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1989 (11) TMI 323
Issues Involved:
The petition under Section 482, Cr. P.C. challenges the order of taking cognizance under Section 436, IPC against the petitioners. The main contentions include the exclusive trial jurisdiction of the Court of Sessions, examination of witnesses under Section 202 Cr. P.C., and the timeliness of filing the application under Section 482, Cr. P.C.
Examination of Witnesses under Section 202 Cr. P.C.:
The lower Court, after an enquiry under Section 202 Cr. P.C., found a prima facie case under Section 436, IPC based on the statements of witnesses produced by the complainant. The proviso to Sub-section (2) of Section 202 Cr. P.C. mandates the Magistrate to call upon the complainant to produce all witnesses and examine them on oath if the offence is exclusively triable by the Court of Sessions. The Orissa High Court, following established principles, holds that the Magistrate is not required to examine all witnesses named in the complaint petition, but only those produced by the complainant and examined on oath.
Judicial Opinion and Precedents:
There is a conflict of judicial opinion regarding the proviso to Sub-section (2) of Section 202, Cr. P.C. Majority view, including that of the Orissa High Court, interprets the proviso as obligating the Magistrate to examine witnesses produced by the complainant. Precedents from other High Courts support the notion that failure to produce all witnesses does not vitiate the Magistrate's order of taking cognizance.
Timeliness of Filing Application under Section 482, Cr. P.C.:
The application challenging the impugned order was filed after about one year and six months, leading to the argument that the accused persons delayed the challenge and disrupted the case's progress. While there is no limitation for filing under Section 482, Cr. P.C., the Court emphasizes the importance of filing within a reasonable time to avoid hindering case advancement. A period of 90 days, akin to a revision petition, is deemed reasonable, and any delay beyond this requires justification.
Conclusion:
Considering the circumstances, the Court finds no merit in the Criminal Misc. case and dismisses the same, highlighting the importance of timely legal actions to maintain the smooth progression of cases.
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1989 (11) TMI 322
Issues:
1. Whether the assessment to gift-tax in respect of surrender of goodwill upon retirement of a partner is valid.
2. Whether the retirement and induction of a new partner in a firm involve an element of gift for tax purposes.
3. Whether the consideration received by the retiring partner and the incoming partner is adequate to negate the element of gift.
4. Whether the distribution of assets upon dissolution or reconstitution of a firm amounts to a taxable gift.
Detailed Analysis:
1. The judgment pertains to an appeal against the assessment to gift-tax following the retirement of a partner from a firm and the induction of a new partner. The Gift-tax Officer (G.T.O.) claimed that there was a surrender of goodwill upon the retirement, resulting in a taxable gift. The Appellate Assistant Commissioner upheld the assessment, relying on precedent. The appellant contested the assessment, arguing that the retirement and induction were normal business transactions without any gift element. The G.T.O. valued the taxable gift based on average profits, leading to the appeal before the tribunal.
2. The appellant's counsel contended that the firm had no goodwill and the incoming partner brought in sufficient capital as consideration for the transfer of interest. It was argued that the retirement and induction were bona fide transactions, not attracting gift-tax provisions unless specific sections were invoked. The counsel highlighted the absence of gift element, supported by legal precedents and circulars. The Departmental Representative countered, citing rulings emphasizing unequal distribution upon dissolution as constituting a gift. The tribunal considered these arguments, analyzing the nature of the transaction and the adequacy of consideration received by both partners.
3. The tribunal examined the legal principles governing partnerships and gifts in the context of retirement and reconstitution of a firm. It referenced various High Court judgments, including those from Kerala, Karnataka, and Andhra Pradesh, to determine the tax implications of such transactions. The tribunal noted that the retirement and induction should be viewed as an integrated transaction, with consideration given to the capital brought in by the incoming partner and the rights readjustment among partners. The tribunal found that the assessment to gift-tax was unwarranted based on the facts and circumstances of the case, ultimately annulling the assessment and allowing the appeal.
4. In conclusion, the tribunal ruled in favor of the appellant, holding that the assessment to gift-tax was not justified in the given scenario. The tribunal emphasized the importance of adequate consideration, the absence of a gift element in routine partnership adjustments, and the legal precedents supporting the appellant's position. The tribunal's decision annulled the assessment and allowed the appeal, providing clarity on the tax treatment of partnership changes involving retirement and induction of partners.
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1989 (11) TMI 321
Issues:
1. Suit withdrawal with liberty to file a fresh suit based on equitable mortgage.
2. Compliance with S. 69(2) of Partnership Act for maintaining the validity of a suit filed by an unregistered firm.
Analysis:
1. The petitioner, the defendant in a suit based on equitable mortgage, sought permission to withdraw the suit with liberty to file a fresh suit due to a formal defect regarding the registration of a partner. The plaintiff, a firm represented by a partner whose name was not registered at the time of filing the suit, requested withdrawal under O. 23, R. 1(3) and S. 151, Civil P.C. The defendant opposed, arguing that the suit was non est in the eye of the law due to non-compliance with S. 69(2) of the Partnership Act.
2. The key issue was whether non-compliance with S. 69(2) of the Partnership Act constitutes a formal defect or renders a suit void. The defendant relied on legal precedents emphasizing the mandatory nature of S. 69, stating that an unregistered partnership firm cannot maintain a suit. Previous judgments highlighted the necessity of registration and partner inclusion at the time of filing, not after, to maintain the suit's validity.
3. The court considered conflicting interpretations regarding the nature of the defect in the partnership registration process. While one party argued for a formal defect approach under O. 23, R. 1(3)(b), Civil P.C., the opposing party stressed the mandatory requirement of S. 69(2) of the Partnership Act. Legal precedents supported the view that non-compliance with mandatory provisions renders a suit void, as seen in various Division Bench decisions.
4. The court analyzed past judgments that distinguished between formal defects and mandatory requirements in legal proceedings. The distinction between technical defects, such as failure to issue statutory notices, and mandatory provisions like S. 69(2) of the Partnership Act was crucial in determining the validity of the suit. The court emphasized the need for strict compliance with mandatory provisions to maintain the integrity of legal actions.
5. Ultimately, the court allowed the revision petition, directing the lower court to restore the suit and proceed based on other legal and factual contentions. The decision highlighted the importance of adhering to mandatory legal requirements, especially in matters concerning partnership registration and the validity of suits filed by unregistered firms.
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1989 (11) TMI 320
Issues: Jurisdiction of the Court, Validity of Decree, Admissibility of Affidavits
Jurisdiction of the Court:
The revision petition challenges an order passed by the Addl. Munsiff No. 1, Jaipur City, in Execution Petition No. 43/81. The petitioner argues that the decree is null and void as it was passed by a court lacking territorial jurisdiction. Citing legal precedents like Kiran Singh v. Chaman Paswan and Hira Lal v. Kalinath, the petitioner contends that a decree from a court without jurisdiction is invalid. However, the court notes that the case was transferred by the District Judge from a court lacking jurisdiction to a competent court, rendering the objection on territorial jurisdiction baseless.
Validity of Decree:
The petitioner further argues that there is insufficient evidence to support the ex parte decree. Referring to Order 18, C.P.C., the court highlights the necessity for the plaintiff to produce evidence even in ex parte cases. The court emphasizes the importance of recording evidence under Order 18 and explains the requirements for proving a fact under Section 3 of the Evidence Act. Additionally, the court clarifies that affidavits can only be considered as evidence if permitted by the court under Order 19 Rule 1, as affirmed in the case of Smt. Sudha Devi V. M. P. Narayanan. Since the decree was primarily based on affidavits without proper authorization, it could be deemed a nullity.
Admissibility of Affidavits:
The court addresses the issue of admissibility of affidavits as evidence, emphasizing that affidavits must be permitted by the court to be considered as evidence. Affidavits produced without proper authorization cannot be relied upon as evidence to support a case. The court concludes that the decree, predominantly relying on such unauthorized affidavits, lacks a valid evidentiary basis and may be considered void.
In conclusion, the court accepts the revision petition, setting aside the lower court's order and allowing the objections filed by the petitioner. The court directs further proceedings to be conducted in accordance with the law.
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1989 (11) TMI 319
Issues Involved:
1. Maintainability of the writ petition without surrender.
2. Validity of the detention order under the Andhra Pradesh Prevention of Dangerous Activities Act, 1986.
3. Non-approval of the detention order by the State Government within the statutory period.
4. Non-reference of the appellant's case to the Advisory Board.
Summary:
1. Maintainability of the Writ Petition:
The appellant challenged the High Court's dismissal of his writ petition on the grounds that there were no extraordinary reasons to depart from the normal rule that the appellant should first surrender before seeking relief. The Supreme Court found merit in the appellant's submission that his fundamental right to liberty was threatened and that the High Court should have considered the subsequent events brought to its notice through a Miscellaneous application. The Court referred to precedents from the Bombay and Gujarat High Courts, which supported the view that an illegal order of detention could be challenged even if the intended detenu had not surrendered.
2. Validity of the Detention Order:
The appellant argued that the grounds of detention were vague, stale, irrelevant, and non-existent, and that there was a mala fide exercise of power and non-application of mind by the detaining authority. The Supreme Court noted that the High Court had dismissed the writ petition without examining the relevance or correctness of the grounds, as it found no extraordinary reasons to depart from the normal rule.
3. Non-approval of the Detention Order by the State Government:
The appellant contended that the detention order was not approved by the State Government within 12 days as required u/s 3(3) of the Act. The Supreme Court found that there was no evidence to show that the detention order was approved within the statutory period. The Court held that the detention order ceased to be in force after 12 days and was non-existent thereafter.
4. Non-reference to the Advisory Board:
The appellant also argued that his case was not referred to the Advisory Board within the prescribed period u/s 10 of the Act. The Supreme Court agreed, noting that the mandatory provision was not complied with. The Court held that the detention order could not remain in force beyond three weeks without such a reference, making the detention order invalid.
Conclusion:
The Supreme Court set aside the High Court's judgment, holding that the detention order ceased to be in force after 12 days due to non-approval by the State Government and further ceased to be in force for failure to refer the appellant's case to the Advisory Board within the statutory period. The appeal was allowed, and the detention order was quashed.
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1989 (11) TMI 318
The suits were initially defective for want of parties and barred by limitation before being cured. The joint-creditors were named as co-plaintiffs, and Khetter Mohun became a party on 2nd November 1883. The appeals were allowed, decrees reversed, and suits remanded for trial on merits. Costs to be decided accordingly.
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1989 (11) TMI 317
Issues Involved:
1. Refusal to refund the amount allegedly collected unlawfully.
2. Classification of Electrical Insulators under the Central Excise Tariff.
3. Limitation period for refund claims under Section 11B of the Central Excises & Salt Act, 1944.
4. Legality of assessments made under Item 23B of the Tariff Schedule.
5. Jurisdiction of the Excise authorities in granting refunds.
6. The doctrine of unjust enrichment in the context of refund claims.
Issue-wise Detailed Analysis:
1. Refusal to Refund the Amount Allegedly Collected Unlawfully:
The writ application challenges the respondents' refusal to refund the amount collected unlawfully from the first petitioner, Indian Rayon Corporation Ltd. The petitioners argued that the Excise Duty levied on Electrical Insulators was unlawful as the insulators were not classifiable under Item 23B of the Tariff Schedule.
2. Classification of Electrical Insulators under the Central Excise Tariff:
The petitioners contended that the Electrical Insulators manufactured by them were wrongly classified under Item 23B of the Central Excise Tariff, which pertains to Chinaware and Porcelain-ware. The Collector (Appeals) accepted the company's submission regarding the classification but limited the refund period to six months.
3. Limitation Period for Refund Claims under Section 11B of the Central Excises & Salt Act, 1944:
The primary issue was whether the Collector (Appeals) was justified in restricting the refund to a period of six months as prescribed under Section 11B of the Act. The court held that once the assessment orders are quashed, the entire matter is at large, and fresh assessments must be made. Consequently, the duty, if paid in excess, should be refunded without the limitation of six months.
4. Legality of Assessments Made under Item 23B of the Tariff Schedule:
The court quashed all assessments of Excise Duty upon Electrical Insulators made under Item 23B from April 1970 to February 6, 1978. It directed the respondents to pass fresh orders of assessment or refund for the entire period. The Assistant Collector's subsequent order held the insulators were not Porcelain-ware and should be assessed under Item 68, but the refund claims would be decided separately.
5. Jurisdiction of the Excise Authorities in Granting Refunds:
The court noted that the Excise authorities were acting in violation of the judgment and order of the court, which had become final and binding. The court held that the respondents were bound to refund the amounts collected unlawfully and could not limit the refund period to six months.
6. The Doctrine of Unjust Enrichment in the Context of Refund Claims:
The respondents argued that granting the refund would amount to unjust enrichment of the petitioners. The court rejected this argument, stating that the duty of excise is payable by the manufacturer, and any excess amount collected must be refunded. The court cited the Supreme Court's decision in Hindustan Sugar Mill Ltd. v. State of Rajasthan, which clarified that the buyer does not pay excise duty directly; it is part of the consideration for the goods.
Conclusion:
The court allowed the writ application, making the Rule absolute and issuing appropriate writs. It held that the limitation period of six months for refund claims under Section 11B of the Act does not apply when the assessments are quashed, and fresh assessments are ordered. The court also rejected the argument of unjust enrichment, stating that the refund due to the assessee cannot be withheld on this ground. The respondents were directed to pass fresh orders of assessment or refund in compliance with the court's judgment.
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1989 (11) TMI 316
Issues Involved:
1. Fundamental right to trade and do business in liquor.
2. Ultra vires the provisions of the Act.
3. Violation of Article 14 of the Constitution.
4. Taking away rights accrued to existing licensees without compensation.
5. Incidental questions.
Issue-wise Detailed Analysis:
Re. Contention No. I:
The petitioners argued that their fundamental right to trade and do business in liquor was adversely affected by the impugned Rules and that these Rules violated Articles 301 and 304 of the Constitution. The court referenced several Supreme Court decisions, including *Cooverjee B. Bharucha v. Excise Commissioner* and *Krishan Kumar Narula v. State of Jammu & Kashmir*, which initially assumed the applicability of Article 19(1)(g) to the liquor trade but allowed for extensive government regulation. However, subsequent Supreme Court decisions, such as *Sat Pal & Co. v. Lt. Governor of Delhi* and *State of M.P. v. Nandalal*, established that there is no fundamental right to trade or business in liquor, as it is considered a noxious and dangerous commodity. The court concluded that dealing in liquor cannot be considered a trade, business, or commerce within the constitutional sense, and thus, Articles 301 and 304 are not applicable.
Re. Contention No. II:
The petitioners contended that the Rules were ultra vires the provisions of the Karnataka Excise Act, 1965, arguing that creating an exclusive distributorship should be a matter of major policy enacted by the legislature. The court referred to the Supreme Court's decision in *Indian Express Newspapers (Bombay) Pvt. Ltd. v. Union of India*, which outlined the grounds on which subordinate legislation could be questioned. The court held that the Act's provisions, including Sections 13, 14, 15, and 71, did not preclude the creation of a sole distributorship. It was noted that the State has the inherent privilege to deal in liquor, and the Rules were within the scope of the Act's purposes. The court also cited the Kerala High Court's decision in *Mrs. Moni Senan v. State of Kerala*, which upheld a similar exclusive distributorship by a State-owned corporation.
Re. Contention No. III:
The petitioners argued that the Rules were arbitrary, unreasonable, and made in a colorable exercise of power. They claimed that the appointment of Mysore Sales International Ltd. (MSIL) as the sole distributor was arbitrary and lacked proper guidelines. The court rejected these contentions, noting that MSIL, as a State-controlled corporation, was presumed to act fairly and reasonably. The court also dismissed the argument that the Rules were made to destroy particular manufacturers, finding no evidence to support such allegations. The court emphasized that the State's intention was to prevent tax evasion and channelize the liquor trade through a governmental agency.
Re. Contention No. IV:
The petitioners claimed that the Rules took away rights accrued to existing licensees without compensation, violating Article 300-A of the Constitution. The court held that there is no fundamental right to trade in liquor and that the existing licenses were not affected as manufacturers could still sell their products to the distributor, and other dealers could obtain goods from the distributor. The court also noted that the Rules saved current CL. 11 licenses for their duration, and any reduction in trade volume was not a sufficient ground to nullify the State's action.
Re. Contention No. V:
The petitioners raised incidental questions, including alleged discrimination between exporters and importers and the impact on industrial users of alcohol. The court found no merit in these arguments, stating that import and export regulations were governed by specific provisions of the Act and the Rules. The court also clarified that the Rules did not ignore industrial users of alcohol, as other relevant Rules remained in force.
Conclusion:
The court dismissed the petitions, holding that:
1. There is no fundamental right to trade in liquor under Article 19(1)(g) or Articles 301 and 304 of the Constitution.
2. The impugned Rules were within the scope of the Act and did not require legislative enactment.
3. The Rules were not arbitrary or unreasonable and did not violate Article 14 of the Constitution.
4. The existing licenses were saved for their duration, and no compensation was required.
5. The Rules were enforceable immediately upon being made and did not require prior laying before the Legislature.
The court also rejected an oral application for a certificate of fitness to appeal to the Supreme Court and denied an interim stay of the Rules' enforcement.
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1989 (11) TMI 315
Issues:
Interpretation of long-term capital loss on assignment and exchange of promissory note for shares.
Analysis:
The case involved a question of law referred to the Calcutta High Court by the Tribunal under the Income Tax Act, 1961, regarding the justification of a long-term capital loss claimed by the assessee due to the assignment and exchange of a promissory note for shares. The relevant assessment year was 1975-76, with the accounting period ending on 19th April 1975. The assessee, an individual, claimed a loss of Rs. 28,215 by assigning her rights in a debt to Shyamnagar Investment Co. Ltd. in exchange for shares. The Income Tax Officer (ITO) found that the actual value of the promissory note was higher than claimed, resulting in accrued interest rather than a loss. The CIT(A) initially accepted the assessee's appeal regarding the addition made by the ITO but later rejected the claim of bad debt or business loss. Both the Revenue and the assessee appealed to the Tribunal, which remanded the case to determine the exact market value of the shares acquired. The CIT(A) subsequently found that the shares' value was below face value, leading to no excess realization for taxation. The Revenue appealed this decision, but the Tribunal upheld the CIT(A)'s findings, stating that the real value of the shares was less than face value, and the Revenue had accepted the order. The High Court concluded that the Tribunal did not commit any error of law, and as the valuation of shares was not raised on referral, the question was answered in favor of the assessee.
This judgment highlights the complexities surrounding the valuation of assets in exchange transactions and the importance of accurately determining market values to assess capital gains or losses. It also emphasizes the significance of following proper procedures and legal provisions in tax assessments to ensure fair treatment for taxpayers. The case demonstrates the thorough analysis required in tax matters, including assessing the intrinsic value of assets exchanged and considering all relevant factors to arrive at a just decision.
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1989 (11) TMI 314
Issues Involved:
1. Validity of the Rent Controller's permission u/s 21 of the Delhi Rent Control Act, 1958.
2. Scope of enquiry under section 21.
3. Requirement of notice to the tenant before issuing a warrant of possession.
Summary:
1. Validity of the Rent Controller's permission u/s 21:
The landlord's application for recovery of possession was rejected by the Rent Controller, the Rent Control Tribunal, and the Delhi High Court on the ground that the landlord's son was below the minimum age for marriage at the expiry of the limited tenancy, rendering the permission granted u/s 21 of the Act invalid. The Supreme Court held that the reason given by the landlord for the limited tenancy (son's marriage) was genuine and the estimate of time was not unreasonable. The Court emphasized that the enquiry should be limited to the existence of jurisdictional facts at the time of granting permission and not extend to other factors.
2. Scope of enquiry under section 21:
The Supreme Court clarified that the scope of enquiry when the tenant assails the validity of the Controller's permission is limited to determining whether the permission was for a genuine limited tenancy or a mere pretence to circumvent Section 14 of the Act. The Court reiterated that Section 21 is a self-contained code and should be strictly construed. The enquiry should not extend to examining the landlord's bona fide need as required under Section 14.
3. Requirement of notice to the tenant before issuing a warrant of possession:
The Court referred to the decision in J.R. Vohra's case and held that there is no obligation on the Controller to serve a notice on the tenant before issuing a warrant of possession on the landlord's application made after the expiry of the limited tenancy. The tenant is expected to raise any plea of invalidity during the currency of the limited tenancy or as soon as he discovers facts that tend to vitiate the initial grant of permission.
Conclusion:
The Supreme Court allowed the appeal, setting aside the impugned orders of the Rent Controller, Rent Control Tribunal, and the High Court. The landlord's application for recovery of possession was granted, and the respondent-tenant was ordered to pay costs and additional amounts as specified.
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1989 (11) TMI 313
Issues:
1. Validity of the appointment of the Tax Inspector by the Municipal Board.
2. Interpretation of the Government Order dated 10.4.50 regarding the appointment process.
3. Jurisdiction of the Commissioner Varanasi in setting aside the appointment.
4. Violation of principles of natural justice in setting aside the appointment without a hearing.
Analysis:
The appeal challenged the High Court's judgment dismissing a petition under Article 226, which questioned the appointment of the appellant as Tax Inspector by the Municipal Board. The Municipal Board selected the appellant over a senior Tax Collector, leading to a dispute. The Commissioner Varanasi set aside the appointment citing a Government Order from 1950. The High Court upheld this decision, prompting the appeal to the Supreme Court.
The main issue was whether the appointment of the Tax Inspector should have been through promotion only, as per the Government Order dated 10.4.50. The Court analyzed the Order and previous judgments to determine its validity. It was concluded that the Order did not mandate exclusive promotion for the Tax Inspector post, allowing for direct recruitment as well. The Court found that the Municipal Board acted within its jurisdiction by appointing the appellant directly.
Another crucial aspect was the violation of natural justice in setting aside the appointment without a hearing. The Court emphasized that the appellant had a vested right in the appointment, which could not be revoked without due process. The Commissioner's order, lacking a hearing for the appellant, was deemed illegal and void. The High Court's failure to address this violation led to the appeal's success in setting aside both the High Court and Commissioner's orders.
In conclusion, the Supreme Court allowed the appeal, overturning the High Court and Commissioner's decisions. The Court highlighted the importance of adhering to principles of natural justice and ensuring proper procedures in administrative actions. The appellant's appointment as Tax Inspector was upheld, emphasizing the need for fairness and due process in such matters.
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1989 (11) TMI 312
The Supreme Court upheld the decision of the Customs, Excise and Gold (Control) Appellate Tribunal, dismissing the appeal with no costs. (Citation: 1989 (11) TMI 312 - SC)
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1989 (11) TMI 311
... ...
... ... ..... ard the learned lawyers. We find no merit in this appeal. The appeal is dismissed.
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1989 (11) TMI 310
Issues Involved:
1. Jurisdiction to Levy Octroi Tax
2. Declaration Requirement under Rule 9
3. Current Account Facilities under Section 133 and Rule 13
4. Refund of Octroi Duty
Summary:
1. Jurisdiction to Levy Octroi Tax:
The primary issue was whether the Municipal Council had jurisdiction to levy octroi tax on goods brought within the municipal limits but not sold, consumed, or used therein and subsequently exported outside the said limits. The respondent No. 2 (Indian Oil Corporation) argued that the diesel brought within the Jodhpur Municipality was ultimately exported and sold to respondent No. 1 at Dangiawas for use, consumption, or sale outside the municipal limits. The High Court, referring to Section 104 of the Rajasthan Municipalities Act, 1959, held that octroi duty is chargeable only on goods brought within the municipality for consumption, use, or sale therein. The Court relied on the decisions in Burmah Shell Oil Storage & Distributing Co. India Ltd. v. The Belgaum Borough Municipality and Hiralal Thakorlal Dalal v. Broach Municipality & Ors., concluding that octroi cannot be levied on goods meant for use or consumption outside the municipal limits.
2. Declaration Requirement under Rule 9:
The appellant argued that no declaration as required by Rule 9 of the Rajasthan Municipal Octroi Rules, 1962 was made by the respondent No. 2, and hence, the goods should be treated as brought within the municipal limits for consumption, use, or sale therein. However, the High Court found that Rule 13, which provides for current account facilities, overrides the requirements of Rule 9. The Court held that Rule 13 is a special provision applicable to persons with current account facilities under Section 133 of the Act, and thus, the declaration under Rule 9 was not necessary.
3. Current Account Facilities under Section 133 and Rule 13:
The respondent No. 2 was provided current account facilities under Section 133 of the Act and Rule 13 of the Rules. The High Court held that under Rule 13, the octroi duty is calculated based on the total amount of goods brought in minus the goods transported outside the municipal limits. The Court found that the Indian Oil Corporation had been granted current account facilities, and therefore, the octroi duty should be charged accordingly. The High Court concluded that the Municipal Council had no jurisdiction to levy octroi on goods re-exported by the Indian Oil Corporation to retail outlets for use and consumption outside the municipal limits.
4. Refund of Octroi Duty:
The respondent No. 1 sought a refund of the octroi duty paid on the diesel exported to Dangiawas. The High Court held that there was no privity of obligation between respondent No. 1 and the Municipal Council, as the octroi was charged from respondent No. 2. However, the High Court noted an undertaking given by the appellant to refund the octroi charged on goods re-exported outside the municipal limits if the writ petitions were allowed. The Court directed that the Municipal Council refund the amount of octroi duty paid on petroleum products re-exported by the Indian Oil Corporation to Dangiawas outlet for supply to respondent No. 1, who could recover the same from the Indian Oil Corporation.
Conclusion:
The Supreme Court upheld the High Court's judgment, affirming that the Municipal Council had no jurisdiction to levy octroi on goods meant for use or consumption outside the municipal limits and that the current account facilities under Section 133 and Rule 13 exempted the need for declarations under Rule 9. The Court also upheld the direction for the refund of octroi duty. The appeals were dismissed with no orders as to costs.
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1989 (11) TMI 309
Issues Involved:
1. Liability to pay minimum guaranteed charges despite disconnection.
2. Validity and reasonableness of the agreement stipulating minimum guaranteed charges.
3. Power of the Board to enter into the agreement and enforce minimum guaranteed charges.
Summary:
1. Liability to Pay Minimum Guaranteed Charges Despite Disconnection:
The primary issue was whether the firm was liable to pay minimum guaranteed charges even after the electricity supply was disconnected on September 28, 1981. The High Court quashed the bills and certificate proceedings, holding that the Board could not claim charges post-disconnection. However, the Supreme Court found that under clause 9(b) of the agreement, the disconnection did not terminate the agreement immediately. The agreement was deemed to have continued until May 1, 1983, and thus, the firm was liable to pay the minimum guaranteed charges until that date.
2. Validity and Reasonableness of the Agreement Stipulating Minimum Guaranteed Charges:
The agreement included a clause requiring the consumer to pay minimum guaranteed charges irrespective of actual energy consumption. The Supreme Court upheld this clause, referencing historical and legal precedents that supported the reasonableness of such stipulations. The Court noted that these charges were intended to cover the Board's overhead installation expenses, which do not vary with the quantity of electricity consumed. The Court concluded that the stipulation was not "nudum pactum" and was reasonable and valid.
3. Power of the Board to Enter into the Agreement and Enforce Minimum Guaranteed Charges:
The Supreme Court examined the statutory framework, including the Indian Electricity Act, 1910, and the Electricity (Supply) Act, 1948. It found that the Board had the authority to enter into agreements for the supply of electricity and to stipulate terms, including minimum guaranteed charges. The Court held that such agreements were envisaged by the relevant provisions of law and were binding on both parties.
Conclusion:
The Supreme Court set aside the High Court's judgment, holding that the agreement was reasonable and valid, and the firm was liable to pay the minimum guaranteed charges until the agreement was deemed terminated on May 1, 1983. The appeal was allowed with no order as to costs.
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1989 (11) TMI 308
Issues Involved:
1. Jurisdiction of Civil Court vs. Controller under the Haryana Urban (Control of Rent & Eviction) Act.
2. Nullity of the Decree.
3. Applicability of Res Judicata.
4. Delay in Filing Leave Application.
Issue 1: Jurisdiction of Civil Court vs. Controller under the Haryana Urban (Control of Rent & Eviction) Act
The main contention was whether the Civil Court had inherent jurisdiction to entertain the suit for ejectment of the appellant-tenant, or if the decree was a nullity due to the exclusive jurisdiction of the Controller under the Haryana Urban (Control of Rent & Eviction) Act. The Supreme Court held that the Act provides exclusive jurisdiction to the Controller for eviction matters, and by necessary implication, the jurisdiction of the Civil Court is excluded. The Court stated, "By necessary implication the jurisdiction of the Civil Court under Section 9 of C.P.C. is excluded."
Issue 2: Nullity of the Decree
The appellant argued that the decree passed by the Civil Court was a nullity and could be challenged at any stage, including execution. The Supreme Court agreed, citing precedents such as Kiran Singh & Ors. v. Chaman Paswan & Ors., which held that "a decree passed by a Court without jurisdiction is a nullity, and that its invalidity could be set up whenever and wherever it is sought to be enforced or relied upon, even at the stage of execution and even in collateral proceedings."
Issue 3: Applicability of Res Judicata
The respondent contended that the decree had become final and operated as res judicata. However, the Supreme Court clarified that a decree passed without jurisdiction does not operate as res judicata. The Court explained, "A question relating to the jurisdiction of a Court cannot be deemed to have been finally determined by an erroneous decision of the Court... the doctrine of res judicata does not apply to a case of decree of nullity."
Issue 4: Delay in Filing Leave Application
The respondent argued that the leave application was barred by limitation. The Supreme Court found no delay in filing the leave application, noting, "The leave application was filed within the limitation from the date of original order of dismissal of the revision or on a later date dismissing the review application."
Conclusion
The Supreme Court concluded that the Civil Court lacked inherent jurisdiction to pass the decree of ejectment, rendering the decree a nullity. The decree did not operate as res judicata, and the appellant could challenge it at the execution stage. The appeal was allowed, and the parties were directed to bear their own costs. The Court stated, "The appeal is accordingly allowed. But in the circumstances parties are directed to bear their own costs."
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1989 (11) TMI 307
Issues Involved:
1. Applicability of Section 23(2) of the Land Acquisition Act, 1984 for higher solatium.
2. Applicability of Section 23(1A) for additional compensation.
Summary:
Issue 1: Applicability of Section 23(2) for Higher Solatium
The primary question was whether Section 23(2) of the Land Acquisition Act, 1984, providing for higher solatium, applies to awards made after 24 September 1984, even if the acquisition proceedings commenced before that date. The Court noted that Section 23(2) has limited retrospectivity through transitional provisions u/s 30(2). The Court referenced previous judgments, including Kamalajammaniavaru v. Special Land Acquisition Officer and Union of India v. Raghubir Singh, which clarified that higher solatium applies only to awards made between 30 April 1982 and 24 September 1984. However, the Court found that excluding cases like the present one from the benefit of higher solatium would lead to anomalies and potential constitutional issues under Article 14. Therefore, the Court held that the benefit of higher solatium should also be available to the present case, affirming the High Court's decision to grant 30% solatium.
Issue 2: Applicability of Section 23(1A) for Additional Compensation
The second issue was whether the claimant is entitled to additional compensation u/s 23(1A). Section 23(1A) mandates an additional amount at 12% per annum on the market value of the land from the date of notification u/s 4(1) to the date of the award or possession. The Court examined the transitional provisions u/s 30(1)(a) and (b), which apply Section 23(1A) to acquisition proceedings pending as of 30 April 1982 or commenced after that date. Since the acquisition in this case commenced on 26 October 1967 and the award was made on 5 March 1969, the proceedings were not pending before the Collector as of 30 April 1982. Therefore, Section 30(1)(a) and (b) did not apply, and the claimant was not entitled to additional compensation u/s 23(1A).
Conclusion:
The appeal was allowed in part. The judgment of the High Court was modified to delete the compensation awarded u/s 23(1A), while the rest of the judgment and decree were kept undisturbed. No order as to costs was made.
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1989 (11) TMI 306
whether the Bank was negligent in opening the account in the name of Sethurarman, as proprietor, Industrial Chain Concern?
Held that:- In the instant case there was no question of a reference inasmuch as the Manager himself knew Sethuraman and gave the introduction. The account was not opened by depositing any cheque but by depositing case of ₹ 100. The first cheque was paid into the account later and there is nothing to show that it formed part of the same transaction. No particulars have been proved as to the tenor of that cheque. The Manager made several inquiries which in the facts and circumstances of the case, in our view, were sufficient, for it is an accepted rule that the banker may refrain from "making inquiries which it is improbable will lead to detection of the potential customer's purpose if he is dishonest and which are calculated to offend him and may drive away his customer if he is honest.
Sethuraman was believed when he said that he was the proprietor of Industrial Chain Concern which he recently started. He showed some orders and references in proof of his business. The banker believed in existence of his business but did not meticulously examine the addresses. Sethuraman was asked as to why he wanted to come to that branch and his reply was that he expected there to have overdraft facility and when that was refused he expressed that after his business improved he would expect to be granted overdraft facilities after one year. There is no doubt that Sethuraman was a rogue, but he prepared the plan intelligently and the banker in good faith believed in his statements. We, therefore, find it difficult to hold that the Bank was negligent in opening the account accepting the deposit of cash by a person known to the Manager of the Bank under the above circumstances. Appeal allowed.
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1989 (11) TMI 305
Issues: Assessment under Kerala General Sales Tax Act, 1963 for the years 1981-82 and 1982-83, non-liability for tax under section 5A, opportunity to produce purchase bills, rejection of claim for non-liability, rectification of assessment orders under section 43, maintainability of appeals against modified orders of assessment, compliance with appellate orders, jurisdiction of appellate authority, challenge to revised assessment orders, quashing of assessment orders, opportunity for reassessment.
Analysis:
The judgment concerns assessment under the Kerala General Sales Tax Act, 1963 for the years 1981-82 and 1982-83. The petitioner had filed appeals against the original assessment, seeking non-liability for tax under section 5A for certain purchases. The Appellate Assistant Commissioner allowed the appeals in part and directed the assessing authority to amend the assessment based on the observations in the appellate order, specifically paragraph 12 of exhibit PI. The Appellate Assistant Commissioner noted that exemption for single point goods purchased with bills would be allowed if proved. However, the assessing authority amended the orders without giving the petitioner an opportunity to produce evidence to support the claim for non-liability, resulting in the rejection of the claim.
The petitioner sought rectification of the assessment orders under section 43 of the Act, believing that the orders were passed mistakenly without notice or opportunity to produce evidence. The petition for rectification was rejected, and subsequent appeals against the revised assessment orders were also dismissed by the Appellate Assistant Commissioner on the grounds of maintainability. The petitioner challenged the revised assessment orders and the dismissal of the appeals.
The High Court analyzed the provisions of the Act regarding appeals against assessment orders. Section 34 allows for an appeal against any order of assessment, without limitation on challenging revised or modified orders. The appellate authority can examine compliance with earlier orders and directions in the revised assessment. Failure to afford opportunities as directed in the appellate order can vitiate the revised assessment, allowing the assessee to challenge it in appeal.
In this case, the petitioner challenged the revised assessment orders for non-compliance with the directions and benefits conferred by the appellate order, exhibit PI. The High Court held that the failure to provide the opportunity to prove the claim for exemption as directed in paragraph 12 of exhibit PI was sufficient to challenge the revised assessment orders in appeal. The Appellate Assistant Commissioner's rejection of the appeals as not maintainable was deemed contrary to the provisions of the Act and an abdication of jurisdiction.
Consequently, the High Court quashed the revised assessment orders for the years 1981-82 and 1982-83, as well as the order dismissing the appeals. The assessing authority was directed to provide the petitioner with an opportunity to prove the claim for non-liability of single point goods as directed in exhibit PI and complete the reassessment within three months from the date of the judgment.
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1989 (11) TMI 304
Issues:
Validity of composition order and refund of amount collected.
Analysis:
The petitioner, a dealer, issued a cash bill and way-bill for 50 drums of ground-nut oil to be transported to a buyer. However, upon inspection, it was found that the lorry contained 40 empty drums, leading to the imposition of tax by the Check-post Officer. Subsequently, a composition order was passed based on the dealer's admission of irregularities in issuing spurious sale bills. In the assessment proceedings, the disputed turnover was initially included but later deleted after appeal. The petitioner challenged the composition order, arguing that since no tax was leviable, no penalty or composition should have been imposed. The court noted that the composition amount was collected due to the issuance of spurious bills, not for tax evasion, and upheld the composition order despite the subsequent assessment deleting the turnover.
In a separate argument, the petitioner contended that the composition should fall under clause (b) of section 32, limiting the composition amount to Rs. 1,000. The court agreed that the offense of issuing spurious bills did not involve tax evasion, placing it under clause (b) rather than clause (a) which pertains to tax-related offenses. Therefore, the composition amount should not exceed Rs. 1,000 as per the relevant provision. Consequently, the court allowed the writ petition in part, directing the state to refund the excess amount collected as composition, retaining only Rs. 1,000. No costs were awarded in the matter.
Overall, the judgment clarified the distinction between tax-related offenses and other offenses under the Andhra Pradesh General Sales Tax Act, determining the appropriate composition amount based on the nature of the offense committed by the dealer.
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