1964 (11) TMI 87 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to the vires of regulation 8(2) of the Appellate Tribunal Regulations, 1957 under Article 226 of the Constitution. Interpretation of whether regulation 8(2) is ultra vires of section 22(4) of the Mysore Sales Tax Act, 1957.

Detailed Analysis:
The petitioner filed a writ petition challenging the order of the Mysore Sales Tax Appellate Tribunal dismissing the appeal for default of appearance. The primary issue was whether regulation 8(2) empowering dismissal of appeals for default is ultra vires of section 22(4) of the Act. Section 22(4) mandates the Tribunal to pass orders on the appeal after giving both parties a reasonable opportunity to be heard. The Tribunal's power to dismiss appeals for default is not provided for in the Act, raising questions on the validity of regulations 8(2) and 9(1).

The Court examined the meaning of "pass such orders thereon as it thinks fit" in section 22(4), emphasizing that the Tribunal must decide on the subject matter of the appeal. Referring to judicial precedents, the Court held that an order of dismissal for default is not an order passed on the subject matter of the appeal but is outside its scope. The Tribunal's duty is to consider the grounds of appeal and decide on merits, irrespective of the appellant's presence.

The Court found support for its decision in a Full Bench judgment of the Madras High Court and a decision of the Patna High Court, both invalidating rules similar to regulation 8(2). It highlighted the statutory right of an assessee to appeal to the High Court under section 23, which would be jeopardized if appeals are dismissed for default. The Court concluded that regulation 8(2) is ultra vires of the Act as it contradicts the legislative mandate for the Tribunal to decide appeals on merits regardless of appearance.

In the final judgment, the Court allowed the writ petition, quashed the Tribunal's order of dismissal for default, and directed the Tribunal to take up the appeal and dispose of it in accordance with the law. The Court's decision was based on the interpretation of the Act's provisions and the principle that dismissal for default undermines the statutory rights of the parties involved in the appeal process.