing authority, namely, Commercial Taxes Officer, Jodhpur, disallowed the assessee's claim for exemption on the ground that he had applied for renewal of the exemption certificate on 7th May, 1957, while the exemption could have been granted under the notification dated 14th April, 1955, up to 5th May, 1957, only. According to rule 12 of the Rajasthan Sales Tax Rules, 1955 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fee of Rs. 10 was prescribed. It is not in dispute that the assessee held an exemption certificate under the aforesaid notification in respect of the financial years 1956-57. It is also not in dispute that the assessee submitted an application on 7th May, 1957, for renewal of the exemption certificate. The Sales Tax Officer, Jodhpur City, issued the exemption certificate to the assessee on 3rd June, 1957, and ordered that the turnover of the assessee of allopathic and homoeopathic medicines and drugs will be exempted from payment of sales tax up to 5th May, 1957. The said exemption certificate specifically mentions that "this certificate shall be valid till the 5th May, 1957, unless cancelled earlier". It may be pointed out here that the exemption certificate issued by the Sales Tax Officer was stated to be valid only up to 5th May, 1957, because the notification dated 14th April, 1955, was partially modified by the notification issued by the State Government on 6th May, 1957, with effect from that very day and thereafter the sale of allopathic and homoeopathic medicines and drugs were exempted from payment of sales tax subject to the dealer obtaining an exemption certificate on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion certificate granted by the Sales Tax Officer in favour of the assessee on 3rd June, 1957, was a nullity and the same was rightly ignored by the assessing authority as well as by the appellate authority and the Board of Revenue. The contention of the learned Additional Advocate-General is that the submission of an application for obtaining an exemption certificate within the prescribed period of 30 days was an essential pre-requisite for the Sales Tax Officer obtaining the jurisdiction to issue an exemption certificate. It was further contended that the Sales Tax Officer was a Tribunal of limited jurisdiction and if the essential pre-requisites were not complied with, there was total absence of jurisdiction. It is, of course, not denied nor it is disputed before us that the exemption certificate granted by the Sales Tax Officer on 3rd June, 1957, was not cancelled or set aside by any competent authority, either the Sales Tax Officer himself or by any higher authority in appeal or revision. The contention of Mr. Kakkar on the other hand is that the exemption certificate issued by the Sales Tax Officer in favour of the assessee was a valid certificate of exemption in spite of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of which the order was passed. A workable test in this respect was laid down by Coleridge, J., in Holmes v. Russell (1841) 9 Dowl 487 in the following terms: "It is difficult sometimes to distinguish between an irregularity and a nullity, but the safest rule to determine what is an irregularity and what is a nullity is to see whether the party can, waive the objection; if he can waive it, it amounts to an irregularity; if he cannot, it is a nullity." In Vellayan Chettiar v. Government of the Province of Madras AIR 1947 PC 197, their Lordships of the Privy Council held that although the provisions of section 80, Civil Procedure Code, were mandatory in nature, yet the officer or authority for whose benefit they were made was entitled to waive the same. Their Lordships observed as under in the aforesaid case: "There is no inconsistency between the propositions that the provisions of the section are mandatory and must be enforced by the court and that they may be waived by the authority for whose benefit they are provided .............there appears to their Lordships to be no reason why the notice required to be given under section 80, should not be waived if the authority co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thed. The meaning and intention of the legislature must govern, and these are to be ascertained not only from the phraseology of the provision, but also by considering its nature, its design, and the consequences which would follow from construing it the one way or the other....." In State of U.P. v. Babu Ram Upadhya AIR 1961 SC 751 their Lordships of Supreme Court observed as follows: "The court may consider, inter alia, the nature and design of the statute, and the consequences which would follow from construing it the one way or the other, the impact of other provisions whereby the necessity of complying with the provisions in question is avoided, the circumstance, namely, that the statute provides for a contingency of the non-compliance with the provisions; the fact that the non-compliance with the provisions is or, is not visited by some penalty, the serious or trivial consequences that flow therefrom; and, above all, whether the object of the legislation will be defeated or furthered." If general inconvenience will be created to innocent persons without very much furthering the object of the enactment, the provision should be construed as directory. In the present cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich authorises the assessing authority to condone the delay in filing an application for obtaining an exemption certificate. If the assessing authority was satisfied that there was sufficient reason for the assessee for not obtaining the exemption certificate within the period of 30 days, such delay could be condoned on payment of penalty of Rs. 25 by the dealer for each calendar year or part thereof. Thus, it is apparent that there was no public interest involved in prescribing the provision of 30 days for filing an application for obtaining an exemption certificate nor there was any public policy behind such a provision. The obvious intention of the rule-making authority for making such a provision appears to be to regulate and control the grant of exemption certificates and the renewal thereof and to provide a reasonable period during which the dealers should normally file an application for obtaining an exemption certificate or renewal thereof. In this view of the matter, the exemption certificate granted by the Sales Tax Officer, even on the basis of an application filed beyond the period of 30 days, could not be held to be ab initio void and it could not be held that the Sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ption certificate was filed within the period of 30 days or not, was a matter which was to be considered by the Sales Tax Officer while granting or refusing to grant the exemption certificate under rule 8 or renewing the same under rule 12, but once the certificate was granted by the competent authority, the assessee was entitled to obtain an exemption in respect of sales made by the dealer up to 5th May, 1957, so long as the exemption certificate was not cancelled or set aside. The fact that the exemption certificate specifically mentions that it shall be valid up to 5th May, 1957, goes to show that the Sales Tax Officer while granting the exemption certificate on 3rd June, 1957, was conscious of the fact that the period of validity of the certificate has already elapsed and further that an exemption on the basis of such certificate could not be availed of beyond 5th May, 1957, on account of the notification dated 6th May, 1957, providing for exemption thereafter on the basis of annual turnover of the assessee. We are, therefore, of the view that the assessing authority was not justified in treating the exemption certificate as invalid, so long as it was not lawfully cancelled or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght to file an appeal before the Deputy Commissioner (Appeals) and in case his appeal is allowed, yet considerable time is bound to elapse on account of the pendency of the appeal before the exemption certificate could be granted on the basis of the appellate order. Then the exemption certificate necessarily would be granted much later in point of time than the date of its commencement and in some cases, such certificate may be granted beyond the period of its expiry. Thus, to our mind the provision contained in rule 12 relating to the period prescribed for filing of a renewal application appears to be directory. We have already observed above, that the delay in filing an application for obtaining the exemption certificate could be taken into consideration by the Sales Tax Officer at the time of granting the exemption certificate, as he has a discretion at that time to refuse to grant an exemption certificate, for which the application was filed beyond the period of 30 days. But once the exemption certificate is granted, then the assessing authority, during the course of the assessment proceedings, could not ignore the renewed exemption certificate nor could it go behind the exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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