COMMISSIONER OF TAXES ASSAM Vs. BABUBHAI S PATEL

JUDGEMENT

(1.) This is an appeal by special leave from a judgment of the Assam and Nagaland High Court by which a petition filed by respondent No. 1 under Article 226 of the Constitution was allowed and a notice dated March 11, 1963, issued to him under Section 31(1) of the Assam Sales Tax Act, 1947 (Act 17 of 1947), hereinafter called the Act, was quashed.

(2.) The facts may be stated: Respondent No. 1 carried on business under the name and style of Indian Tea Co. in Dibrugarh. He was registered as a dealer in January, 1956. He continued his business up to June 17, 1961, and at his request the registration certificate was cancelled with effect from June 18, 1961. Respondent No. 1 was assessed to sales tax for various periods between 1956 and 1951. Owing to a decision of the Assam High Court in which it was held that Rule 80 of the Assam Sales Tax Rules, 1947, as amended was ultra vires, assessment was made on the basis that the price of goods purchased by respondent No. 1 for the purpose of resale in the State by giving a declaration under Rule 80 but subsequently sent outside the State of Assam was not to be included in the net turnover under Section 15(1)(b)(i)(a) of the Act. That judgment of the High Court was reversed by this Court and the aforesaid rule was held to be intra vires. The appellant took steps to revise the assessments after the decision of this Court. A notice was issued on March 11, 1963, to respondent No. 1 under Section 31(1) of the Act as amended in 1962 wherein he was asked to appear before the Commissioner for showing cause as to why the assessment orders for the periods in question made by the Superintendent of Taxes, Dibrugarh, should not be revised and the price of goods purchased by him free of tax for the purpose of resale in the State by giving a declaration under Rule 80 but subsequently sent outside the State should not be included in his net turnover. Thereupon respondent No. 1 filed a petition under articles 226 and 227 of the Constitution in the High Court asking for the quashing of the notice and any subsequent proceedings taken pursuant thereto. The High Court allowed the petition on the ground that the provisions of Section 31(1) as amended were not retrospective and the Commissioner could not exercise the powers under the said provisions so as to affect the final orders of assessment.

(3.) During the pendency of the appeal before this Court the Assam Legislature has, by Section 8 of the Assam Sales Tax (Amendment) Act (13 of 196G) given Section 31(1) of the Act as it stood or. April 12, 1966, retrospective effect from December 24, 1947. In view of this amendment the sole ground on which the High Court had allowed the petition under Article 226 no longer exists and counsel for respondent No. 1 has not been able to show how that judgment can be sustained owing to a clear declaration by the Legislature that Section 31(1) should be deemed and always to have been deemed to have formed part of the principal Act as if the principal Act had been enacted as was amended with effect from December 24, 1947.