1951 (9) TMI 31 - HC - VAT and Sales Tax

Issues Involved:
1. Whether an application for revision can lie in the first instance.
2. Whether it was necessary that the amount of tax with penalty should have been paid before filing the application.
3. Whether the Deputy Commissioner was correct in transferring the application for disposal to the Assistant Commissioner.
4. Legitimacy of the penalty levied by the Sales Tax Officer under Section 12(3A) of the Act.

Issue-wise Detailed Analysis:

1. Whether an application for revision can lie in the first instance:
The judgment clarifies that revisions are governed by Section 22 of the Bombay Sales Tax Act. The relevant portion of this section states: "Subject to such rules as may be prescribed and for reasons to be recorded in writing the Commissioner (now Collector) may upon application...revise any order passed under this Act or the Rules thereunder, by a person appointed under Section 3 to assist him provided that no application under this sub-section shall be entertained, if it is not made within a period of four months from the date of the order." The court concluded that the provisions of Sections 21 and 22 provide two remedies, and a party having two remedies permissible to him can certainly choose the more convenient and less costly out of them.

2. Whether it was necessary that the amount of tax with penalty should have been paid before filing the application:
The court examined Rule No. 48 of the Bombay Sales Tax Rules, which states: "No application for revision of any order of assessment with or without penalty, passed in an appeal shall be entertained by any authority unless it is satisfied that the tax with penalty, if any, in respect of which the application is made has been paid." The court noted that this rule does not apply because the revision in question was not of an order passed in an appeal. The court further clarified that Form No. XXV, which is a form of application for all kinds of revisions, allows for striking out inapplicable portions, indicating that if the Act or the Rules do not make the payment of tax with penalty obligatory, the applicant can disregard and strike out para 5 of the form. The judgment emphasized that the intention of the Legislature, as gathered from the language used, did not intend to insist on prepayment of tax and penalty for revisions not arising from an appeal.

3. Whether the Deputy Commissioner was correct in transferring the application for disposal to the Assistant Commissioner:
The court referred to Notification No. 114 dated 22nd November, 1946, which delegated the power to entertain revisions to the Assistant Commissioners. However, the court noted that this delegation does not take away the power of the Commissioners or the Deputy Commissioner to entertain the applications. The power of these three officers to entertain revisions is concurrent, and parties could approach any of them for relief. The court expressed doubt about the Deputy Commissioner's authority to transfer the revision application to the Assistant Commissioner, suggesting that the Deputy Commissioner should hear the application himself and pass suitable orders.

4. Legitimacy of the penalty levied by the Sales Tax Officer under Section 12(3A) of the Act:
The court discussed the penalty levied on the applicant, noting that the applicant is a retail kariana dealer who had applied for registration in 1946 but was not granted the certificate at that time. The Sales Tax Officer's discovery of the applicant's turnover exceeding Rs. 30,000 was only at the end of the next year, 1947-48. The court referenced a Government order authorizing remission of up to 75% of the tax for pre-registration sales, emphasizing that the penalty should be levied in cases of willful failure to register. The court found no justification for the additional penalty under Section 12(3A) in this case.

Conclusion:
The application for revision is allowed. The papers of the case should be sent to the Collector of Sales Tax with a direction to hear the revision application on merits and pass suitable orders. No order as regards costs before this Tribunal.

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