TMI Blog1979 (9) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... cing vanaspati, the petitioner-firm used to purchase seeds, such as groundnuts, etc., and oil. According to the petitioner its purchases fell in the following four categories: (1) The petitioner-firm purchased oil from outside the State of Gujarat on giving form No. C and paying 3 per cent tax thereon under the Central Sales (2) The petitioner-firm purchased seeds after payment of tax from the market in the State of Gujarat and crushed the same, extracted oil and manufactured vanaspati therefrom. (3) The petitioner-firm purchased oil from the Gujarat market on executing form No. 19 under the Gujarat Sales Tax Rules. (4) The petitioner-firm purchased oil in the market after paying sales tax thereon to the vendors. In the course of assessment proceedings for S.Y. 2028, under the provisions of the Act, the petitioner-firm claimed that it was entitled to set-off under rule 42 of the Rules framed under the said Act. The said claim was in respect of the sales tax paid by the petitioner on its purchases of oil from the local market out of which vanaspati was manufactured and sold within the State or in the course of interState trade and commerce after recovering tax from the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation No. 47 of 1977. The petitioner-firm raised the same contentions which it had raised before the Assistant Commissioner of Sales Tax, namely, that in view of the two distinct separate channels maintained by the petitioner-firm with all the detailed registers the petitioner-firm had clearly established that the vanaspati sent on consignment basis outside the State of Gujarat was only from vanaspati manufactured out of oil purchased on executing C form and groundnuts purchased in the local market on payment of sales tax and oil extracted therefrom. The Sales Tax Tribunal relying on its earlier decision in the case of Prabhat Solvent Extraction Industries Pvt. Ltd. dismissed the petitioner's application by its order dated 27th December, 1977. The Sales Tax Tribunal took the view that as the plant was a single one in which vanaspati was manufactured from the aforesaid two channels, the contention of the petitioner-firm could not be accepted, and that under the second proviso to rule 42, the authorities were entitled to deduct 3 per cent on the total sale price of vanaspati consigned outside State and sold there and deduct the same from the set-off available to the petitioner-firm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be entitled to apply for a reference against the said decision of the Tribunal on the two channel theory. It appears that after the said order of remand by consent of the parties in Special C.A. No. 470 of 1977, the Tribunal reheard the said Revision Application No. 47 of 1977 and by its judgment dated 16th February, 1979, decided against the petitioner on the two channel theory on the same lines on which it had earlier rejected the said theory. However, as regards the set-off available, the Tribunal followed the principles laid down by this Court in S.T.R. No. 6 of 1976 (Prabhat Solvent Extraction Industries Pvt. Ltd. v. State of Gujarat [1982] 49 STC 322) and the petitioner as well as the revenue submitted an agreed statement as regards the set-off available to the petitioner under rule 42, which amount came to Rs. 1,04,823. On that agreement the Tribunal held that the petitioner was entitled to a set-off of Rs. 1,04,823. It appears that thereafter the State of Gujarat filed an application before the Tribunal on 20th February, 1979, requesting the Tribunal to rehear the aforesaid revision application already decided by it. According to the State of Gujarat, the figures of set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and null and void. Mr. J.R. Nanavati, the learned Advocate appearing for the respondents, raised a preliminary contention to the effect that the impugned notice had not decided anything against the petitioner-firm. It was a mere notice calling upon him to show cause why the order of the Assistant Commissioner should not be revised by the Deputy Commissioner and that the petitioner will have full opportunity to put forward his contentions before the Deputy Commissioner of Sales Tax in pursuance to the said show cause notice and thereafter if the final order is passed against the petitioner, it has the remedy under the Act of going higher-up to the Tribunal by way of further revision and also proceed still higher-up by claiming a reference to this Court. Consequently, according to Mr. Nanavati, the present petition was premature. So far as the preliminary objection of Mr. Nanavati is concerned, we will deal with it at this stage. The aforesaid submissions of Mr. Kaji, which we have reproduced, seek to attack the impugned notice issued by the Deputy Commissioner of Sales Tax on the ground of lack of jurisdiction. Mr. Kaji's contention is that once a revisional order was already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while the Assistant Commissioner of Sales Tax exercised powers under section 67(1) seeking to suo motu revise the order of the Sales Tax Officer, he had invoked powers of revision on the same subject-matter which had inhered in the Commissioner under section 67(1)(a) of the Act and thereafter on the same subject-matter the Deputy Commissioner of Sales Tax acting as Commissioner could not reinvoke the revisional power once again under section 67(1)(a). Mr. J.R. Nanavati combated the aforesaid submission of Mr. Kaji and submitted that under section 67(1) of the Act, the Commissioner has got jurisdiction to suo motu revise within three years from the date of the order, any order passed by any officer appointed under section 27 to assist him. Under section 27(2) the Assistant Commissioner is shown to be one of the officers appointed to assist the Commissioner. Mr. Nanavati further submitted that under section 27(5) of the Act, the Deputy Commissioner has all the powers of the Commissioner and can exercise in the area within his jurisdiction all such powers and can perform all the duties conferred or imposed on the Commissioner by or under the Act. Consequently, the impugned notice by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his Act, and an Additional Commissioner, if any be appointed, shall, save as otherwise directed by the State Government, have and exercise within his jurisdiction all the powers and perform all the duties, conferred or imposed on the Commissioner by or under this Act. (5) A Deputy Commissioner shall have and exercise in the area within his jurisdiction all the powers, and shall perform all the duties, conferred or imposed on the Commissioner, by or under this Act; but the Commissioner may, by order published in the Official Gazette, direct that any Deputy Commissioner, or all Deputy Commissioners generally, shall not exercise such powers or perform such duties as are specified in the order, and thereupon such Deputy Commissioner or, as the case may be, all Deputy Commissioners, shall cease to exercise those powers and perform those duties. The Commissioner may in like manner revoke any such direction and thereupon the powers or duties exercisable or performable by such Deputy Commissioner or, as the case may be, all Deputy Commissioners before such direction was issued, shall be restored to him or them. (6) Assistant Commissioners, Sales Tax Officers and other officers shall wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal jurisdiction under section 67(1), he did so as Commissioner by virtue of section 27(6) and revised the order of the Sales Tax Officer, who is one of the officers appointed under section 27 to assist the Commissioner. Thus the power under section 67(1)(a) qua the same subject-matter came to be fully exercised and was exhausted. Thereafter the Deputy Commissioner under the same section 67(1) read with section 27(5) could not have reinvoked the same revisional power of the Commissioner qua the same subject-matter when the power was once exercised and was already exhausted. Under the circumstances, we find that Mr. Kaji's submission is well-justified that the impugned notice seeking to re-exercise the same revisional powers qua the same subject-matter, once that power was already exhausted on an earlier occasion, is patently bad. Mr. Kaji in support of his submission relied upon the judgment of the Division Bench of this Court consisting of A.D. Desai and B.K. Mehta, JJ., in, Special Civil Application No. 1659 of 1972 decided on 17th August, 1973. In the aforesaid special civil application this Court was concerned with the legality of the notice issued by the Assistant Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid case, it was observed by A.D. Desai, J., on behalf of the Division Bench as under: The question is, can the same authority in the exercise of the same power of revision under section 27 revise its own previous order passed in revision in respect of the same subject-matter? Under section 27 the power of revision is conferred on the Commissioner. The Commissioner can delegate the same power and the delegates when it exercises the power does so as a Commissioner. The order which a delegates passes in revision is in effect the order of the Commissioner. When an officer exercises his power as a Commissioner, the power of the Commissioner to revise an order is exhausted. The Commissioner or his another delegates cannot exercise the power of revision over again in respect of the same subject-matter. In the present case what has happened is that in passing the order at annexure A/8 the Assistant Commissioner, respondent No. 2, exercised the power of revision and in exercise of that power reviewed the order at annexure A/6 which was passed by the Deputy Commissioner in exercise of the revisional powers vested in him as a Commissioner under section 27 of the Ordinance. The net re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appointed to assist the Commissioner under section 27. Once for a given subject-matter this power is exercised, either by the Commissioner himself, or by the Deputy Commissioner or by the Assistant Commissioner, as the case may be, on account of section 27(5) or (6) of the Act, the revisional power qua the same subjectmatter is fully exhausted. It was a mere accident that in the present case at the prior stage the Assistant Commissioner exercised power of revision under section 67. The Commissioner himself could have done it and if the Commissioner would have himself exercised the power under section 67 on the same subject-matter at that earlier occasion, the respondent could never have contended that later on a second revision regarding the same subject-matter could have been entertained by the Deputy Commissioner acting as the Commissioner. Mr. Nanavati also agreed to this limited extent. But in his submission in the present case instead of the Commissioner, the Assistant Commissioner exercised the power under section 67 on the prior occasion and once he exercised power, he exercised it on his own and not as the Commissioner. It is difficult for us to agree to this submission o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been delegated to the Assistant Commissioner, but once the Assistant Commissioner exercised his appellate powers under section 65 of the Act, his decision as an appellate authority was itself made subject to further revision by virtue of section 65(7), and consequently, it could not be said that the Commissioner or for that matter the Deputy Commissioner had no jurisdiction to revise the appellate order passed by the Assistant Commissioner under section 67. The question which had arisen for consideration before the Division Bench of J.B. Mehta and T.U. Mehta, JJ., was not the same which has arisen before us. On the contrary the question which we have to decide is squarely governed by the earlier decision of this Court in Special C.A. No. 1659 of 1972. In fact, J.B. Mehta, J., speaking for the Division Bench in the later case, had made it clear that in case of re-exercise of revisional powers the situation would be entirely different. In the closing stages of the judgment in Special C.A. No. 351 of 1975, while dealing with the final submission of Mr. Nanavati, in the context of the earlier decision of this Court in Special C.A. No. 1659 of 1972, J.B. Mehta, J., speaking for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al set up, specifically created by the legislature, so that the errors in tax assessments could be corrected by these various remedies under the Act when civil court's jurisdiction was excluded in view of the self-contained code making ample provision for correction of errors, so that the correct tax could be assessed and levied. That decision only lays down a simple ratio that under the same provision revisional jurisdiction once exercised was exhausted and it could not be exercised again and again to set at naught the earlier order." Thus, the aforesaid decision of the later Division Bench of this Court instead of going against the decision reaffirms the earlier view of this Court in Special C.A. No. 1659 of 1972. The question before the Division Bench consisting of J.B. Mehta and T.U. Mehta, JJ., was a limited one whether the appellate order of the Assistant Commissioner can be revised by the Commissioner under section 67 and in the light of hierarchical set up of the scheme of judicial subordination it was held that such revisional jurisdiction can be invoked to revise appellate order passed under section 65. But so far as the question of reexercise of revisional jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f his power under section 20(3) issued a notice to the appellant on 21st July, 1960, and by his order dated 29th July, 1960, held that no part of the assessment for the year 1955-56 was barred and directed fresh assessment to be made. The Sales Tax Officer accordingly made fresh assessment on 24th September, 1960. The appellant challenged the revisional order passed by the Commissioner under section 20(3) and the subsequent fresh assessment order passed by the Sales Tax Officer on 24th September, 1960, on the ground that the appellate order of the Assistant Commissioner could not be revised by the Sales Tax Commissioner, in exercise of his power under section 20(3) as the Assistant Commissioner was the authority appointed to assist the Commissioner. Consequently, his order could not have been revised by the Commissioner. The learned single judge of the Delhi High Court allowed the writ petition, but the respondent, the Union of India, succeeded in the Letters Patent Appeal before a Division Bench of the Delhi High Court and consequently, the original petitionerappellant approached the Supreme Court in appeal by certificate granted by the Delhi High Court. In the aforesaid appeal, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e respondent from outside the State of Madras, on the ground that it was wrongly excluded in the computation of the turnover. The question was whether the said revisional proceeding could be legally maintained. It was held by the Supreme Court in that case that the question regarding the exclusion of the value of cotton purchased from outside the State of Madras was not raised before the Deputy Commissioner and the only point raised before him was regarding the inclusion of the amount of tax collected by the respondent in the taxable turnover. The subject-matter of the revision proceeding before the Board of Revenue was the revised assessment order of the Deputy Commercial Tax Officer dated 28th November, 1952, and that the doctrine of merger was not a doctrine of rigid and universal application and it could not be said that wherever there were two orders, one by an inferior tribunal and the other by a superior tribunal, passed in an appeal or revision, there was a fusion or merger of the two orders irrespective of the subject-matter of the appellate or revisional order and the scope of the appeal or revision contemplated by the particular statute. There the question was whether th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e matter beyond any controversy and show that the Deputy Commissioner sought to revise once again under the same section 67 the prior revisional order passed by the Assistant Commissioner under the same section for the same subject-matter. The prior revisional order was passed in the revisional proceedings taken up suo motu by the Assistant Commissioner against the order of the Sales Tax Officer pertaining to the tax liability for Samvat Year 2028. The question regarding the set-off was intricately connected with the question pertaining to the liability of the assessee under section 16 and the question of penal liability under section 45. Thus, it cannot be said that the impugned notice did not pertain to the same subject-matter. Under the circumstances, the aforesaid submission of Mr. Nanavati is liable to be rejected. In view of the aforesaid decision on the first submission of Mr. Kaji, it is not necessary to examine the merits of the second submission regarding the effect of the revisional order of the Sales Tax Tribunal and whether the order of the Assistant Commissioner had merged in the revisional order passed by the Sales Tax Tribunal. We express no opinion on this question ..... 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