SARWAN SINGH Vs. STATE OF ORISSA

JUDGEMENT

(1.) THIS is an application under Articles 226 and 227 of the Constitution for the issue of a writ of mandamus directing the opposite party No. 1, the State of orissa, represented by the Commissioner of Sales-tax; Orissa, not to require the opposite party No. 2, Chief Engineer, Hirakud Dam Project, to make any payment towards the sales tax and to refund the amount under attachment.

(2.) THE petitioner is a contractor under the Hirakud Dam Project for carrying on business of certain earth work and carriage work during the period 1951-55. Petitioner was assessed to sales- tax for the quarters ending with 31st March, 1952 to 31st March, 1954. He, however, did not receive either the several orders of assessment or the notices of demand as required under the provisions of the orissa Sales-tax Act, and the rules there under. He subsequently came to know that as a consequence of these assessments he was assessed to a total tax of Rs. 19,326. 44np, Eventually he came to know of this assessment when coercive processes were taken for realisation of the tax from him. Out of the dues of the petitioner from the Hirakud Dam Project, on account of the work done by him a sum of Rs. 21,818-18 np. had been recovered under instructions of the sales-tax officer and Rs. 3,786-93 np. were adjusted towards the sales-tax alleged to be payable by the petitioner for the quarters ending march, 1952, September, 1952, January 1953 and December 1953. Out of the aforesaid amount a sum of Rs. 16,433. 63 np. was still held by the Chief Engineer hirakud Dam Project as is evident from his letter No. FA/gl- 67-76/1436 dated may 11, 1959 (Annexure B ). From another letter issued by the Administrative officer, Hirakud Dam Project (Annexure B/1) another sum of Rs. 2491. 75 np. was appropriated as sales-tax for the quarter ending December 1950 to December 1951. Thus, according to the above letter bearing No. A. 1. 31/6/301-02 dated january 24, 1959, the, total sum held by the Chief Engineer was found to be Rs. 13,941. 88 np. representing tax on earth work end carriage for which no sales- tax is payable. Accordingly, the petitioner wrote to the financial adviser and Chief Accounts officer, Hirakud Dam Project on 13-10-1958 to release the afore said sum, since the recovery made from his bill on account of sales-tax dues was illegal and his case was covered by the decision of the Supreme Court in the case of State of madras v. Cannon Dunkerley and Co. (Madras) Ltd. , AIR 1958 SC 560. The sales-tax officer following the aforementioned decision of the Supreme Court issued a circular letter dated July 24, 1958, a copy of which was sent to the petitioner stating that he was not liable for such contracts as were covered by the decision of the Supreme Court (Vide earth work and carriage work done by him for the hirakud Dam Project He further admitted the sum of Rs. 3786. 93 np. and Rs. 2491. 75 np. were adjusted towards the tax dues. The final balance of Rs. 13,941. 88 np. was available to the petitioner which represented the tax on earth work and carriage for which no sales- tax is payable.

(3.) IT was contended on behalf of the petitioner that in view of the Supreme. Court decision in the well-known Gannon Dunkerley's case, the tax of earth work and carriage work is not legally leviable and hence the amount is mentioned in the letter of Administrative Officer for the Chief Engineer Hirakud Dam Project dated january 1959 should now be available for refund to the petitioner. Mr. Misra on behalf of the petitioner, however did not claim the refund in respect of Rs. 378693 np. which was adjusted towards the sales-tax for the quarters ending March, 1952 to December 1953. He based his whole claim on the final letter of the Administrative Officer and accordingly claimed a sum of Rs. 13941. 88 np. His argument thus was that the expression 'sale of goods' has been given the precise meaning by the Supreme Court in the above-mentioned case according to which 'sales of goods' is a nomen juris, its essential ingredients being an agreement to sell movables for a price and property passing therein pursuant to that agreement.