R S MANIAR Vs. STATE OF BOMBAY

JUDGEMENT

(1.) THIS is an application by the Collector of Sales Tax, Bombay, for reference to the High Court of certain questions said to arise out of our decision in Revision Application No. 136 of 1956 dated the 15th July, 1957. The facts in this case are as follows :-

(2.) THE opponents had business at two places viz., Pankor Naka, Ahmedabad and Dholka. THE opponents applied in August, 1946, for the registration of both these places of business. THE turnover of the Ahmedabad shop was Rs. 46,000 for the year 1944-45 and the application for registration was granted for the business at the said shop. As regards the Dholka business, of which the turnover was Rs. 14,095 for the year 1944-45, no registration certificate was granted. In the application to be given for a registration certificate at that time it had to be merely stated that the opponents had additional places of business and the addresses where other business was carried on had also to be given; but there was no requirements as to the giving of the total of the turnovers at different places; such requirement was inserted later in Form No. 11 in which such applications were to be made. In December, 1949, the Sales Tax Officer of Ahmedabad District began enquiries regarding the registration and liability of the opponents' shop at Dholka. He issued notices on 3rd March, 1950, 22nd March, 1950, 10th July, 1950, 4th August, 1950, and 14th February, 1951, requiring the opponents to produce their books of account of the Dholka shop. THE opponents appear to have consistently remained absent and asked for adjournments. On 24th March, 1951, they were told to make a regular application for registration for the Dholka shop. THEy made such application on 20th October, 1952, and were granted a registration certificate on the same date for the said shop with liability to pay sales tax from 1st October, 1946. Mr. R. V. Patel for the opponents contended that as the opponents were refused a registration certificate for the Dholka shop, they had been misled into thinking that no registration was required for the shop, that accordingly, the sales tax had to be paid on all the purchases made by the said shop, and that the decision of Sales Tax Officer refusing a registration certificate to the Dholka shop should be held to establish a case of estoppel against the department so that the latter should not, in the circumstances, be permitted, so far as the transactions which were thus affected by the said order or decision were concerned, to deny the truth of the decision of the Sales Tax Officer and to act differently. That is to say, the department having themselves caused the applicants to pay the sales tax on their purchases for the Dholka shop should not be allowed to turn round and act on the understanding that the sales of the said shop were subject to the sales tax. That principle was laid down by this Tribunal in paragraph 4 of the judgment in Messrs THE Bombay Film Laboratories Ltd. v. THE State of Bombay ((1954)) 3 S.T.D. 73). We saw no reason to hold a different view in this case when it was clear that the opponents, so far as purchases of the Dholka shop were concerned, were bound to pay the sales tax and that the decision of the Sales Tax Officer directly produced this result. It was, however, also clear that the opponents should have appeared before the Sales Tax Officer, Ahmedabad, in the subsequent proceedings when that officer issued notices from 3rd March, 1950. In response to the first notice the applicants replied that none of the sales of the shop were taxable and requested that the notice be cancelled. In the second notice dated 22nd March, 1950, however, the opponents were requested to attend personally on the 1st April, 1950, but this notice was not complied with, the opponents merely asking for a long adjournment. We thought that the opponents could not be held entitled to the benefit of the long period which had elapsed between the commencement of the second proceedings and the date on which the Dholka shop had been given a registration certificate. For this delay we held the opponents themselves partly responsible, as when they were required to be present by the Sales Tax Officer, it was their duty to attend, and on attendance they might have been informed that a separate application for registration would be necessary. We thought, in the circumstances of this case, that it would be proper to hold the opponents liable from 22nd March, 1950, to assessment, and that the registration certificate should be effective from the date. We, therefore, allowed the application and varied the orders of the authorities below accordingly.