TMI Blog1955 (8) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... the firm and not the managing partner, hence he cannot be held criminally liable for non-payment of the sales tax. On fact this defence is negatived by the evidence of the Sales Tax Officer who made the assessment on the firm, for he declares that it was within his knowledge that the applicant managed the affairs of the firm and that he (the applicant) interviewed him many times in connection with the assessment of the tax. Besides, even if I were to assume for the sake of argument that the applicant was not directly managing the affairs of the firm I find no justification for the view that he as a non-managing partner is not liable to prosecution. Under sec- tion 3 of the Act every dealer must pay sales tax provided certain specified conditions are fulfilled, while under section 2(c) a "dealer" means any person or association of persons carrying on the business of buying or selling and supplying goods, and includes every firm. Sec- tion 14(b) of the Act fixes a criminal liability on any person who fails to pay the tax. Every partner of a firm is jointly and severally res- ponsible for the dues of the firm. When a business is carried on by a partnership every partner, whether he ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tly was not liable. Following the Madras decision the learned author of the commen- tary referred to above has observed: "Since the assessment stands against the firm, it is that firm which is liable for the payment of tax and the firm itself should be prosecuted, if it makes a default, and not any individual partner thereof, unless the assessment was made and a notice of demand issued in their names individually." In my opinion, the Madras case is clearly distinguishable, for, unlike the present applicant, Jacob was neither a partner of the firm when the sales tax was assessed on it nor was any notice of demand served on him, and it may be pointed out that Subba Rao, J., himself appears to have been of the opinion that Jacob's prosecution would have been valid under certain conditions, for we find his Lordship observing at the end of para 4 of the Report: "Though Jacob may be made liable if the proper procedure had been followed as a partner of the firm-on that question I do not express my final opinion............" Relying on certain observations in the Madras judgment the applicant's learned counsel has contended that a prosecution cannot be valid unless the firm is prosecut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed above, where at page 56 of the Report he held: "There is no law that when an offence is committed by a firm either all or none of the partners must be prosecuted." I therefore repel the applicant's contention in this regard. Indeed, here again I should like to lay emphasis on the expression "any person" occurring in section 14, for it reveals that the intention of the Legis- lature was to fix a criminal liability on all or any of the partners who failed to pay the firm's sales tax in due time. (1) (1933) A.W.R. 288. (3) [1951] 2 S.T.C. 53; 52 Cr. L.J. 1040. (2) A.I.R. 1951 All. 44. The matter may be viewed from another angle. The liability for the payment of the tax is by virtue of section 3 of the Act cast on every "dealer". It is the "dealer" who has to make the payment within the time specified in the notice-vide section 8. Section 2(c) makes it clear that a "dealer" means "any person or association of persons carrying on the business.........", and consequently every person carrying on the business individually or along with others is liable under section 14. Some discussion has also centred round the observation in the Madras judgment that Jacob could not be prosecuted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, a defendant should not be found guilty of an offence against the criminal law unless he has got a guilty mind." The decision was followed by a Division Bench of this Court in Mohammad Ahmed v. King Emperor(1). The law being thus found unambiguously settled we have to see whether the statute governing the case before me has expressly or by necessary implication ruled out mens rea as a constituent part of an offence under section 14 (b) of the Sales Tax Act. I am firmly of opinion that it has been ruled out. Section 14 prescribes six classes of offences numbered as (a) to (f). Out of these (a), (d) and (e) include the words "wilfully " or "fraudulently". The offence under (b), the offence of which the applicant has been found guilty, is however innocent of any such adverb. Had clause (b) commenced with any such qualifying word as "wilfully" or "intentionally" or "knowingly" or "dishonestly" the existence of mens rea on the part of the accused would have been absolutely necessary. Since such adverbs have been omitted, and no doubt omitted deliberately, from clause (b), whereas they are included in clauses (a), (d) and (e), it follows by necessary implication that the Legis- latur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll require to be enforced, as often as the Muni- cipal Board may consider necessary by institution of a second prosecu- tion, in which the question for consideration will be, how many days have elapsed from the date of the first conviction under the same section during which the offender is proved to have persisted in the offence, and secondly, the appropriate amount of the daily fine to be imposed under the circumstances of the case, subject to prescribed maximum of Rs. 5 per diem." His Lordship's decision has been followed by this Court in all subsequent cases. The view of the Calcutta High Court is also the same but for a different reason, for a Division Bench of that Court held in Ram Krishna Biswas v. Mohendra Nath Mazumdar(2), decided in 1900 that an order for payment of a daily fine is illegal inasmuch as it is an adjudication in respect of an offence which has not been committed when such order is passed. The recurring fine imposed on the present applicant is therefore illegal and must be set aside. In the result his conviction under section 14 (b) of the U.P. Sales Tax Act and the fine of Rs. 500 thereunder is upheld. But the order imposing a fine of Rs. 10 per day on hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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