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TMI Blog1995 (8) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... Division Bench in the above tax cases correctly puts the issue for decision by this Full Bench. 2.. To appreciate the question for decision we must first be conversant with the facts of the case. In all the tax (revision) cases taken out by the Revenue, the facts are more or less common and to avoid repetition we will set out the facts in T.C. No. 509 of 1995 and give the corresponding dates in respect of other tax cases in the form of a tabular column. In T.C. No. 509 of 1995 relating to an assessment for the year 1986-87 under the Tamil Nadu General Sales Tax Act, 1959 (hereinafter called "the Act"), the total turnover of the respondent/ assessee was fixed at Rs. 13,52,590 by the assessing authority by an order dated December 30, 1988, rejecting the return of the assessee and placing reliance on the inspection made by the enforcement wing officials on August 28, 1986. The order of assessment contained a note that an appeal against the order could be preferred before the Appellate Assistant Commissioner within 30 days of the order. The total tax payable was determined at Rs. 67,651 and a penalty of Rs. 18,652 was also levied under section 12(3) of the Act. There was also a lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the dates of payment of admitted tax. We have set out below a tabular column giving the necessary dates in respect of each of the tax (revision) cases, except T.C. Nos. 1483 and 1484 of 1992. Tax case No. Date of receipt of the assesment order Last date for filing the appeal Actual date of filing of the appeal Actual date of payment of the admitted tax No. of days of delay in the payment of admitted tax 509 and 510 of 1995 1-02-89 3-03-89 1-03-88 30-03-88 28 1380 of 1992 17-12-87 16-01-88 14-01-88 15-02-88 44 1464 of 1992 27-12-86 26-01-87 23-01-87 Tax on 22-1-87 AST SC on 27-02-87 32 1470 of 1992 29-12-88 28-01-89 2-02-89 20-02-89 23 1482 of 1992 15-04-87 14-05-87 1-06-87 19-10-87 154 1566 of 1992 06-10-88 5-11-88 28-10-88 20-12-88 46 521 of 1993 28-02-89 30-03-89 27-03-89 24-04-89 25 605 and 606 of 1993 15-04-89 14-05-89 14-05-89 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admit an appeal presented after the expiration of the first mentioned period of thirty days if he is satisfied that the appellant had sufficient cause for not presenting the appeal within the first mentioned period: Provided further that in the case of an order under section 12, section 12-A, section 14, section 15 or sub-sections (1) and (2) of section 16, no appeal shall be entertained under this sub-section unless it is accompanied by satisfactory proof of the payment of the tax admitted by the appellant to be due or of such instalments thereof as might have become payable, as the case may be." 7.. It has to be remembered that it was only by the Tamil Nadu Act 76 of 1986 that the first proviso was amended to prescribe an outer maximum period of 15 days up to which the delay could be condoned, by the appellate authority if sufficient cause is shown by the appellant for not preferring the appeal within 30 days from the date of receipt of the order against which appeal is filed. Before that any length of delay could be excused if sufficient cause was shown. Apparently, with a view to avoid indiscriminate resort to such a power and abuse of the same, the Legislature introduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ining the appeal arises. If the furnishing of proof happens to be after the expiry of the period prescribed, the question will arise as to whether the appeal should be admitted or not. In such cases the first proviso to section 14(1) will be attracted. And the question must be whether there has been sufficient cause for not preferring the appeal within the statutory period, viz., 30 days of the date of service of the assessment order." The Kerala High Court made it clear that the correct approach is to treat the appeal as having been preferred on the date on which proof of payment was furnished and then to see whether under the proviso to section 14(1) there was sufficient cause or not to excuse the delay in preferring the appeal. They therefore, directed the assessee in that case to move a petition for condonation of delay. 10.. The next important decision on which considerable reliance is placed by learned counsel for the respondent/assessee is Lakshmiratan Engineering Works Ltd. v. Assistant Commissioner (Judicial) I, Sales Tax [1968] 21 STC 154 (SC). That case arose under the U.P. Sales Tax Act. The necessary facts which are relevant for our purpose are as follows: The or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s heard and disposed of?" After considering several judgments, the Supreme Court observed: "......For purposes of limitation and for purposes of the rules of the court it is required that a written memorandum of appeal shall be filed. When the proviso speaks of the entertainment of the appeal, it means that the appeal such as was filed will not be admitted to consideration unless there is satisfactory proof available of the making of the deposit of admitted tax." What is more, the Supreme Court proceeded to say that rule 66 framed under the U.P. Act prescribing the mode of preferring an appeal, referring to the challan showing deposit in the treasury, of the tax admitted by the appellant as directory in nature. Observed the Supreme Court that the other modes of proof are not necessarily shut out. 11.. Learned counsel for the respondent laid emphasis on the following words in the said judgment: ".......We are of opinion that by the word 'entertain' here is meant the first occasion on which the court takes up the matter for consideration. It may be at the admission stage or if by the rules of that Tribunal the appeals are automatically admitted, it will be the time of hearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tition to condone the delay under section 5 of the Indian Limitation Act. Here again, there was no outer limit regarding the period of limitation within which an excuse delay petition could be filed. Overruling the decision of the Allahabad High Court which purported to follow a decision in Lakshmiratan Engineering Works Ltd. v. Assistant Commissioner [1968] 21 STC 154 (SC) the Supreme Court observed: ".......In other words, the appeal will be deemed to have been properly filed on the date on which the amount of admitted tax is paid. If that is beyond the period of 30 days the appeal will be barred by time. Section 9(6) will immediately become applicable to that appeal and it will be open to the appellant to apply for condonation of delay under that provision." Again the Supreme Court observed: ".....The correct approach is to treat the appeal as having been preferred on the date on which proof of payment of the tax was furnished and then to see whether under sub-section (6) of section 9 there was sufficient cause for excusing the delay in preferring the appeal. The decision of the Kerala High Court in Gangadharan Pillai v. Sales Tax Officer (Reserve), Ernakulam [1965] 16 S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derstand the provisions of section 31 of the Act. To put it in a nutshell it says,- (1) that an appeal can be filed within a period of 30 days from the date on which the order of the assessing authority was served on him. (2) that an appeal can be presented after the expiration of 30 days within a further period of 15 days if the appellant had sufficient reason to explain the delay. (3) the second proviso to section 31 places an embargo on the appeal being entertained unless it is accompanied by satisfactory proof of the payment of the tax admitted by the appellant. Similar provisions occurring in the enactments of the other States have been interpreted by the apex Court in the above two judgments, by pointing out that, what is necessary is to see that the admitted tax is paid within the time prescribed. In other words, the proof of having paid such tax, even if it is produced when the appeal is taken up for the first time for consideration, it would be sufficient to hear the appeal. Therefore what is necessary is that the payment of admitted tax must have taken place within the time allowed by law for preferring the appeal or within the further period of 15 days or 30 days a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Supreme Court are directly on point. In such a situation, even the consideration of a decision of any High Court even if it has considered the similar provisions does not arise, as such decisions cannot prevail over the decision of the Supreme Court on the point as under article 141 of the Constitution of India, the law declared by the Supreme Court shall be binding on all the courts within the territory of India. 16.. Reference is then made to a decision in Babulal Mohanlal Kandele v. Commissioner of Sales Tax [1981] 47 STC 164 (MP). In that case the Madhya Pradesh High Court was concerned with the provisions of sub-sections (3) and (4) of section 38 of the Madhya Pradesh General Sales Tax Act and rule 58 of the Rules framed thereunder, which are totally different from section 31(1) of the Act. Therefore, the decision has no application to the cases on hand. To understand the difference, we quote those provisions. The relevant statutory provision is contained in sub-sections (3) and (4) of section 38, which read as follows: "(3) No first or second appeal against an order of assessment, with or without penalty, shall be admitted by the appellate authority unless the tax w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the decision of the Madhya Pradesh High Court. 17.. The judgment in Sadhana Enterprises v. Commissioner of Sales Tax [1987] 64 STC 172 (MP) was also based on the above provisions of the Madhya Pradesh Act and do not in any way help the respondents because the provisions are entirely different from the Tamil Nadu Act, viz., section 31(1). 18.. Considerable reliance is placed by Mr. K.J. Chandran, learned counsel for the respondents, on Shyam Kishore v. Municipal Corporation of Delhi (1993) 1 SCC 22. The apex Court surveyed the entire provisions of the Delhi Municipal Corporation Act, 1957, before coming to sections 169 and 170 of the said Act relating to filing of appeals. Section 169(1) reads as follows: "169. Appeal against assessment, etc.(1) An appeal against the levy of assessment of any tax under this Act shall lie to the court of the District Judge of Delhi. (2) to (6)............" Section 170 reads as follows: "170. Conditions of right to appeal.No appeal shall be heard or determined under section 169 unless- (a) the appeal is, in the case of a property tax, brought within thirty days next after the date of authentication of the assessment list under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him. We, however, hold that he has the power to adjourn the hearing of the appeal or pass interim orders enabling the assessee to pay up the taxes before the appeal is actually heard and determined." 20.. It will thus be clear that the said judgment turned on the words "heard or determined" and will not apply to the words "entertained" used in section 31(1) of the Act. In any event, the abovementioned ratio does not advance the case of the respondents. 21.. Being unable to get out of the ratio of the judgments of the Supreme Court in [1968] 21 STC 154 (Lakshmiratan Engineering Works Ltd. v. Assistant Commissioner) and [1972] 29 STC 201 (Lalta Prasad Khinni Lal v. Assistant Commissioner) (cited supra), Mr. Chandran advanced an argument that the statute gives the right of appeal and an interpretation cannot be placed on the second proviso to section 31(1) of the Act so as to defeat or deny the appeal itself. One has to see only the judgment of the Supreme Court in Shyam Kishore v. Municipal Corporation of Delhi (1993) 1 SCC 22 cited by the respondents themselves, to reject this contention. The right of appeal is a creature of statute and it is governed by the conditions attached ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ake away the rigour of the second proviso to section 31(1) of the Act. We are, therefore, firmly of the opinion that if there is no payment of the admitted tax within the period allowed for filing the appeal or within the extended period as specified in the Act for condonation of delay in preferring an appeal, no appeal can be said to have been filed. It is only when the payment of admitted tax is made that the appeal can be said to have been filed. We also make it clear that the words "no appeal shall be entertained under this sub-section unless it is accompanied by satisfactory proof of the payment of the tax admitted by the appellant to be due or of such instalments thereof as might have become payable, as the case may be", as already stated by us in para 14 supra, are interpreted to mean that the payment of the admitted tax should be made within the time or the extended time prescribed, for filing an appeal even though the satisfactory proof may be produced later before the appeal is taken up for the first time for consideration. Consequently, it follows that if the payment of admitted tax is made beyond the period of 30 days prescribed for the filing of an appeal and beyond th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 12,638. Correcting the mistake the assessing authority passed a revised order only on June 7, 1988. The assessee paid the said amount of Rs. 12,638 in two instalments, a sum of Rs. 9,520 on May 16, 1988 and the balance of Rs. 3,118 on June 8, 1988. The Appellate Assistant Commissioner had held that these payments were made with a delay of 25 days and 48 days respectively and therefore, could not have been condoned under the first proviso to section 31(1) of the Act, being more than 15 days. In our opinion, this approach is totally incorrect because in respect of the assessment order dated February 29, 1988, the appeal had been filed in time along with the admitted tax on April 20, 1988. Since there was a mistake in the order of assessment and consequently some more amounts had to be paid, a revised order was passed on June 7, 1988. Calculated from June 7, 1988 the payments on May 16, 1988 and June 8, 1988 were perfectly within the time even as per section 31(1) of the Act. It cannot therefore, be said that the admitted tax had been paid after a delay of 25 days or 48 days as assumed by the Appellate Assistant Commissioner. Though the Tribunal had remanded the matters on an incor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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