TMI Blog1976 (3) TMI 215X X X X Extracts X X X X X X X X Extracts X X X X ..... P., Hyderabad[1970] 25 S.T.C. 425., the Appellate Tribunal held that in an appeal under section 21 of the Act the assessees are entitled to dispute the liability of a particular turnover or the rate of tax, even though they have not done so before the authorities below. In these three tax revision cases the learned Government Pleader has contended that the Tribunal has no jurisdiction under section 21 of the Act to decide that portion of the original order of assessment under section 14 of the Act, against which no appeal has been filed and has become final, and that the Tribunal is not competent to entertain an appeal directly against it which was not the subject-matter of an appeal before the Assistant Commissioner. To substantiate his contention, the learned Government Pleader has relied upon the two Bench decisions of this Court, viz., T.R.C. No. 53 of 1967 dated 19th November, 1970, and the decision in Kaliki Veera Reddy and Co. v. State of Andhra Pradesh[1974] 34 S.T.C. 517., and also the three decisions of the Madras High Court reported in Easun Engineering Co. Ltd. v. Government of Madras[1974] 33 S.T.C. 350., State of Madras v. Spencer and Company Limited[1974] 34 S.T.C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowing exemption on a turnover of Rs. 13,98,758.78. The respondent preferred an appeal to the Assistant Commissioner (Commercial Taxes), Kakinada, disputing the assessment on a turnover of Rs. 1,06,410.06 comprising of several items. The Assistant Commissioner partly allowed the appeal and the orders of the Assistant Commissioner were given effect to in the Commercial Tax Officer's proceedings dated 26th July, 1968, refixing the net turnover as Rs. 16,98,933.57 and this turnover was subjected to tax at 1 per cent as it related to inter-State sales of rice. The Deputy Commissioner, Kakinada, on examination of the assessment records noticed that the assessing authority taxed inter-State sales of rice at 1 per cent whereas these turnovers had to be taxed at 1 per cent. Further, he was of the view that the exemption granted by the assessing authority on a turnover of Rs. 30,182.66 relating to inter-State sales of gunnies was irregular and contrary to the provisions of the Act. He, therefore, brought those turnovers to tax, the inter-State sales of rice at per cent additional tax and the inter-State sales of gunnies at 2 per cent. The respondent preferred an appeal to the Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stant Commissioner partly allowed the appeal on a turnover of Rs. 9,000. In the appeal against the order of the Assistant Commissioner to the Tribunal, the respondent sought to question the rate of tax for the first time. This was objected to by the State Representative on the ground that the assessment had become final. The Sales Tax Appellate Tribunal, however, held that it had jurisdiction under section 21(4)(ii) to take into consideration the entire law and facts at the time of hearing of the appeal. They however held that as this point had not been raised before the assessing authority and the Assistant Commissioner, the matter had to be remanded to the assessing authority for fresh disposal. In the revision petition filed by the State, contentions identical to that raised in T.R.C. Nos. 23 and 24 of 1974 were advanced. All these revision cases were heard in the first instance by Kondaiah and Gangadhara Rao, JJ. The learned Government Pleader relied upon two Bench decisions of this Court in T.R.C. No. 53 of 1967 dated 19th November, 1970, and Kaliki Veera Reddy and Co. v. State of A.P.[1974] 34 S.T.C. 517. as well as other decisions of the Madras High Court in support of his c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f this Act.............. may............ appeal to such authority as may be prescribed." Section 19(2) says that the appeal shall be in such form and verified, in such manner, as may be prescribed and shall be accompanied by a fee calculated at the rate of one per cent of the tax under dispute, subject to a maximum of rupees fifty. Section 19(3) says: "The appellate authority may.................. (a) confirm, reduce, enhance or annul the assessment or the penalty, or both; or (b) set aside the assessment or penalty, or both, and direct the assessing authority to pass a fresh order after such further inquiry as may be directed; or (c) pass such other orders as it may think fit. (4) Before passing orders under sub-section (3), the appellate authority may make such inquiry as it deems fit or remand the case to any subordinate officer or authority for an inquiry and report on any specified point or points. (5) Every order passed in appeal under this section shall, subject to the provisions of sections 20, 21, 22 and 23, be final." Section 20 provides for revision suo motu by the Board of Revenue and section 20(2) says that such powers may be exercised by the Deputy Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of the Act may appeal to the authorities referred to in that rule. Rule 33(1)(a)(iii) and (iv) deal with appeals to the Assistant Commissioner from the orders of the Commercial Tax Officer. Rule 33(2) provides that the appeals shall be in form I and verified in the manner specified in the rules. Rule 33(4) provides that the appellate authority shall pass orders as laid down in sub-section (3) of section 19. Form I contains seven columns. Out of these, the following columns are relevant for the purpose of these revisions. "Col. 6: Relief claimed in appeal- (a) Turnover determined by the assessing authority. (b) If turnover is disputed- (i) disputed turnover. (ii) tax on disputed turnover. (c) If rate of tax is disputed- (i) turnover involved. (ii) amount of tax disputed. (d) Any other relief claimed." The appeal memorandum has to be accompanied by a treasury receipt in support of having paid the fee calculated at the rate of one per cent of the disputed tax, subject to a maximum of fifty rupees. Rule 38 deals with appeals under section 21 to the Appellate Tribunal. Under this rule the appeal shall be in form II. Form II contains 9 columns. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions. Section 21 confers a right to appeal on any dealer objecting to an order passed or proceeding recorded by any prescribed authority on appeal under section 19, or by a Deputy Commissioner under section 20. There is no general power granted to the Tribunal to interfere in appeal against the orders of the tribunals below unless there is an appeal preferred by the dealer objecting to an order passed or proceeding recorded. From this it is clear that the subject-matter of appeal before the Tribunal is only that part of the order of the authority below, which is objected to by the dealer. If the dealer had not objected to any part of the order of assessment even in his appeal before the Assistant Commissioner, it is impossible to say that he has any objection to that part of the order in the subsequent appeal before the Tribunal. Under section 21(3) the appeal before the Tribunal has to be in the prescribed form and has to be accompanied by the prescribed fee. "Prescribed" is defined by section 2(1)(1) of the Act as meaning "prescribed by the Rules made under the Act". Under rule 38 of the Sales Tax Rules, 1957, an appeal under section 21 has to be in form II. It is also provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is not the subject-matter of the appeal, the Tribunal may pass orders with respect to that part also. In this connection, reference may also be made to section 19, which deals with the right of first appeal against an order of assessment. Here again, under section 19(1) the right is conferred on any dealer objecting to an order passed or proceeding recorded by any authority. The appeal has to be in such form as may be prescribed and shall be accompanied by a fee calculated at the rate of 1 per cent of the tax disputed. Column 6 of form I, which relates to appeals to the Assistant Commissioner, directs the assessee to state the relief claimed in appeal; if the turnover is disputed, the disputed turnover and the tax on disputed turnover. Thus, it is clear from section 19 of the Act, the relevant rule, rule 33 and form I, that the subject-matter of the appeal is only the turnover, disputed tax or rate of tax. There is no general right conferred upon the Assistant Appellate Commissioner to interfere with any order of assessment. Under section 19(3), the appellate authority has, no doubt, the power to confirm, reduce, enhance, annul or set aside the assessment and pass such other orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as it is against the assessee is wrong either wholly or in part and the Deputy Commissioner revising the assessment in favour of the assessee if he is so satisfied. The learned counsel for the petitioners submitted that in the history of revisions suo motu by the Deputy Commissioners there would not be even a single instance where they reduce the assessment. If that were so, we express our regret that the Deputy Commissioners are using their powers of revision only for enhancing the assessment. As the Deputy Commissioners are exercising their revisional powers in a judicial capacity it is not only open to them, but it is their duty to reduce the assessment if they are satisfied that the order of assessment is to any extent illegally passed against the assessee. But the mere fact that the Deputy Commissioners do not generally reduce but only enhance the assessment in exercise of their revisional powers is no ground for holding that in an appeal against their orders before the Tribunal the assessee can be permitted to agitate matters which were not raised before the Deputy Commissioners. We are therefore in agreement with the view expressed by a Division Bench of this Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tled to rehear the case, but its power to rehear is confined only to the subject-matter of the appeal, unless express powers are conferred on the Tribunal to deal with the matters which are not the subject-matter of the appeal. Similarly, the power to pass orders as it thinks fit, though wide in its terms, should be confined only to passing orders with reference to the subject-matter of the appeal. The learned Judges also referred to the provisions of Order 41, Rule 33, Civil Procedure Code, as an instance of the wide power conferred on the court of appeal under the Civil Procedure Code by enabling the Appellate Tribunal to pass any decree notwithstanding the fact that the appeal was only to a part of the decree. The argument based upon Order 41, Rule 33, Civil Procedure Code, does not in any way help the assessee. On the other hand, the introduction of a specific provision like Order 41, Rule 33, Civil Procedure Code, would indicate that but for that provision there would be no power in the appellate court to pass a decree in regard to matters which were not the subject-matter of the appeal. Moreover, it is to be remembered that we are concerned with a second appeal before the App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect of particular turnover. The Appellate Commissioner having dismissed the appeal, on second appeal, taking advantage of the supervening decisions rendered by the High Court and the Supreme Court the assessee attempted to resurrect the entire claim. It was held that the Tribunal could not consider the claim given up by the assessee before the Assistant Appellate Commissioner. Dealing with the argument based upon the powers granted to pass orders as it thinks fit under section 36(3)(a)(iii) of the Madras General Sales Tax Act, 1959, it was observed that this expression should be so construed as to enable the Tribunal to pass such further orders as would be necessary and which touch upon the matters in issue in the appeal before him. The same view has been expressed in the subsequent decisions by the Madras High Court (vide Easun Engineering Co. Ltd. v. Government of Madras[1974] 33 S.T.C. 350. and State of Madras v. Spencer and Co. Ltd.[1974] 34 S.T.C. 249.. In passing, it may also be noticed that under section 12-A(4) of the Madras General Sales Tax Act, 1939, which was considered by this court in Thippanna Rayappa v. Government of Andhra[1957] 8 S.T.C. 660.), the Appellate Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion as to whether there was any decision of the Appellate Commissioner on the matter which was not the subject of appeal before him. They observed: "It is difficult to imagine how an assessee can be heard to say that, though he did not claim any particular relief in the appeal preferred before the Appellate Assistant Commissioner, and the Appellate Assistant Commissioner had therefore no occasion to decide whether such relief should be granted or not, he is still aggrieved by the decision of the Appellate Assistant Commissioner in not granting such relief to him. How can an assessee complain that an order does not grant him a particular relief, when such relief is not claimed by him in the appeal? How can it be said by an assessee that the Appellate Assistant Commissioner erred........" These observations apply equally to the provisions relating to appeals under the Sales Tax Act also. Reference was made to certain decisions in which it has been held either under the Income-tax Act or under the Sales Tax Act that additional grounds may be raised before the Appellate Tribunal, or that questions of law may be argued for the first time before the Tribunal, even though they were n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relevant provisions which we have considered above. For the reasons which we have stated, we are clearly of the view that the Tribunal has no power to grant relief in favour of the assessee in regard to a matter which was not objected to in the appeal before the Appellate Assistant Commissioner and which has, therefore, become final. The learned counsel for the assessees also submitted that as far as this court is concerned, the decision in Thippanna Rayappa v. Government of Andhra[1957] 8 S.T.C. 660. has held the field for nearly twenty years and it was being followed by the Appellate Tribunals in the State. In a large number of cases the Appellate Tribunal was passing orders in appeal even in regard to matters in which the assessee had not preferred an appeal before the Assistant Commissioner. In view of the well-known doctrine of stare decisis he submitted that this court should allow that view to stand, as taking a different view will cause considerable hardship and upset a large number of decisions rendered by the Tribunal. He referred to Income-tax Commissioner, West Bengal v. B. Malhotra[1971] 81 I.T.R. 759 (S.C.); A.I.R. 1971 S.C. 2219., where it was observed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interpretation put upon the corresponding provision in the previous Act and, therefore, the same interpretation should be placed upon the provisions by this court. In Bengal Immunity Co. v. State of Bihar[1955] 6 S.T.C. 446 (S.C.);, the Supreme Court observed: "It is a well-settled rule of construction that when a statute is repealed and re-enacted and words in the repealed statute are reproduced in the new statute, they should be interpreted in the sense which had been judicially put on them under the repealed Act, because the legislature is presumed to be acquainted with the construction which the courts have put upon the words, and when they repeat the same words, they must be taken to have accepted the interpretation put on them by the court as correctly reflecting the legislative mind." In S.D.S. Srivastava v. Union of IndiaA.I.R. 1974 S.C. 338., it was observed that if Parliament, which is deemed to be aware of the declaration of law by the Supreme Court, did not alter the law, it must be deemed to have accepted the interpretation of the Supreme Court even though the correctness of it may be open to doubt. Similarly, in Indian Oxygen Ltd. v. Their WorkmenA.I.R. 1972 S. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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