THE SECRETARY Vs. LUCKY BIDI COMPANY

JUDGEMENT

(1.) IN this second appeal the Defendant State of Orissa is the Appellant from a reversing decision of the learned District Judge, Sambalpur, whereby he reversed a decision of the learned Subordinate Judge, Sambalpur, and decreed the suit in favour of the Plaintiff Lucky Bidi Company. The suit was filed by the Plaintiff Lucky Bidi Company against the Secretary, State of Orissa (in charge of Commercial Taxes) for a declaration that the assessment orders and notices of demand for payment of taxes levied on one Gohil Bidi Company for the quarters ending December 31st, 1948 and March 31, 1949 are without jurisdiction and not binding on the Plaintiff Lucky Bidi Company and further that certain proceedings pending in the Court of the Additional Tahsildar, Sambalpur, is without jurisdiction and not binding on the Plaintiff Lucky Bidi Company and for a permanent injunction restraining the Defendant State of Orissa from enforcing the said orders and demand notices against the Plaintiff Lucky Bidi Company.

(2.) THE relevant facts, shortly stated, are these: Admittedly the said Gohil Bidi Company was a joint family concern consisting of Khodabhai and Walamji Khodabhai, as also three other sons who are minors. On January 16, 1950 a partition is alleged to have taken place in the family under which the two major sons Dayaram and Walamji became separate from their father and the three other brothers who were minors; the said partition is stated to have been registered on the said January 16, 1950 (Ext. 9). Thereafter within two months time on March 25, 1930 the said Lucky Bidi Company appears to have come into existence as a partnership firm under a registered partnership deed (Ext. 10), in which the said two brothers Dayaram and Walamji and two other strangers appear to have become partners. The case of the Plaintiff Lucky Bidi Company is that they constituted a separate legal entity as partnership and had nothing to do with Gohil Bidi Company; accordingly Lucky Bidi Company was not bound by the assessment proceedings in connection with the assessment of Gohil Bidi Company with which Lucky Bidi Company is alleged to have no concern as aforesaid.

(3.) THE trial court on evidence found that the partition deed (Ext. 9) could not be accepted and as regards the identity of the two concerns Gohil Bidi Company and Lucky Bidi Company, the learned trial Judge found that they were the same and the two strangers appearing to have taken into the partnership of Lucky Bidi Company had in fact nothing to do with the said partnership. On the points of law taken in defence as aforesaid the learned trial court found that the suit was not maintainable under Section 22 of the Orissa Sales Tax Act; the learned Judge however did not consider the applicability of Sections 114 and 152 of the Central Provinces Land Revenue Act. On these findings both as to merits and the points of law as aforesaid the learned trial Judge dismissed the suit. In appeal, the learned lower appellate Court while not reversing the findings of the learned trial Court dismissed the suit on grounds stated in his judgment. While dealing with the findings of the trial Judge, he commented that the demand notices against the Lucky Bidi Company and the subsequent certificate proceedings have all been initiated on the assumption that the Lucky Bidi Company ' is not a fictitious legal entity and the learned lower appellate Court observed that the finding of the learned trial judge that the Lucky Bidi Company is a fictitious company and at the same time the same is liable for the arrear sales tax against Gohil Bidi Company is an inconsistent and untenable finding. On the points of law the learned lower appellate Court found that the provisions of Sections 114 and 152 were not applicable if assessment was without jurisdiction; as regards the bar of civil suit under Section 22 of the Orissa Sales Tax Act, the learned lower appellate Court found that this case did not come within the ambit of the said section. On these findings both on fact and in law the learned lower appellate Court decreed the Plaintiff 's suit as aforesaid. Hence this second appeal.