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TMI Blog1992 (8) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... essment proceedings before the Sales Tax Officer (Enforcement), Unit I without raising any objection pertaining to his jurisdiction to proceed with the assessment. Assessment order was passed. It was unsuccessfully challenged on merits in first appeal before the Commissioner. The assessee preferred second appeal again on merits before the Sales Tax Tribunal. Thereafter, for the first time, a preliminary objection was raised to the original order of assessment on the ground that it was void because the transfer of the case from Sales Tax Officer, Unit II to Sales Tax Officer (Enforcement), Unit I by the Deputy Commissioner was without granting any hearing to the assessee as required under section 70 of the ST Act. The Tribunal upholding th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich the phraseology "in the same city, locality or place" appears and placement of different words used therein, it seems to us that the words "city", "locality" or "place" will have to be read disjunctively and not adjunctively. The use of comma between the words "city" and "locality" and the use of the word "or " between the words "locality" and "place" are significant. If legislative intent was to grant hearing even when the case is to be transferred from one place to the other place in the same locality or city, the words "locality" and "city" were redundant. Similarly, if legislative intent was to grant hearing even when the case is to be transferred from one locality to the other locality in the same city, the word "city" was redundan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithin the city as well as area on the outskirts of the city and the two offices may not be situated in the city boundaries though they may be situated in the same locality. 6.. The expression "in the same city, locality or place" is not appearing in section 70 of the ST Act for the first time. It has been bodily lifted by a scissor and paste operation from section 127 of the Income-tax Act, 1961 (the IT Act). The said expression in the context of the IT Act has a legislative background which cannot be ignored in appreciating its true meaning. Section 5(7A) of the Income-tax Act, 1922, permitted transfer of a case from one Income-tax Officer to the other despite provisions of section 64(1)(2) of the said Act which provides for assessments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner before the transfer is not necessary, though he is bound to record the reasons for the transfer. 8.. Whether the requirement of hearing contemplated under section 70 is mandatory in character is the next question. Considering the object of the section 70 and the use of the expression "wherever it is possible to do so" in the said provision, it seems to us that the requirement of hearing before granting transfer is not mandatory. The requirement is only directory in character and in appropriate cases it can be dispensed with by the Commissioner. Thus, the assessment order does not become void ab initio, in the absence of prejudice. 9.. There is yet another angle to the controversy. The assessee did not raise any such objec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondents is right in canvassing that the theory of waiver, acquiescence or estoppel does not apply to cases of inherent lack of jurisdiction. Distinction between inherent lack of jurisdiction and irregularity in exercise of jurisdiction is well-known and has been noticed by a catena of Supreme Court decisions. One such decision is Central Potteries Ltd. v. State of Maharashtra [1962] 13 STC 472 (SC); AIR 1966 SC 931 from which we reproduce the following material observations: "In this connection it should be remembered that there is a fundamental distinction between want of jurisdiction and irregular assumption of jurisdiction, and that whereas an order passed by an authority with respect to a matter over which it has no jurisdiction is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ready moved the Tribunal. The petitioner has explained the reason why this petition has been filed. On the basis of the view taken in this matter, Tribunals as well as the sales tax authorities have started quashing such assessment orders resulting into irreparable loss to the department. Number of such cases is reported to be approximately 5,000 involving substantial revenue. No question of law is involved. Having regard to the totality of all these factors, we are not inclined to throw the petition out on the ground of existence of alternate remedy and hence we overrule the preliminary objection. 15.. To conclude, this writ petition is allowed. The impugned order of the Tribunal is quashed and set aside. The matter is now remitted back ..... X X X X Extracts X X X X X X X X Extracts X X X X
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