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1997 DIGILAW 17 (PAT)

Consultants( India) Ltd. v. State Of Bihar

1997-01-10

D.P.WADHWA, S.K.CHATTOPADHYAYA

body1997
Judgment D. P. Wadhawa, C J, S. K. Chattopadhaya, J. 1. In this petition under articles 226 and 227 of the Constitution, the petitioner, a Government of india undertaking seeks writ/order or direction quashing the two assessment orders both dated 23-11-1996 passed by respondent No.4, Deputy Commissioner of Commercial Taxes, one under the provision of the Central Sales lax act and the other under the State law, i. e. the Bihar Finance Act, 1981 . The assessment orders pertain to the year 1988-89. It is contended that the claim of the petitioner for exempted sale put forward under Sec.5 (2) and Section 6 (2) of the Central Sales lax Act, 1956 had been wrongly disallowed/rejected by the Assessing Authority. The petitioner then seeks to have the demand notices in pursuance to these assessment orders quashed as well. Further prayer is for a direction to the Assessing Authority "to issue summons upon the representatives of the petitioners clients under Section 10 of the Bihar Finance Act, 1981 for their examination on oath or affirmation and production of relevant documents required by respondent No.4 for the purpose of consideration of petitioner s above claims of exemption" 2. It could not be disputed that the impugned orders are appealable under section 45 of the Bihar Finance Act, 1981 and that the revision is also maintainable to the Commissioner of the commercial Taxes under sub-section (4)of Sec.46 of that Act. It was submitted by Mr. Poddar, Counsel for the petitioner that in order to avail the remedy of appeal the petitioner has to deposit 20% of the demand so raised which under the two assessment orders aforesaid amounted to Rs.82,58,585 and Rs.42,58,531. He said that the petitioner had got liquidity problem and the fund to make the deposit 20% of the demand was not readily available and further that the petitioner was running its establishment after taking loans from the Bank. It was also submitted that in view of the various decisions of the supreme Court the petitioner could not be asked to avail the alternative remedy of appeal or revision or even otherwise the petitioner would not be able to avail the remedy of appeal which right the statute grants. It was also submitted that in view of the various decisions of the supreme Court the petitioner could not be asked to avail the alternative remedy of appeal or revision or even otherwise the petitioner would not be able to avail the remedy of appeal which right the statute grants. It was then submitted that the question of law had been raised and that was that the Assessing authority did not take any action under section 10 of the Bihar Finance Act which clothed the Assessing Authority with the power of a civil court for summoning any witness and for production of documents. If the Assessing authority has not exercised any such power. this ground can also be agitated before the appellate authority. It will be for the appellate authority to see if a request under Sec.10 of the Act has been made before the Assessing authority and was that justified in the circumstances of the case. The amount of tax demanded in the first flush would seem to be quite enormous, but then as to what is the status as regards financial assets of the petitioner we would not know. In any case, if we accept the submission of the petitioner that an appeal would not be an appropriate remedy on account of its inability to deposit 20% of the tax demanded, the petitioner on its own showing can certainly file a revision before the Commissioner of commercial Taxes. Sub-section (4) of section 46 of the Bihar Finance Act is as under: " (4) The Commissioner may, on his own motion call for and examine the records of any proceeding in which any order has been passed by any other authority appointed under Sec.9, for the purpose of satisfying himself as to the legality or propriety of such order and may, after examining the record and making or causing to be made such enquiry as he may deem necessary, pass such order as he thinks proper. Mr. Poddar says that in case we give time to the petitioner to file revision before the Commissioner within 15 days and ask the Commissioner to decide the matter within 15 days thereafter, he would certainly file a revision. Mr. Poddar says that in case we give time to the petitioner to file revision before the Commissioner within 15 days and ask the Commissioner to decide the matter within 15 days thereafter, he would certainly file a revision. We are afraid we will not issue any such direction as we do not think It would be proper for us to do so without knowing as to how many matters are pending before the Commissioner of commercial Taxes and whether it will be feasible for him to decide the matter within 15 days. 3. We may also note that earlier the petitioner had filed a writ application in this Court, being C. WJ. C. No.732 of 1996 (R) challenging notices under Sec.20 (1) of the Bihar finance Act. These notices had been issued in respect of the assessment years 1988-89 to 1994-95. Sec.20 of the act is as under: "20. Escaped turnover detected before assessment - (1) If the prescribed authority in the course of any proceeding or otherwise under this part Is satisfied that any registered dealer - (a) has concealed any sales or purchases or any particulars thereof, with a view to reduce the amount of tax payable by him under this part or (b) has furnished incorrect statement of his turnover or incorrect particulars of his sales or purchases in the return furnished under sub-section (1) of Section 16 or otherwise, the prescribed authority shall, after giving such a dealer an opportunity to being heard in the manner prescribed, by an order in writing direct that he shall in addition to any tax which is or may be assessed under Sec.17, pay by way of penalty, in a case falling In clause (a), sum not exceeding three times but not less than an amount equal to the amount of tax and in a case falling In Clause (b), a sum not exceeding two times but not less than an amount equal to the amount of tax on the suppressed turnover or on -concealed or Incorrect particulars. (2) The penalty under sub-section (1)may be imposed before completion of assessment and for determining the amount of penalty, the prescribed authority may quantify the amount of tax provisionally in the prescribed manner. (3) Any penalty Imposed under subsection (1) shall be without any prejudice to any action which is or may be taken under Sec.49. " 4. (2) The penalty under sub-section (1)may be imposed before completion of assessment and for determining the amount of penalty, the prescribed authority may quantify the amount of tax provisionally in the prescribed manner. (3) Any penalty Imposed under subsection (1) shall be without any prejudice to any action which is or may be taken under Sec.49. " 4. It would be seen, one of the years in question was 1988-89 with which we are presently concerned in this proceedings. It was submitted by the revenue that in respect of these years certain exemptions had been claimed by the petitioner under Sec.5 (2) of the central Sales Tax Act which were not correct and the turnover was to be assessed under the Bihar Finance Act. The Court noticed that the petitioner had filed its return for the year 1988-89 onwards but the assessment proceedings in respect of those years were pending and that ultimately much would depend upon the particulars furnished by the petitioner in its return and on that basis it would be possible to hold whether the petitioner had or had not furnished incorrect particulars. The Court in that case passed the following order: "we are, therefore, of the view that the regular assessment proceeding for the years in question as also the proceeding initiated under Sec.20 (1) of the Act shall be held by the same authority and if the authority after concluding the assessment proceeding in respect of the said years is satisfied that incorrect particulars have been furnished, which Is the basis for initiation of proceedings under Section 20 (1) of the Act, he shall take further action pursuant to the impugned notice. An-nexure I, if however,he comes to the conclusion that no incorrect particulars have been furnished, he will pass an appropriate order discharging the notice. Needless to say that In respect of both proceedings, the petitioner will have an opportunity of hearing and it will be open to the petitioner to urge all contentions in defence. This is without prejudice to the contention of the petitioner that even an exemption claimed if disallowed, will not attract the imposition of penalty. It is needless to say that it is always open to the aggrieved party to challenge the order that may be passed in accordance with law before the appropriate forum. " 5. This is without prejudice to the contention of the petitioner that even an exemption claimed if disallowed, will not attract the imposition of penalty. It is needless to say that it is always open to the aggrieved party to challenge the order that may be passed in accordance with law before the appropriate forum. " 5. Thus it would be seen that now once assessment orders have been passed under the provisions of the central Sales Tax Act and under the bihar Finance Act, 1981, the remedy of the petitioner is either to file an appeal or revision under the Bihar Finance act. This writ application, therefore, falls and is dismissed. Application Dismissed.