TMI Blog1995 (6) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... , to issue registration certificates to the petitioner under the Act and the Central Act, etc. The petitioner made the applications dated August 13, 1994, for the registration certificates to the first respondent. He sent them by registered post and they have been received by the first respondent on August 16, 1994. The first respondent issued notice No. 2/94-95 dated August 17, 1994, directing the petitioner to furnish certain information within seven days and that notice was received by the petitioner on September 8, 1994. The petitioner replied by a letter dated September 12, 1994, which was received by the first respondent on September 13, 1994. The first respondent issued another notice No. 2/94-95 dated September 13, 1994, which was served on the petitioner on October 25, 1994. Thereafter, the petitioner addressed a letter dated October 31, 1994 to the first respondent along with certain enclosures and the same was received by the first respondent on November 1, 1994. The petitioner once again addressed a letter dated February 16, 1995 and personally delivered the same. Thereafter, the petitioner was served another notice No. 2/94-95 dated February 16, 1995 and the same was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documentary evidence in the shape of municipal tax receipt issued by the M.C.H. is also enclosed herewith showing the ownership of the landlord against mulgi No. 15-2-675, Kishangunj. This is sufficient evidence to prove the ownership of the building." The petitioner submits that after he gave his reply dated September 12, 1994, which he personally submitted in the office of the first respondent on September 13, 1994, he did not receive any notice or communication from the respondents and therefore he must be deemed to have been duly registered by virtue of rule 28(10)(c) of the Rules. He states that he filed his application for registration on August 16, 1994, to which the first respondent issued notice calling for certain information; that he furnished the required information on September 13, 1994 and therefore September 13, 1994, should be taken as the date of filing of the application for the purpose of rule 28(10)(c); and that as he did not receive any further notice or information from the first respondent within 30 days from September 13, 1994, he must be deemed to have been duly registered from October 13, 1994, i.e., after the completion of 30 days from September 13, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to carry on his business peacefully by issuing a registration certificate. The first respondent filed counter-affidavit dated February 28, 1995 and also produced the relevant record. In his counter-affidavit, the first respondent submits as follows: "It is submitted that the application for registration is done in two forms, viz., form 'A' and form 'D' under the APGST Rules, 1957. Form 'A' relates to estimated turnover of the dealer. This estimation is taken for the purpose of calculating security that would be required from the dealer. Form 'D' provides for the information about the nature of business, composition of the dealer, i.e., whether it is proprietary concern, firm or limited company and other such information. The said form also provides for identification from two registered dealers. It is the general practice that when application for registration is received, first form'A' will be checked and after ensuring that it is properly filled in, the check of all other details in form 'D' will be taken up. Upon receipt of the application from the petitioner, form 'A' was checked and it was found that it was improperly filled. This was informed to the petitioner by notice da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he requirements of the APGST Act and he cannot complain of harassment in this regard. It is humbly submitted that the petitioner has not furnished security as required from him till date and it is open to him even today to furnish the required security and comply with the requirements of the APGST Act." The question then is whether the petitioner is right in proceeding on the basis that he shall be deemed to have been registered under rule 28(10)(c) of the Rules, which provides that "if the certificate of registration is not received by the applicant within 30 days from the date of submission of his application or if no notice is received by him within the period of 30 days from the date of submission of the application, the applicant shall be deemed to have been registered". The first respondent submits that he issued notice dated August 17, 1994, which was admittedly received by the petitioner on September 8, 1994, i.e., well within 30 days from the date of submission of the application by the petitioner, i.e., on August 16, 1994. The first respondent contends that as the notice was received by the petitioner within 30 days, he cannot be deemed to have been duly registered. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... security under subsection (7) unless he has been given an opportunity of being heard and the amount of such security or additional security that may be required to be furnished shall not exceed the amount equal to tax payable under the Act, in accordance with the estimate of such authority, on the turnover of such dealer for the year in which such security is required to be furnished. Sub-section (8) of section 12 is crucial and it provides as follows: "(8) If the authority to whom an application is made under sub-section (6) is satisfied that the application is bona fide and is in order and in conformity with the provisions of this Act and the rules made thereunder and the conditions, if any, imposed under sub-section (7) has been complied with, he shall register the applicant and grant him a certificate of registration in the prescribed form." A careful reading of this provision shows that the requirements to be satisfied for the registration and for grant of certificate of registration are: firstly-that the application is bona fide; secondly-that it is in order and in conformity with the Act and the Rules; and, thirdly-security, if any, specified by an order duly made under su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertificate shall be issued within thirty days from the date of receipt of application. (b) If for any reason, the certificate of registration cannot be issued within the period specified above, the registering authority shall give the applicant a notice of further enquiry or a notice to show cause against rejection of the application within a period of thirty days from the date of receipt of application. (c) If the certificate of registration is not received by the applicant within thirty days from the date of submission of his application or if no notice is received by him within the period of thirty days from the date of submission of application, the applicant shall be deemed to have been duly registered. (d) Where the said authority is satisfied that the application is not bona fide and the particulars contained therein are not correct and complete, where the fees referred to in sub-rule (7) has not been paid and/or the security if any, demanded has not been furnished, he may reject the application for reasons to be recorded in writing after giving an opportunity of making a representation against the rejection and as the case may be, of correcting and completing the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C 1471 has observed that the purpose and object of that Act is to levy and collect tax for purposes of the general revenues of the State and that the liability for payment is placed under section 3 of that Act upon the person effecting the sale. As regards the requirement of registration of dealers under that Act the Bench observed as follows: "........In order therefore that the State may have a check on the person from whom the tax is due, section 4(1) provides for registration of dealers who carry on the business in motor spirit. Without such registration it would be impossible for the State to know the persons who are selling motor spirit and from whom the tax is due. The provision therefore under section 4(1) for registration of dealers is an eminently reasonable provision in order to carry out the object of the Act, namely, the levy and collection of this tax for purposes of the State. It is really no restriction on carrying on business in motor spirit; any one who carries on such business is free to do so and all that he has to do is to ask for registration, which he will get subject to the provisions of sub-section (4). That sub-section has not been challenged in these pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n provided in the Act and rules yet the application should be disposed of within reasonable time." In Sewa Singh Sadhu Singh v. State of Haryana [1981] 48 STC 117 a Division Bench of the Punjab and Haryana High Court was inclined to agree with the assessee that the inaction on the part of the Assessing Authority in taking a decision on assessee's application for registration under the Punjab General Sales Tax Act, 1948, would confer the status of a registered dealer on the assessee. What follows is that the registering authority will have to take up for consideration an application for registration immediately on receiving it and has to make the necessary enquiry with expedition. As pointed out by a Division Bench of this Court in Samayamanthula Srihari v. Commercial Tax Officer [1993] 88 STC 446 "the enquiry that is contemplated under rule 28 is intended to enable the registering authority to find out whether the application submitted for registration is bona fide or not and whether the particulars mentioned therein are correct or not". If he is satisfied that it is bona fide and that the particulars mentioned are correct, he has to issue registration certificate within 30 day ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication. This has to be read in conjunction with what is provided in clause (c) of subrule (10), i.e., that "if no notice is received by him within the period of 30 days from the date of submission of the application, the applicant shall be deemed to have been duly registered". We are clearly of the view that the notice referred to in clause (c) is the one or the other notice mentioned in clause (b) of subrule (10), i.e., a notice of further enquiry or a notice to show cause against the rejection of the application. Reading clauses (b) and (c) together, the registering authority should take care to see that either of those two notices are received by the applicant within 30 days from the date of submission of his application if he is not to be deemed to have been duly registered. We are supported in this view by the observations of a Division Bench of this Court, of which one of us-Syed Shah Mohammed Quadri, J.-is a member, in Santhosh Wines v. Asst. Commercial Tax Officer [1995] 99 STC 160 supra. In that case, the Bench considered the scope and ambit of rule 28 of the Rules and observed as follows: ".......Clause (a) of sub-rule (10) of rule 28 directs that if the registering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the petitioner on August 16, 1994. Though it was dated August 17, 1994, as pointed by us earlier, it was actually despatched on September 6, 1994 and was in fact received by the petitioner on September 8, 1994. No explanation whatsoever has been given by the first respondent herein in his counter-affidavit as to why 21 days were taken in initiating enquiry under clause (a) of sub-rule (10) when that clause mandates that such enquiry should be concluded within 30 days so as to enable the first respondent to either issue certificate of registration to the petitioner or to issue notices contemplated under clause (b) of sub-rule (10), i.e., of further enquiry or to show cause against the rejection of the application within a period of 30 days from the date of receipt of the application, i.e., by September 15, 1994. A reading of the notice dated August 17, 1994, shows that it nowhere mentions anything about any enquiry. It does not fix any date for the appearance of the petitioner before the authority concerned, i.e., first respondent herein. It only requires the petitioner to furnish certain information, and, that too, "within seven days from the date of receipt of that notice". It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice dated August 17, 1994, as per his own averments in his counter-affidavit. The stand of the first respondent that the application for registration is done in two forms, i.e., form A and form D, does not bear scrutiny. As per sub-rule (6) of rule 28 "every application for registration under sub-rules (1) to (5) shall be made in form D". The heading of form D also is "Application for registration as a dealer under section 12 of the Andhra Pradesh General Sales Tax Act, 1957". This is the only form of application prescribed under the Rules. Form A does not form part of form D application. Form A has to be submitted under rule 9 of the Rules, which is as follows: "Every dealer liable to get himself registered under section 12 of the Act commencing business after 15th June, 1957 shall within 30 days of the commencement of business submit to the assessing authority of the area in which his principal place of business is situated, a return in form A showing his estimated total and net turnover for the first twelve months of his business." A reading of rule 9 shows that return in form A has to be submitted "within 30 days of the commencement of business ". Sub-section (5) of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red by the first respondent by September 13, 1994. In the notice dated September 13, 1994, issued by the first respondent no reference was made to his earlier notice dated August 17, 1994, which was received by the petitioner on September 8, 1994; nor was any reference made to the reply dated September 12, 1994, given by the petitioner along with certain enclosures. This notice was actually served on the petitioner only on October 25, 1994. The explanation given by the first respondent in his counter-affidavit for the inordinate delay of six weeks in serving this notice on the petitioner does not stick and there is no satisfactory explanation for this lapse. On the other hand, the delay seems to be deliberate. The first respondent casts a Nelson's eye on the mandatory requirement of rule 28(10) that the enquiry on form D application for registration should be concluded as far as possible within 30 days and if that is not possible notice of further enquiry should be issued within that time. We are of the view that even if a notice of further enquiry is issued, the registering authority should conduct the further enquiry also with utmost despatch. Sub-rule (10) of rule 28 cannot be i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registering authority adopting the ruse of issuing only a notice and doing nothing else within the prescribed period of 30 days. A flimsy notice within 30 days raising insubstantial objections or frivolous queries cannot deprive the applicant of the deemed registration under clause (c) of rule 28(10). In the present case we find that the first respondent has not done anything within the prescribed period of 30 days except giving notice dated August 17, 1994, giving 7 days time to the petitioner for submitting some information; that notice was despatched only on September 6, 1994 and was received by the petitioner on September 8, 1994. We have already found that this notice is not the one contemplated by clauses (b) and (c) of rule 28(10). One objection raised in that notice was that column No. g(i) "was not filled up with the details as required". We have gone through forms "D" and "A" under the Rules and form "A" for registration under the Central Sales Tax Act, 1956 and other forms filed by the petitioner which are in the record produced before us. We did not find any column No. g(i) in any of those forms. The other things required to be produced by the petitioner could have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uiry revealed that the petitioner was the son of the proprietor of M/s. Paddagari Ramaiah and Company. But a son cannot be denied registration under the Act and prevented from doing business because the father is in arrears of sales tax. In fact the record discloses that the petitioner's brother P. Rama Krishna has been registered as dealer under the Act under Certificate of Registration No. HYR/04/1/3867/92-93. A xerox copy of certificate of registration issued to P. Rama Krishna is found in the records produced before this Court by the first respondent. In State of Andhra Pradesh v. Indian Medicine Sales House [1989] 75 STC 353 a Division Bench of this Court observed as follows: ".........No doubt husband and wife are members of a Hindu undivided family under the Hindu law. But Sales Tax Act permits each of them registering separately as dealers. There is also no provision, like the one under section 64 of the Income-tax Act, 1961, to club the turnovers of wife and husband for purposes of assessment." In that case the husband was owning a manufacturing concern and the wife was owning a trading concern and both were registered separately as dealers under the Act. A member of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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