9911796707
TMI Blog2014 (4) TMI 1329X X X X Extracts X X X X X X X X Extracts X X X X ..... ion scheme was awaited, the petitioner started paying tax on adhoc basis as per the composition scheme w.e.f. 01.02.1995. Thereafter, on 9th of March 1995, the petitioner sent a reminder to first respondent for passing requisite orders under the composition scheme. In the interregnum, an amendment was made in the composition scheme vide Notification No.F-10(31)FD/GR.IV/87 dated 23rd of February 1995 and the gist of which was circulated by the Commissioner, Commercial Taxes vide its letter dated 14th of March 1995. As no specific order for composition scheme was made uptil issuance of the amendment notification dated 23rd of February 1995, the petitioner harboured the impression that composition scheme as amended by Notification dated 23rd of February 1995 would govern his case. However, to petitioner's dismay the first respondent passed an order subject to approval of the Commissioner, Commercial Taxes on 5th of April 1995 ordering composition for the period 01.02.1995 to 31st of January 1996 at a sum of Rs.29,830 in accordance with the old unamended scheme and not in accordance with the Notification dated 23rd of February 1995. In adherence of the order, the requisite amount w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copy of the judgment of the Tribunal and submitted that petitioner became entitled for refund in a different context. In the writ petition, the petitioner has also made endeavour to challenge the validity of Section 9A of the Act by urging that State cannot be allowed to take interest and deny the same on the refund due to the assessee. Once again reiterating that the copy was not endorsed to the petitioner while rejecting the application for rectification of mistake, the petitioner has pleaded that its entitlement to consequential relief in the composition amount fixed in terms of Notification dated 23rd of February 1995 wherein tax payable compounded for the first year money amount of composition was envisaged 25% but subsequently by amendment notification it was altered as 10% over the average collection of past three years. With this submission, the petitioner has prayed for modification of orders Annex.8 & 18 and for quashing order dated 11th September 1996 (Annex.13) and order dated 22nd of December 1998 (Annex.14) respectively. At the threshold, the petitioner approached the Rajasthan Taxation Tribunal by laying Original Application but after repealing of the Rajasthan Taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification of mistake, it is averred in the reply that as the composition order was just and proper, the said application was rightly turned down without affording opportunity of hearing to the petitioner. After submission of reply on behalf of the petitioner, rejoinder is submitted wherein the contents averred in the petition were reiterated. In the rejoinder, the petitioner has specifically pleaded that although the period of composition was from 01.02.1995 i.e. before amendment of the Scheme, but the composition order itself was made on 05.04.1995 when the amended composition scheme was in vogue, it was desirable from the competent authority to pass composition order in terms of the amendment notification dated 23rd of February 1995. In alternative, the petitioner has also pleaded that the period anterior to the amendment notification i.e. 01.02.1995 to 23rd February 1995 can be occupied by the old composition scheme but from 23rd February onwards the department as well as Cinema Hall were obliged to apply and adhere to the amendment in the Scheme for the period starting from April to March (financial year). With these submissions, the petitioner has urged with full emphasis tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the judgment of Hon'ble Apex Court in case of Federation of A.P. Chambers of Commerce & Industry Vs. State of Andhra Pradesh [(2000) 6 SCC 550]. In this verdict, speaking for the Court, Justice Bharucha, while construing Section 3 of the A.P. Non-agricultural Lands Assessment Act 1963, has held as under: 6. Section 3 of the said Act speaks of "land is used for any industrial purpose", "land is used for any commercial purpose" and "land is used for any other non-agricultural purpose". The emphasis is on the words "is used". For the purposes of levy of assessment on non-agricultural lands at the rate specified in the Schedule for land used for industrial purposes, therefore, there has to be a finding as a fact that the land is in fact in praesenti in use for an industrial purpose. The same would apply to a commercial purpose or any other non-agricultural purpose. 7. It is trite law that a taxing statute has to be strictly construed and nothing can be read into it. In the classic passage from Cape Brandy Syandicate which was noticed in the judgment under appeal, it was said : "In a taxing Act one has to look merely at what is clearly said. There is no room for any intendm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r conferred on the competent authority under Rule 32 of the Rules of 1957, learned counsel submits that the authority can rectify the mistake which is apparent on the face of record and the jurisdiction therefore is not akin to that of correcting clerical mistake only. Submission of Mr. Kothari is that rectification sought for was for the mistake which was apparent on the face of record and therefore it was expected of the competent authority to have examined the same objectively. Mr. Kothari further submits that denial of reasonable opportunity of hearing by the authority to the petitioner has prejudiced the cause of the petitioner assessee. Learned counsel submits that the order rejecting the request of the petitioner for rectification of mistake has visited it with evil and civil consequences and therefore it was necessary for the competent authority to have adhered to principles of natural justice while passing adverse order against the petitioner. In support of his contentions, learned counsel for the petitioner has placed reliance on the following judgments: 1. Mrs. Maneka Gandhi Vs. Union of India & Anr. [(1978) 1 SCC 248] 2. Babloo Pasi Vs. State of Jharkhand (AIR 2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escribed in many authorities. But any analysis must bring into relief rather their spirit and their inspiration than any precision of definition or precision as to application. We do not search for prescriptions which will lay down exactly what must, in various divergent situations, be done. The principles and procedures are to be applied which, in any particular situation or set of circumstances, are right and just and fair. Natural justice, it has been said, is only 'fair play in action'. Nor do we wait for directions from Parliament. The common law has abundant riches: there may we find what Byles, J., called 'the justice of the common law' ". Thus, the soul of natural justice is "fair- play in action" and that is why it has received the widest recognition throughout the democratic world. In the United States, the right to an administrative hearing is regarded as essential requirement of fundamental fairness. And in England too it has been held that "fair-play in action" demands that before any prejudicial or adverse action is taken against a person, he must be given an opportunity to be heard. The rule was stated by Lord Denning, MR in these terms in Schmidt v. Secretar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inquiry may have far more serious consequences than a decision in a quasi-judicial inquiry and hence the rules of natural justice must apply equally in an administrative inquiry which entails civil consequences. There was, however, a time in the early stages of the development of the doctrine of natural justice when the view prevailed that the rules of natural justice have application only to a quasi-judicial proceeding as distinguished from an administrative proceeding and the distinguishing feature of a quasi-judicial proceeding is that the authority concerned is required by the law under which it is functioning to act judicially. This requirement of a duty to act judicially in order to invest the function with a quasi-judicial character was spelt out from the following observation of Atkin, L.J. in Rex v. Electricity Commissioners, "wherever anybody of persons having legal authority to determine questions affecting the rights of subjects, and having the duty to act judicially, act in excess of their legal authority, they are subject to the controlling jurisdiction of the King Bench Division . . .". Lord Hewart, C.J., in Rex v. Legislative Committee of the Church Assembly read t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law, that in recent years the concept of quasi-judicial power has been undergoing radical change and said: "The dividing line between an administrative power and a quasi-judicial power is quite thin and is being gradually obliterated. For determining whether a power is an administrative power or a quasi-judicial power one has to look to the nature of the power conferred, the person or persons on whom it is conferred, the framework of the law conferring that power, the consequences ensuing from the exercise of that power and the manner in which that power is expected to be exercised." The net effect of these and other decisions was that the duty to act judicially need not be super-added, but it may be spelt out from the nature of the power conferred, the manner of exercising it and its impact on the rights of the person affected and where it is found to exist, the rules of natural justice would be attracted. In Babloo Pasi's case (supra), Hon'ble Apex Court while examining Sections 49 and 53 of the Juvenile Justice (Care & Protection of Children) Act 2000, held that conclusion of the Juvenile Board that accused is above 18 years of age, without notice to the accused is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be applied qua it and as such the competent authority has not committed any error much less an error apparent on the face of record warranting interference by this Court. Learned counsel Mr. Godara has argued that the application for rectification of alleged mistake submitted by the petitioner in accordance with amending notification which envisage increase of only 10% over the average collection of past three years is against the increase of 25% applied in the present case in accordance with the old scheme was decided after issuing show cause notice to the petitioner containing appropriate reasons. With these submissions, Mr. Godara has argued that the contention of the petitioner about violation of principles of natural justice vis-à-vis order dated 28th of August 1997 is not at all tenable. Learned counsel for the Revenue has also urged that virtually the petition has gone infructuous because now the controversy regarding validity of Section 9-A of the Act of 1957 is no more res- integra and therefore nothing survives for adjudication in the writ petition. Mr. Godara has submitted that the petitioner has misled this Court that by stating that it has not been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated as a constitutional imperative or as a statutory requirement, it is neither an absolute right nor an unconditional obligation but is subject to the above requirement, as explained in the body of the judgment. Where the burden of the duty has been passed on, the claimant cannot say that he has suffered any real loss or prejudice. The real loss or prejudice is suffered in such a case by the person who has ultimately borne the burden and it is only that person who can legitimately claim its refund. But where such person does not come forward or where it is not possible to refund the amount to him for one or the other reason, it is just and appropriate that that amount is retained by the State, i.e., by the people. There is no immorality or impropriety involved in such a proposition. The doctrine of unjust enrichment is a just and salutary doctrine. No person can seek to collect the duty from both ends. In other words, he cannot collect the duty from his purchaser at one end and also collect the same duty from the State on the ground that it has been collected from him contrary to law. The power of the Court is not meant to be exercised for unjustly enriching a person. The doctr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notification dated 14th of March 1995 Para 4 of the Scheme was amended w.e.f. 23rd of February 1995 and composition of entertainment tax for the first year was reduced from 25% to 10% Para 1 of the Notification dated 14.03.1995 showing aforesaid amendment is reproduced as under: (1) संशोधित अनुच्छेद 4 के अनुसार प्रश्मन राशि का निर्धारण गत तीन वर्षों की औसत दर्शक संख्या को प्रचलित प्रवेश दर से गुणा करने पर प्राप्त राशि में 10 प्रतिशत की वृê ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whereby prayer of the petitioner for rectification of mistake was declined. The petitioner has precisely assailed the same on the anvil that it is violative of principles of natural justice. I have considered the legal precedents relied upon by the learned counsel for the petitioner in the backdrop of facts of the instant case. Well it is true that Rule 32 of the Act of 1957 has not laid down the prescribed procedure for dealing the application for rectification of mistake and sub-rule (3) simply envisage giving notice to the proprietor in the event of enhancing an assessment order, reducing a refund or otherwise increasing the liability of the proprietor. However, on properly construing the amended scheme which was in vogue after 23rd of February 1995, specially qua the petitioner for composition of entertainment tax in terms of unamended Scheme of 08.07.1982 make it amply clear that it has jettisoned the right of the petitioner i.e. eventual aversion to its valuable right for being governed by the amended Scheme for composition of entertainment tax. Therefore, requisite order on application for rectification of mistake ought to have satisfied the requirement of audi alterm part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be, under the authority of law. Both the enactments are self-contained enactments providing for levy, assessment, recovery and refund of duties imposed thereunder. Section 11-B of the Central Excises and Salt Act and Section 27 of the Customs Act, both before and after the 1991 (Amendment) Act are constitutionally valid and have to be followed and given effect to. Section 72 of the Contract Act has no application to such a claim of refund and cannot form a basis for maintaining a suit or a writ petition. All refund claims except those mentioned under Proposition (ii) below have to be and must be filed and adjudicated under the provisions of the Central Excises and Salt Act or the Customs Act, as the case may be. It is necessary to emphasis in this behalf that Act provides a complete mechanism for correcting any errors whether of fact or law and that not only an appeal is provided to a Tribunal - which is not a departmental organ - but to this Court, which is a civil court. The power to claim refund is circumscribed on the strength of doctrine of unjust enrichment. From the facts pleaded by the rival parties and the materials placed on record, it is not at all clear as to whether ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
