CHANDI PRASAD CHOKHANI Vs. STATE OF BIHAR

JUDGEMENT

(1.) These three appeals with special leave granted under Art. 136 of the Constitution have been heard together and this judgment will govern them all. They raise a common question as to the practice of this Court, which we shall presently state. But before we do so, we must first set out the facts in so far as it is necessary to state them in order to appreciate the precise nature of the question that has arisen for consideration in these appeals.

(2.) The relevant facts are these. The firm of Messrs. Durga Dutt Chandi Prasad, appellant in these appeals, carried on a business of dealing in several kinds of goods but mostly in raw jute at Sahebganj in Bihar. It was registered as a dealer under S. 4 of the Bihar Sales Tax Act, 1944, with effect from July, 1, 1946, For three periods, commencing from October 1, 1947 and ending on March 31, 1950 it was assessed to sales tax on its turnover of the relevant periods, which consisted inter alia of purchases alleged to have been made on behalf of two other jute mills outside Bihar, namely, the Raigarh Jute Mills and the Bengal Jute Mills, and also of despatches of jute said to have been made to the dealer's own firm in Calcutta for sale in Calcutta. For the assessment period commencing on October 1, 1947 and ending, on March 31, 1948 the appellant claimed a deduction of (a) Rs. 6,58,880-5-9 on the ground that the said amount represented purchases made on behalf of the aforesaid two jute mills, and (b) Rs. 1,62,662-13-3 being despatches of jute made to the dealer's own firm in Calcutta. Similarly, for the next assessment period commencing on April 1, 1948 and ending on March 31, 1949 the appellant claimed a deduction of certain amounts (the exact amounts being irrelevant for our purpose) on the two grounds mentioned above from the relevant turnover. The claim of the appellant was that purchases made on behalf of the two jute mills aforesaid and the despatches of jute made to the appellant's own firm in Calcutta were not 'sales' within the meaning of the Bihar Sales Tax Act,1947 (hereinafter called the Act). For the third period of assessment commencing on April 1, 1949 and ending on March 31, 1950 a similar claim was made. But for this period there was an additional claim with regard to the sale of mustard see worth Rs. 1,00,513-11-9 to Messrs. Panna Lal Binjraj for which the appellant claimed a deduction.

(3.) On June 7, 1951 the Sales Tax Officer concerned disallowed the claim of the appellant for the first two periods and by an order dated April 17, 1953, the claim for the third period was also disallowed. The appellant then preferred appeals under the relevant provisions of the Act. These appeals were heard by the Deputy Commissioner of Commercial Taxes, Bihar, and were dismissed by him. Then the appellant filed applications in revision under S. 24 of the Act to the Board of Revenue, Bihar. The Board by its orders dated August 20, 1953 and September 3, 1953 dismissed the petitions of revision relating to the first two periods and by its orders dated April 30, 1954 also dismissed the petition of revision relating to the third period. Under S. 25(1) of the Act the appellant moved the Board to state a case to the High Court of Patna on certain questions of law which, according to the appellant, arose out of the orders passed. The Board, however, refused to state a case inasmuch as in its opinion no questions of law arose out of the orders passed. The Board expressed the view that the two questions, namely, (1) whether the despatch of jute outside the State of Bihar was a sale within the meaning of the Act and (2) whether the purchases said to have been made on behalf of the two mills outside Bihar were liable to tax, were both concluded by findings of fact arrived at by the competent authorities on relevant materials in the record and were no longer open to challenge. The appellant then moved the High Court for requiring the Board to state a case on the questions of law which, according to the appellant, arose out of t he orders passed with regard to the first two periods of assessment.