STATE OF MADRAS Vs. MADURAI MILLS CO LTD

JUDGEMENT

(1.) THIS is a petition by the State of Madras, for leave to appeal to the Supreme court of India from the judgment of this Court in T. C. No. 162 of 1958. Leave is asked for under Article 133 of the Constitution of India. The respondent, the madura Mills Co. , Ltd. , opposed the application, and raised a preliminary objection that the application is not maintainable under Article 133 or Under Sections 109 and 110 C. P. C. as the proceedings which terminated in this Court in the order sought to be appealed from are not civil proceedings. This is the main question which has been argued before us, and if we were to uphold the objection of the respondent, the application will have to be rejected in limine, without going into the question whether the case is a fit one for a necessary certificate under Article 133.

(2.) WE shall now briefly set out the facts which gave rise to T. C. 162 of 1958 disposed of by us on 13-9-1961. The Madura Mills Co. Ltd. , the respondent, is a limited company dealing in yarn. In December 1950-51 it returned a total turnover of Rs. 15,27,833-8-4 under the Madras General Sales Tax Act 1939 before the deputy Commercial tax Officer, Madurai. The officer determined the net turnover at Rs. 15,44,09,109-3-11. The assesse preferred an appeal from that assessment before the Commercial Tax Officer, Madurai South. It raised a contention that a sum of Rs. 1,44,294-14-4 was wrongly included by the assessing authority in the purchase value of cotton. as that amount represented the commission paid by it to commorin Investment Trading Co, another limited company. It further contended that another sum of Rs. 81,546-0-1, representing the sale proceeds realised by selling the empty drums and other miscellaneous "articles was not include able in the business turnover. The Commercial Tax Officer upheld the contention in relation to a sum of Rs. 1, 44,294-14-4 and excluded it from the total turnover, but negatived the other contention in regard to the sum of Rs. 81,546-0-1. The respondent then preferred a revision petition before the Deputy Commissioner of commercial Taxes, and raised an objection that it should not have been assessed to tax on amounts collected by it by way of tax amounting to Rs. 6,57,974-4-9. No objection was raised by the respondent in regard to any other matter dealt with by the Commercial Tax Officer. By an order, dated. 31-8-19. 54, the Deputy commissioner dismissed the revision petition. The Board of Revenue Madras issued notice to the respondent on 4-8-1958 pro. posing to revise the assessment of the Deputy Commercial Tax Officer on the ground that a sum of Rs. 7,74,62,706-1-6 was wrongly excluded by the assessing authority. This was objected by the respondent and one of the grounds of objection was that the proceedings initiated by the Board of Revenue were barred by limitation. The board overruled the objections of the assessee, and by its order dated 25-8-1958 fixed a net turnover of the respondent at Rs. 23,17,948-18. From this decision the respondent preferred an appeal Under Section 12 (c) of the Madras General Sales tax Act to this Court in T. C. No. 162 of 1958. We allowed the appeal and set aside the order of the Board mainly on the ground that the proceedings of the Board were beyond the period of limitation prescribed by the statute. It is this decision which is now the subject-matter of the contemplated appeal by the State to the supreme Court of India.

(3.) THE Madras General Sales Tax Act 1939 does not contain any special provision to enable the State or the aggrieved subject to prefer an appeal to the Supreme court of India from a decision of this court arising out of the proceedings under the Act. The Act is a self-contained. exhaustive code, governing assessment and levy of sales tax. A heirarchy of authorities has been constituted under the Act to enable the aggrieved party to canvass the correctness or validity of the assessment proceedings. First there is the assessing authority which makes the assessment on the submission of the return made by the assessee. A. right of appeal is granted to the asssesee from the order of the assessing authority Under section 11 of the: Act. It is open to the appellate authority to pass such orders as it thinks fit. Section 11 Sub-section (4) provides that every order passed in appeal shall, subject to the provisions of Sections 12 to 12-C, be final. Section 12 (1)prescribes that the Commercial Tax Officer may suo motu or in cases in which an appeal does not He to him, on application, call for and examine the record of any order passed or proceeding recorded under the provisions of the Act by any officer subordinate to him for the purpose of satisfying himself as to the legality or propriety of such order, or as to the regularity of such proceedings and may pass such order with respect thereto as he thinks fit. Similar powers of revision have been given to the Deputy Commissioner and to the board of. Revenue Under Section 12 Sub-section (2) and Section 12 Sub-section (3) respectively. Section 12-A provides a remedy byway of further appeal by the assessee to the Appellate Tribunal objecting to an order of assessment. The tribunal has power to entertain an appeal from an order of the Commercial tax officer, made Under Section 11 or Section 12 (I) or from that of Deputy commissioner acting suo motu Under Section 12, Sub-section (2 ). Sub-section (9)of Section 12-A enacts that every order passed by the Appellate Tribunal shall, subject to the provisions of Sub-section (6) and Section 12-B, be final. Sub-section (6) enables the Appellate Tribunal, on an application of the assesse or the Deputy commissioner, to review any order passed by it under Sub-section (4 ). Section 12-B gives the power of' revision to the High Court. The High Court, on perusing the revision petition and after giving both-parties to the petition a reasonable opportunity of being heard, determine the question of law raised and either reverses, affirms or amends the order against which the petition was preferred or remits the matter to the Appellate Tribunal with its opinion on the question of law raised or passes such order in relation to the matter as it thinks fit. Under Section 12-C, appellate power is granted to the High Court against the orders passed by the Board of Revenue, suo motu Under Section 12 Sub-section (3 ). Any assessee objecting to an order of the Board" passed suo motu may file an appeal within the time prescribed and in the prescribed form accompanied by a fee of Rs. 100. The High Court shall, after giving both the parties to the appeal a reasonable opportunity of being heard, pass such-order thereon as it thinks fit. Section 12-D provides that every petition, application or appeal preferred to the high Court Under Section 12-B and Section 12-C shall be heard by a Bench of not less than two Judges and in respect of such petition, application or appeal, the provisions of Section 98 C. P. Code, 1908. shall so far as may be_ apply. The remedy of an aggrieved assessee or the State, as the case may be, to have an illegal or erroneous order of assessment cancelled or set aside lies only within the four corners of this special enactment and in fact Sections 9 to 12-D are the facicule of sections which provides the necessary machinery. It is obvious that an order of assessment however erroneous or wrongful it may be, cannot be called in question in a civil court. By way of abundant caution, however, the Legislature has introduced Section 18-A and that reads: