THARUMAL AND BROTHERS Vs. STATE OF M.P.

JUDGEMENT

(1.) THIS is a petition under article 226 of the Constitution of India.

(2.) BRIEFLY stated the facts of the case are that the petitioner, a firm engaged in sale of bidi as sole selling agent in Madhya Pradesh, is assessed to entry tax for the years 1989 -90, 1990 -91, 1991 -92, 1992 -93, 1993 -94 (annexures P/1 to P/5). Aggrieved, it preferred appeals impugning these orders (annexures P/6 to P/10) before respondent No. 5 (Appellate Deputy Commissioner). Respondent No. 5 dismissed the appeals on December 6, 1994 (annexures P/6 A to P/10 A). Appellate orders were served on February 1, 1995. The apex Court decided in [1994] 95 STC 5 (Entry Tax Officer v. Chandanmal Champalal and Co.) that goods brought or sold in the local area, if exported outside the area, are immune from levy of entry tax. Respondent No. 4, (Sales Tax Officer) equipped with powers of Tehsildar for the purposes of recovery of dues, issued demand notices (annexures P/22 to P/25) under section 146, Madhya Pradesh Land Revenue Code and later notices dated January 30, 1995 (annexures P/26 to P/29) under section 22(6) of M.P. General Sales Tax Act, 1958 to deposit the dues in seven days. Petitioner questioned validity of these notices on the ground of prematurity (annexures P/30, P/31). Respondent No. 4 also ordered attachment of bank accounts of the petitioner with respondent Nos. 6 to 8 (annexures P/32 to P/34). Petitioner seeks quashment of orders of assessment, recovery notices and attachment of bank accounts. Respondents Nos. 1 to 5 oppose the prayer.

(3.) ARTICLE 265 of the Constitution of India mandates that "no tax shall be levied or collected except by authority of law". It is thus clear that "collection" too must be in conformity with law. Learned counsel for the petitioner placed reliance on the decisions reported in [1991] 81 STC 269 (MP); 1989 CUR TJ 155 (Mulay Brothers v. State of M.P.) and [1988] 68 STC 308 (MP); 1988 CUR TJ 603 (Keveyan & Co. v. G. S. Bagehal) and prayed for the direction to respondents to make fresh assessment after reasonable opportunity of hearing to the petitioner and for cancellation of notices and for release of the bank accounts. The Government Advocate, on the other hand, submitted that the petition is without valid cause and remedy if any lies under the relevant Act. He also submits that benefit of period prescribed under the rule 37 is not available to the petitioner because the appellate authority neither made interference nor quantified any amount. According to him, it was simply a case of dismissal of the appeals.