DEVINDER PAUL Vs. STATE OF PUNJAB

JUDGEMENT

(1.) ORDER passed by the Excise and Taxation Officer, Rajpura, refusing to issue registration certificate to the petitioner under the Punjab General Sales Tax Act, 1948, is subject-matter of challenge in this writ petition.

(2.) IN order to decide whether the impugned order, annexure P2, suffers from any legal error, it will be necessary to take notice of some facts. Petitioner is proprietor of M/s. Sonika Steel Sales, Rajpura, and is engaged in the business of purchase and sale of iron and steel and its finished goods on commission basis. Petitioner applied for registration under the Punjab General Sales Tax Act, 1948 as well as the Central Sales Tax Act, 1956 and produced the required documents. His business premises were inspected on February 1, 1996 by the Excise and Taxation Officer, Rajpura. Thereafter, the petitioner submitted an affidavit as well as surety bond signed by two registered dealers of Rajpura Town. Thereafter, the respondent No. 2 seems to have made certain enquiries in respect of one of the transactions of purchase of goods made by the petitioner with M/s. Sumit Steel Corporation, Ajmer, and on the basis of such enquiries, the respondent No. 2 passed the impugned order and rejected the application filed by the petitioner for registration under the Punjab General Sales Tax Act, 1948. Case of the petitioner is that the respondent No. 2 did not give any notice or opportunity of hearing to him to explain the adverse circumstances and passed the impugned order on the basis of information collected behind the back of the petitioner and, therefore, the impugned order should be quashed on the ground of violation of principles of natural justice. The petitioner has also set out detailed facts to explain as to how the transaction of purchase of steel from M/s. Sumit Steel Corporation, Ajmer, is bona fide and there is no attempt by the petitioner to flout the provisions of law.

(3.) WE have heard Shri K. L. Goyal, learned counsel for the petitioner and Shri G. S. Cheema, learned Assistant Advocate-General. In our opinion, the impugned order is liable to be quashed on account of violation of basic principles of natural justice. Perusal of the order, annexure P2, shows that the respondent No. 2 entertained certain doubts about the genuineness of the bill issued by M/s. Sumit Steel Corporation, Ajmer, and the respondent No. 2 made certain secretive enquiries from M/s. Sumit Steel Corporation and the authorities of the Sales Tax Department of the Government of Rajasthan. The respondent No. 2 felt that the bill of M/s. Sumit Steel Corporation was not above suspicion and if the petitioner was given a licence, there was every possibility of its being misused. However, it is an admitted position that before passing impugned order on the basis of the material collected by the respondent No. 2 behind the back of the petitioner, no notice or opportunity of hearing was given to the petitioner to explain the adverse circumstances. It must, therefore, be held that the petitioner has been condemned unheard.