TMI Blog1963 (4) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer, inter alia, contending that the applicant was an employee of a firm carrying on business in the name of M/s. Parasaram Parumal, and the tenders submitted by the applicant were submitted by him at the instance of his employer as its nominee or agent. In the alternative, it was contended that after the allotment was made in favour of the applicant, the applicant had assigned the rights obtained by him under the quota to his employer M/s. Parasaram Parumal, and they were responsible for payment of the tax, and has, in fact, shown all the transactions in their books of account. These contentions were not accepted by the Sales Tax Officer, and the Sales Tax Officer held that the applicant was not liable to pay any sales tax, but he was liable to pay general sales tax amounting to Rs. 1,000-6-0 and purchase tax amounting to Rs. 1,037-14-0 and also a penalty of Rs. 500 was imposed on the applicant under sub-section (7) of section 14 of the Act for failure on his part to get himself registered as a dealer under the Sales Tax Act. Against this decision of the Sales Tax Officer, the applicant preferred an appeal to the Assistant Collector of Sales Tax, but the same was dismissed. Ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure to get himself registered as a dealer inasmuch as the default was not intentional. This contention also was accepted by the Deputy Commissioner, and the penalty imposed under section 14(7) was set aside. The Deputy Commissioner, however, held that the applicant was liable to pay penalty under section 16(4) for late payment of the balance of the tax. He thus held the applicant to be liable to pay purchase tax and penalty for late payment of that tax. Against this order of the Deputy Commissioner, the applicant filed a revision before the Sales Tax Tribunal. The first contention raised on behalf of the applicant before the Tribunal was that the Government of India, from whom the sugar was purchased, was not a person within the meaning of section 10 of the Act, and, therefore, the applicant was not liable to pay any purchase tax for the purchase of sugar made by him from the Government of India. The Tribunal rejected this contention. The second contention urged was that the applicant had taken delivery of sugar while the goods were in the course of import, inasmuch as delivery was obtained before the goods crossed the customs barrier. The Tribunal accepted the finding of the dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Director (Food) Bombay is a person within the meaning of section 10 of the Bombay Sales Tax Act, 1953 and whether purchase tax under section 10 can be levied on the purchase effected from the Regional Director (Food) Bombay? (2) Whether in the facts and circumstances of the case it can be said that the purchase of sugar was in the course of business? (3) Whether the principle of estoppel is applicable in the facts and circumstances of the case so as to preclude the applicant from pleading the alleged true and substantial state of affairs on the evidence on record before the Tribunal?" Turning to the first question, on the question as it is framed, there appears to be hardly any room for argument, and the answer will have to be in favour of the department. The question framed is whether the Regional Director (Food), Bombay, is a person within the meaning of the Act. There cannot be any doubt that the Regional Director (Food) is an individual and necessarily a person. Mr. Joshi, however, submitted that the contention raised before the Tribunal was not that the Regional Director (Food), Bombay, was not a person, but the contention raised was as to whether the Government of Indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of India or Government of a State are excluded from the scope and ambit of that expression in construing such provisions of a statute which impose liability to pay tax or which are penal in nature. He places reliance on certain passages from the judgment reported in Madras Electric Supply Corporation Ltd. v. Boarland (Inspector of Taxes) [1955] 27 I.T.R. 612. We find it difficult to accept Mr. Joshi's contention. The expression "person" is of a wider amplitude. Earl Jowitt in his English Dictionary says, "In jurisprudence a 'person' is the object of rights and duties that is capable of having rights and being liable to duties............. Persons are of two kinds: natural and artificial." In Salmond on Jurisprudence, 11th Edition, at page 350, it is observed: "So far as legal theory is concerned, a person is any being whom the law regards as capable of rights or duties. Any being that is so capable is a person, whether a human being or not, and no being that is not so capable is a person, even though he be a man. Persons are the substances of which rights and duties are the attributes. It is only in this respect that persons possess juridical significance, and this is the excl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the matter, it allowed the revision and sent the case back to the trying Magistrate for disposal in accordance with law. Against this decision, an appeal was taken to the Supreme Court by the Director on obtaining special leave, and it has been held that it is the rule of interpretation of a statute that the Crown or State is not bound by the statute unless the statute so provides in express terms or by necessary implication. This was the rule of construction prior to the Constitution, and it is still a good law in force applicable in India after the Constitution. It would be noticed that nowhere in this decision, it has been held that the State or the Government of India or the Crown is not a person within the meaning of section 386(1)(a) of the Act. All that has been held on the application of the aforesaid rule of construction of statute is that Government is not bound by its statute. In other words, Government is not liable to be penalized by reason of the provisions of the statute unless the statute in express terms or by necessary intendment fastens the liability on the Government. It should also be noticed that the question with which their Lordships were dealing was the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 17 of the Income Tax Act, 1945, in respect of a balancing charge alleged to arise on the sale of the plant and machinery. A question arose whether rule 11(2) was applicable to the case of a succession to a trade by the Crown. In other words, the question that arose for consideration was whether the word "person" occurring in rule 11(2) included the Crown. The matter went to the House of Lords, and the learned Law Lords held that the Crown was included in the word "person" in rule 11(2). At pages 620-621 of the report, Law Lord MacDermott observed: "The appropriate rule, as I understand it, is that in an Act of Parliament general words shall not bind the Crown to its prejudice unless by express provision or necessary implication. That, however, is and has long been regarded as a rule of construction, and such being its nature its application to the charging provisions of paragraph 1 of Schedule D seems to me to make an end of the respondent's submission on this aspect. In that paragraph the word 'person' is a general word capable of including the Crown, but there is no express provision and nothing by way of necessary implication to make it include the Crown, and so, as a mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore of M/s. Parasaram Parumal, and he is not liable to pay tax. In our opinion, this argument cannot be sustained in view of the facts found. The fact found is not that M/s. Parasaram Parumal was the purchaser, but, on the other hand, the fact found is that the applicant is the purchaser, and after purchasing the goods, the applicant has handed over the goods to M/s. Parasaram Parumal. The fact found further is that the applicant had frequently submitted tenders for grant of quota of sugar. Quotas had been granted to him from time to time. The applicant paid the price of the sugar obtained by him on different quotas, and then handed over the sugar to M/s. Parasaram Parumal without obtaining any consideration from him. The Tribunal has further found that the sugar was not purchased for private consumption. In short, the findings are that as a regular course, the applicant had been from time to time purchasing sugar from the Government and supplied the sugar obtained by him to M/s. Parasaram Parumal. These being the facts found, there cannot be any doubt that the applicant's course of business was to submit tenders for purchase of sugar, purchase the sugar and then hand it over to s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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