TMI Blog1993 (1) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... e at Baroda. It manufactures medicines at Baroda and transfers the same to its various divisions in West Bengal for sale, namely, at Calcutta, Burdwan and Siliguri. The case of the applicants is that those three divisions operate independent of each other, only answerable to the head office at Baroda. The company has no head office or chief branch in West Bengal, each division being separate, autonomous and independent. The Calcutta division allegedly does not exercise any control over the Burdwan and Siliguri divisions. Separate and independent books of account are maintained in the said three divisions, while the head office at Baroda maintains separate division-wise trading and profit and loss accounts. The company was paying sales tax by consolidated periodical challans for all the three divisions in West Bengal. It was experiencing inconvenience in maintaining such consolidated accounts and for submitting consolidated sales tax returns. The various inconveniences are stated in paragraph 7 of the application. In February, 1985, the Burdwan and Siliguri divisions applied for separate registration as dealer before the appropriate Commercial Tax Officers with intimation to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... panies and whether any acknowledgement thereof was received. Time was prayed, also for establishing the fact that an application was pending before the appropriate Commercial Tax Officer of Calcutta for conversion of registration certificate in form II-B to one in form II-A. It is alleged that the Commercial Tax Officer, Siliguri, arbitrarily and unreasonably rejected the prayer for time and thus denied an opportunity of being heard to the applicants. By a memo dated May 22, 1985 the company was informed by the Commercial Tax Officer, Siliguri, that by an order of May 21, 1985, registration certificates issued in respect of Siliguri division on February 15, 1985, had been quashed. The said order dated May 21, 1985, is under challenge in this application. 4.. According to the applicants, in terms of the definition of "dealer" in section 2(b) of the Central Sales Tax Act, 1956, every branch will be deemed to be a dealer. It is also alleged that in terms of the definition of "dealer" in section 2(b) of the 1954 Act, the Siliguri division, like any other division in West Bengal, will be a dealer, because the medicines are imported from Baroda in the State of Gujarat for sale in West ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rant the certificate. The company could not take advantage of an infraction of law, though committed in its favour. The allegations of contravention of articles 14 and 19(1)(g) are denied. 6.. An affidavit-in-reply was filed by the applicants, reiterating the averments in the main application and denying the allegations in the affidavit-in-opposition. 7.. By the impugned letter No. 6272 dated May 22, 1985 the Commercial Tax Officer, Siliguri Charge, informed the company's Siliguri division that by an order dated 21, 1985, the certificates of registration as dealer granted to the Siliguri division on February 15, 1985 under the 1941 Act and 1954 Act had been quashed. It may be stated again that the question of validity of the said order with regard to the registration certificate dated February 15, 1985, under the Central Sales Tax Act, 1956, is not a subject-matter of this decision, since this Tribunal exercises no jurisdiction in matters directly arising out of the said Act of 1956. 8.. Mr. N.K. Kothari, learned advocate appearing for the applicants, did not press the contentions in the main application that the impugned order of quashing the registration certificates in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing and cancellation and said that where the notice was for cancellation, quashing was invalid. Before we deal with the above points regarding authority, jurisdiction and notice, it is necessary to dispose of another point which Mr. Kothari argued but could not substantiate with materials. He contended that after separate registration certificates were granted for Siliguri division, the turnover of Calcutta division fell, thereby reducing the tax amount assessable on the Calcutta division. Therefore, the Assessment Wing of the Central Section of the Commercial Taxes Directorate was putting pressure on the Commercial Tax Officer, Siliguri. Even higher officials of the Directorate were commenting that separate registration certificates had been improperly issued. As far as this contention is concerned, no material was produced to show that the Commercial Tax Officer of Siliguri charge was influenced by any opinion of the Assessment Wing in charge of assessment of the Calcutta division of the company or by any officer superior to the concerned Commercial Tax Officer. In such a situation, the contention falls through. The burden of proof is squarely on the applicants to show that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bengal General Clauses Act, 1899 which lays down that a power to issue orders, rules, bye-laws or notifications includes a power to amend, vary, rescind any order, etc., so issued. But when it is contended that section 20(4) is the specific provision which conferred jurisdiction and authority on the officer to review an earlier order, it is not necessary to take recourse to section 22 of the Bengal General Clauses Act. Mr. Kothari appearing for the applicants did not argue on the question whether the Commercial Tax Officer received jurisdiction from section 20(4) to review his own order so as to cancel it, if necessary. He concentrated on the only point that the impugned order should stand or fall in terms of section 7(6)(b), since it purported to be under that provision only and his case is that the order is unsustainable under section 7(6)(b). Thus, the contention of the learned State Representative went unopposed in regard to derivation of power to quash/cancel the order under the 1941 Act from section 20(4). The Revenue agreed that the order could not be sustained under section 7(6)(b). We are also of the same opinion. Therefore the remaining question is whether the order is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sales Tax Act, 1947, but he made it under section 12(4). It was held that since the officer had the power to assess and there was no inherent lack of jurisdiction, it was immaterial under which provision he made the order. 13.. The same arguments were advanced by Mr. Kothari, appearing for the applicants, in respect of the impugned order dated May 21, 1985, quashing the registration certificate dated February 15, 1985, under the West Bengal Sales Tax Act, 1954. The learned State Representative opposed those contentions, relying on the same decisions. He further submitted that the Commercial Tax Officer was vested with jurisdiction both under section 5(4)(b) of the 1954 Act read with rule 13 of the West Bengal Sales Tax Rules, 1954, and under section 12(2) of the 1954 Act for cancellation, modification and amendment of the certificate. Section 12(2) reads as follows: "Subject to such rules, as may be prescribed, any assessment made, tax determined, or order passed under this Act or the Rules made thereunder may be reviewed within forty-eight months by the person or the Tribunal passing it upon application or of his or its own motion: Provided that-......." Section 5(4)(b) is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red together, it will appear that there was no prohibition against separate registration of a branch or division of a company as a dealer. He said that rather the intention was that each branch or division should be so registered separately. Mr. Kothari urged this point in order to show that the impugned quashing orders were unwarranted because separate registrations had been validly given. He particularly relied on the definition of "dealer" in section 2(b) of the Central Sales Tax Act, 1956, and more particularly on the explanation thereto. The provision is extracted below for proper appreciation "'dealer' means any person who carries on (whether regularly or otherwise) the business of buying, selling, supplying or distributing goods, directly or indirectly, for cash, or for deferred payment, or for commission, remuneration or other valuable consideration, and includes- (i) to (iii)............ Explanation 1.-Every person who acts as an agent, in any State, of a dealer residing outside that State and buys, sells, supplies or distributes goods in the State or acts on behalf of such dealer as- (i) to (iii)........... and every local branch or office in a State of a firm reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 954 Act runs as follows: "'dealer' means any person who sells notified commodities manufactured, made or processed by him in West Bengal, or brought by him into West Bengal from any place outside West Bengal for the purpose of sale in West Bengal and includes the Central or a State Government, a local authority, a statutory body, a trust or other body corporate, a liquidator or a receiver appointed by a court in respect of a person defined under this clause as a dealer; Explanation.-Where notified commodities are brought into West Bengal from any place outside it, the person who takes delivery or on whose behalf delivery is taken shall be deemed to have brought them into West Bengal." 18.. When under section 2(c) of the 1941 Act a dealer should be a person or a body corporate, it is difficult to conceive how a branch or a division of an incorporated company can become a dealer. The word "person" has not been defined in the 1941 Act. It has been defined in section 3(32) of the Bengal General Clauses Act, 1899, as including any company or organisation or body of individuals, whether incorporated or not. The applicant No. 1 is an incorporated company. Sections 7 and 8 of the 194 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e argued that it has neither any statutory force, nor any relevance to the provision of law regarding registration of a dealer at the relevant time. Mr. Kothari submitted to us that the Calcutta branch or office of the applicantcompany was started in 1965 and the second branch at Siliguri was started in 1966 but in February, 1985 the Siliguri branch/division applied for separate registration. The press note of 1958, lost its relevance to a proceeding for registration in the year 1985. The definition of "dealer" underwent amendments. Similarly, the relevant rules regarding registration had also been changed from time to time. But, more importantly, we think that the press note has no statutory force and cannot override the provisions of law contained in section 2(c) as it stood in 1985 and the rules regarding registration framed under the Bengal Finance (Sales Tax) Act, 1941. Mr. De rightly drew our attention to the amendments dated March 31, 1949 and November 6, 1950 of the definition of "dealer" in section 2(c). The press note might be relevant to the old definition, but, in any case, not to the definition in force in the year 1985. Mr. Kothari presented to us some papers showing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is meant for a dealer having more than one place of business in West Bengal, did not apply to the applicant. His contention was similar with regard to application forms Nos. IA and IB under the West Bengal Sales Tax Rules. 1954, framed under the 1954 Act. It may be mentioned at this stage that Mr. Kothari produced a copy of resolution No. 9 dated September 2, 1968, adopted by the Board of Directors of the applicant-company, Alembic Chemical Works Company Limited and contended that the resolution purports to show that the Siliguri division was treated as a separate entity. The resolution was, however, merely to the effect that the Manager of Siliguri division was being given a power of attorney on behalf of the company. In any case, a company is a single person in the eye of law and cannot reconstitute itself to several persons, namely, several legal entities. Mr. De, the learned State Representative, drew our attention to the company's letter dated July 29, 1968, designating its Calcutta office as the principal place of business and to a subsequent letter dated July 4, 1984, asking for amendment of the registration certificate by including the company's warehouse at Siliguri. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h/division in West Bengal as its head office, vide form IB, that form cannot apply to it and therefore the other form, namely, the form IA should apply. We are unable to agree. Form IA is clear on the point that it is applicable to a dealer with only one place of business in West Bengal. Form IB is clear that it applies to a dealer having more than one place of business in West Bengal. As regards designation of any branch/division as head office, the learned State Representative has established that the company had declared its Calcutta office or branch as the principal place of business, namely, head office for the purpose of West Bengal. That situation continued until February, 1985 when the Siliguri division applied for a separate registration. So, as a point of fact, the Calcutta office has been declared as the head office or principal place of business. Assuming that the company has not declared any branch/office as head office or principal place of business, the intention of rule 5 and forms IA and IB under the 1941 Rules or of the similar forms under the 1954 Rules cannot be frustrated by a company by simply abstaining from declaring a particular branch/office as the head of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that in the application for registration particulars of registration certificate issued by the Registrar of Joint Stock Companies of West Bengal or outside West Bengal should be mentioned. 21.. Thus, having regard to the relevant rules of 1954 and forms IA and IB under the 1954 Rules, we are of the same opinion that the applicant-company was required to declare one of its branches or divisions as the chief branch or head office for the purpose of registration. Rule 1(2)(aa) of the 1941 Rules also defines the appropriate Commercial Tax Officer. In doing so, it also says that in case of a dealer having more than one place in Bengal, the Commercial Tax Officer having jurisdiction over the chief branch or head office in Bengal. shall be the appropriate Commercial Tax Officer for such a dealer. 22.. Accordingly, we are of the opinion that form IB under both the Rules, namely, Rules of 1941 and 1954, is the appropriate form for application by the applicant-company for registration as a dealer whether under the 1941 Act or under the 1954 Act. For using form No. IB, the applicant-company was under an obligation to declare one of its branches/divisions as the chief branch or head of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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