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2003 DIGILAW 419 (GUJ)

KAPILBHAI TANSUKHLAL SAMEJA v. STATE

2003-07-23

D.A.MEHTA

body2003
D. A. MEHTA, J. ( 1 ) THIS is a petition stated to have been filed under Article 226 of the Constitution of India. By this petition, the petitioners seek to challenge the order dated 24/8/2001 (Annexure-U) passed by the Collector, Rajkot and order dated 15/9/2001 (Annexure-V) passed by the State Government granting the disputed lands (stated to be of the petitioners) in favour of respondent no. 5 Hansadevi Ghanshyamsing Jadeja. ( 2 ) IT appears that the father of the petitioners purchased land bearing Survey No. 109 admeasuring 6 Acres and 9 Gunthas and land bearing Survey No. 139 admeasuring 9 Acres and 23 Gunthas situated at village Mota Mava, Taluka Dist. Rajkot. The father of the petitioners was running a sole proprietorship business in the name and style of Mahalaxmi Trading Company since 1959. The said Mahalaxmi Trading Company incurred huge losses and by 1968-69 it had run up large dues towards sales tax. Ultimately the said concern was closed down. It appears that in 1971-72, the father of the petitioners went to Madras for carrying on another business in Oil seeds/groundnut. ( 3 ) ON 21/11/1994 the aforesaid lands bearing survey nos. 109 and 139 were directed to be vested in the Government for non payment of sales tax dues by Mahalaxmi Trading Company by virtue of order of Collector, Rajkot passed under the provisions of Rule 129 (4) of the Bombay Land Revenue Rules. The petitioners and their father are stated to have returned from Madras in 1980 and upon coming to know about the aforesaid order dated 21. 11. 1974 moved an application before the Collector, Rajkot on 7. 6. 1980, followed by various applications expressing their willingness to make necessary payments and seeking regrant of the disputed land which had vested in the Government. ( 4 ) IN the meantime in pursuance of order dated 21/11/1974 necessary mutation entry bearing entry no. 228 came to be made mutating the lands in favour of the State Government. On 20. 2. 1991 the said mutation entry was challenged before the Deputy Collector, Rajkot. The appeal filed by the petitioners was rejected by Deputy Collector on 24. 4. 1991. Being aggrieved the petitioners approached the Collector on 4. 5. 1991 but the Collector rejected the appeal on 30. 11. 1992/3. 12. 1992. The petitioners preferred Revision Application on 21. 1. 1993 before the Secretary, Revenue Department. The appeal filed by the petitioners was rejected by Deputy Collector on 24. 4. 1991. Being aggrieved the petitioners approached the Collector on 4. 5. 1991 but the Collector rejected the appeal on 30. 11. 1992/3. 12. 1992. The petitioners preferred Revision Application on 21. 1. 1993 before the Secretary, Revenue Department. During the pendency of the said Revision Application the petitioners moved another application for regrant of lands on 9. 3. 1993. The Revision Application came to be rejected on 3. 7. 1993 by the Secretary, Revenue Department. ( 5 ) IT appears that on 14. 7. 1993 a public circular was issued by the office of the Commissioner of Sales Tax whereunder Amnesty Scheme came to be floated by the Sales Tax Department in relation to arrears of sales tax. It is the say of the petitioners that by letter dated 14. 7. 1993 the petitioners were also informed about this public circular and in pursuance of the same on 30. 8. 1993 the Sales Tax Department, Rajkot intimated the outstanding dues to the petitioners. The petitioners thereupon made payment of arrears of sales tax on 18. 9. 1993. It is pertinent to note that the payment was only in relation to sales tax without interest or penalty which formed the total outstanding dues. Thereafter, vide orders dated 31. 1. 1994 and 14. 2. 1994, it appears that the sales tax department specified that interest was waived by the department. On 18. 2. 1994, No Due Certificate came to be issued by the Sales Tax Officer, Rajkot. On 26. 4. 1994 the Sales Tax Department communicated to the Collector, Rajkot that as Mahalaxmi Trading Company had cleared its outstanding dues in relation to the land which was entered in the name of the State Government needful may be done. ( 6 ) THEREAFTER, it appears that there was correspondence between Collector, Rajkot on the one hand and the State on the other hand in relation to the disputed lands, viz. as to whether the same could be ordered to be regranted in favour of the petitioners. The details in relation to this correspondence shall be reverted to a little later. ( 7 ) IN the meantime, on 13. 5. 2000 respondent no. as to whether the same could be ordered to be regranted in favour of the petitioners. The details in relation to this correspondence shall be reverted to a little later. ( 7 ) IN the meantime, on 13. 5. 2000 respondent no. 5 Hansadevi Ghanshyamsinh Jadeja moved an application seeking grant of some land at Rajkot in lieu of her land situated at Jamnagar which was taken over by the State Government under the Saurashtra Land Reforms Act. The Collector, Rajkot vide communication dated 24. 8. 2001 expressed an opinion in favour of the disputed land along with other lands being granted in favour of respondent no. 5 - Hansadevi and on 15. 9. 2001 the State Government passed an order granting the disputed lands along with other lands to respondent no. 5 - Hansadevi. It is the aforesaid order dated 15. 9. 2001 and the communication dated 24. 8. 2001 from Collector, Rajkot to the State Government which are challenged in the present petition. ( 8 ) IN para 8 (A) the petitioners have made the following prayer seeking two fold relief :"8 (A) The Honourable Court may be pleased to issue a writ of mandamus or any other appropriate writ, order or direction, quashing and setting aside the communication of the Collector, Rajkot, dated the 24th August, 2001 (Annexure-U) and the order passed by the State Government dated the 15th September, 2001 (Annexure V), and be further pleased to direct the State Government and the Collector, Rajkot, to implement the order of the State Government dated the 7th October, 1997, which is at Annexure - S to the petition". Thus, it can be seen that though the petition is primarily challenging the communication of the Collector, Rajkot dated 24. 8. 2001 (Annexure-U) and the consequential order of the State Government dated 15. 9. 2001 (Annexure-V) granting lands in favour of respondent no. 5 - Hansadevi, in the later portion of the prayer clause the petitioners have sought further direction to implement the order of State Government dated 7. 10. 1997 (Annexure-S ). In light of this situation, at the time of hearing a clarification was sought from the petitioners and the learned Advocate Mr. Jal Unwala, appearing on behalf of the petitioners submitted that he is giving up the prayer for relief relating to grant of lands in favour of respondent no. 10. 1997 (Annexure-S ). In light of this situation, at the time of hearing a clarification was sought from the petitioners and the learned Advocate Mr. Jal Unwala, appearing on behalf of the petitioners submitted that he is giving up the prayer for relief relating to grant of lands in favour of respondent no. 5 Hansadevi, because in another petition bearing SCA No. 12432/01 filed by said Hansadevi, the learned Advocate for the petitioner Mr. Harin P. Raval has filed an affidavit stating that the said petitioner viz. Hansadevi (respondent no. 5 herein) gives up her claim in relation to the disputed lands viz. land bearing survey nos. 109 and 139 situated in village Mota Mava, Taluka - District Rajkot. Therefore, in effect, the present petition is now limited to seeking direction to the State Government toimplement order dated 7. 10. 1997 (Annexure-S ). ( 9 ) MR. Y. N. OZA, learned Senior Counsel appearing with Mr. Unwala on behalf of the petitioners has submitted that the State Government should be directed to return the disputed lands in light of the fact that the said lands had vested in the State Government in lieu of arrears of sales tax, which had subsequently been paid off by the petitioners, and thus the State Government had no right to retain the disputed lands. It was submitted that there was no other reason or basis which would entitle the State Government to retain the disputed lands, and in relation to the very same outstanding dues of sales tax it was not open to the State Government to recover the monies under the Amnesty Scheme and simultaneously retain the lands. Mr. Oza submitted that the case of the petitioners squarely fell within the terms of the public circular issued by the Sales Tax Department and in light of the same the petitioners had cleared the outstanding dues under the Amnesty Scheme and the Sales Tax Department had waived interest by passing specific orders in this regard. Therefore, according to Mr. Oza the stand adopted on behalf of the State Government was dishonest and the petitioners could not be deprived of their lands. That once the State Government had in principle agreed to regrant lands as per policy in Government Resolution dated 27. 9. Therefore, according to Mr. Oza the stand adopted on behalf of the State Government was dishonest and the petitioners could not be deprived of their lands. That once the State Government had in principle agreed to regrant lands as per policy in Government Resolution dated 27. 9. 1979 the course of action adopted by Collector, Rajkot in corresponding with the State Government on the one hand and not returning the lands to the petitioners on the other hand was required to be deprecated. That the Collector, Rajkot was subordinate to the State Government and was bound to implement the decision taken by the State Government. ( 10 ) MS. S. K. VISHAN, learned Advocate appearing on behalf of Mr. K. B. Trivedi, learned Addl. Advocate General contended that once the lands had vested in the State Government no legal right remained with the petitioners on the basis of which the petitioners could lay their claim to the disputed lands. It was submitted that the Amnesty Scheme of the Sales Tax Department was floated with a particular object viz. recovery of arrears and could not be utilized by a person whose arrears had already been recovered by other mode of recovery viz. attachment of the disputed land and auction thereof. That the Amnesty Scheme could not be taken recourse to for divesting the State Government of the disputed lands. It was also submitted that the petitioners should not be heard on account of delay and latches because even assuming in favour of the petitioners that there was an order made in October,1997 in favour of the petitioners, till 2001 the petitioners had not taken any steps to seek remedy, and it was only when the State Government passed the impugned order dated 15. 9. 2001 (Annexure-V) in favour of respondent no. 5 - Hansadevi that the petitioners have approached this Court. It was also submitted on behalf of the respondent State Government that in fact, there was no order of regrant and Annexure-S dated 7. 10. 1997 was only an inter departmental communication. She went on to add that even the date of the communication was disputed by the State Government and as could be seen from the affidavit-in-reply the said communication was addressed only on 9. 10. 1997 by the State Government to Collector, Rajkot and, therefore, the petitioners, by presenting the said communication as having been dated 7. 10. She went on to add that even the date of the communication was disputed by the State Government and as could be seen from the affidavit-in-reply the said communication was addressed only on 9. 10. 1997 by the State Government to Collector, Rajkot and, therefore, the petitioners, by presenting the said communication as having been dated 7. 10. 1997, had committed a fraudulent act and no relief should be directed to be granted in favour of the petitioners in the circumstances. Ms. Vishan also referred to communication dated 3. 5. 1995 issued by the Commissioner of Sales Tax and addressed to Collector, Rajkot, whereunder Commissioner of Sales Tax had in no uncertain terms specified that the subject matter of the disputed lands did not fall within the ambit of Amnesty Scheme and the lands could not be regranted to the petitioners. Lastly, it was submitted that even so called communication dated 7. 10. 1997/9. 10. 1997 was pending in review before the State Government and it was only because of the order of this Court dated 15. 4. 2002 directing maintenance of status quo that the State Government had not been able to undertake and conclude the exercise of review. In nutshell it was submitted on behalf of the respondent State Government that the petitioners were not entitled to claim regrant of the disputed lands on any ground whatsoever and the petition deserved to be rejected. ( 11 ) MR. P. J. VYAS, learned Advocate appearing on behalf of respondent nos. 6 and 7 submitted that they had been constrained to move this Court by filing Civil Application No. 3549 of 2002 to be joined as necessary parties in light of the fact that the disputed lands in question did not belong to the petitioners at all because by virtue of a sale deed dated 3. 1. 1969, the petitioners had sold the lands in favour of respondent nos. 6 and 7. It was contended by Mr. Vyas that, in the circumstances, the disputed lands could not have been attached and auctioned by the State in 1974 towards recovery of sales tax dues for the simple reason that the sales tax dues were recoverable from the petitioners and in satisfaction of such dues the property of third party viz. respondent nos. 6 and 7 could not be attached and sold. That respondent nos. respondent nos. 6 and 7 could not be attached and sold. That respondent nos. 6 and 7 have already moved the State Government in this regard by making appropriate representation. That as the said representation is not being decided, respondent nos. 6 and 7 have moved a separate petition bearing SCA No. 10452/02 which is pending. It was therefore submitted by Mr. Vyas that no relief could be granted to the petitioners by way of directing the State Government to regrant the disputed lands in favour of the petitioners, but as claimed in the independent petition, the State Government was required to be directed to return the lands to the petitioners of SCA No. 10452/02, or in the alternative, decide upon the representation which is pending before the State Government. ( 12 ) IN rejoinder Mr. Y. N. Oza on behalf of the petitioners submitted that the State Government had not reviewed its orderdated 7/9-10-1997 and even if the same was to be reviewed no notice had been issued to the petitioners, and without hearing the petitioners no such review could be undertaken. That it did not lie in mouth of the State Government to state that the public circular regarding Amnesty Scheme did not apply to the petitioners, once the Sales Tax Department having intimated the arrears, the petitioners having paid off the same and the Sales Tax Department having issued a No Due Certificate. It was submitted in this context that the total outstanding dues were Rs. 48,000/- approximately and as could be seen from the affidavit-in-reply, recovery by auctioning the disputed lands had been effected only to the extent of Rs. 18,000/- and, hence, the Sales Tax Department had correctly directed that there were outstanding dues on the date when the Amnesty Scheme came into existence. That in the circumstances, the order dated 7. 10. 1997 was effective and the State Government should be directed to regrant the disputed lands to the petitioners. ( 13 ) ON 16. 7. 2003 when the matter was heard at length the learned Advocate for the State Government was directed to place on record the Government Resolution dated 27. 9. 1979 and produce the original file containing notings for perusal of the Court. The aforesaid resolution has been duly produced on record and the file placed for perusal. They have been taken into consideration. 9. 1979 and produce the original file containing notings for perusal of the Court. The aforesaid resolution has been duly produced on record and the file placed for perusal. They have been taken into consideration. ( 14 ) THE case of the petitioners is primarily based on the fact of having made payment of sales tax under the Amnesty Scheme and, hence, according to the petitioners, the disputed lands which were attached and auctioned by the State Government should be regranted to the petitioners, because according to the petitioners, now there are no outstanding dues of sales tax which are required to be satisfied by virtue of other mode of recovery. To appreciate this contention it is necessary to decide whether the case of the petitioners falls within the Amnesty Scheme laid down in the aforesaid public circular (Annexure-L) dated 14. 7. 1993. Preamble of the circular states that it is an Amnesty Scheme (Rahat Yojana) in respect of the recovery of dues in connection with transaction of sales tax upto 31. 3. 1990. Paragraph 1 of the Scheme refers to tax leviable on a trader relating to transactions for period upto 31. 3. 1985 and such tax should be outstanding, and if such tax is paid by the trader by 30. 9. 1993, the trader will be entitled to claim exemption from payment of accrued interest as well as penalty which might be leviable. Admittedly, paragraphs 2, 3, 4, 5 and 6 of the said circular cannot be made applicable in the present case and this is agreed on behalf of the petitioners. However, reliance was placed on paragraph 7 which states that in case the trader makes payment of taxes under the Scheme coercive steps for recovery like attachment of Bank Account, moveable or immoveable properties, prosecution, auction proceedings, recovery from third parties or non issuance of c form would be automatically withdrawn by the department. That the said paragraph would also be applicable in cases of payments made through installments. ( 15 ) HOWEVER, proceeding on the assumption that the petitioners could claim benefit under the aforesaid public circular the question that yet survives is as to whether as per terms of circular the petitioners fulfill the conditions stipulated for the applicability of the circular. As seen hereinbefore, paragraph 1 of the circular specifically requires that outstanding taxes in relation to transactions upto 31. 3. As seen hereinbefore, paragraph 1 of the circular specifically requires that outstanding taxes in relation to transactions upto 31. 3. 1985 have to be paid by trader by 30. 9. 1993. Can the petitioners claim that there was any outstanding tax due on 14. 7. 1993 when the scheme came into effect. Merely because the sales tax authorities communicated a figure stated to be outstanding tax and the petitioners made payments in consequence of such communication could it be stated that there was any outstanding due of sales tax which the petitioners were required to discharge. There is no dispute as to the fact that the lands in question were attached by the Revenue Department, auctioned, sale proceeds recovered and transferred to the Sales Tax Department by book adjustment. It is nobodys case that the aforesaid exercise carried out by the Revenue Department was not in pursuance of communication of recovery by the Sales Tax Department and the entire exercise of attachment and auctioning of the lands was only a mode of recovery of outstanding dues of sales tax. The authority to carry out such exercise and the procedure adopted as prescribed under the Bombay Land Revenue Code 1879 and the Rules framed thereunder have not been disputed. The say of the petitioners is that for the very same dues there cannot be double recovery : (i) by way of attachment of the property and auction thereof; and, (ii) by way of actual payment in cash through challans. At this juncture it is necessary to bear in mind that the attachment and the auction took place some time in November,1974 while the Amnesty Scheme came to be floated for the first time only in July,1993. Thus, the outstanding dues of the Sales Tax Department stood satisfied in 1974 when the lands were attached and put to auction and the sale proceeds thereof transferred by book entry in favour of the Sales Tax Department. In effect thus there were no dues outstanding in 1993 when the Amnesty Scheme was floated by the State Government. ( 16 ) DURING hearing, when this was pointed out, Mr. Oza on behalf of the petitioners, at this juncture raised an interesting contention inviting attention to communication dated 21. 9. 1994 addressed by Collector, Rajkot to Commissioner, Sales Tax. It was submitted by Mr. Oza that even as per book adjustment only a sum of Rs. ( 16 ) DURING hearing, when this was pointed out, Mr. Oza on behalf of the petitioners, at this juncture raised an interesting contention inviting attention to communication dated 21. 9. 1994 addressed by Collector, Rajkot to Commissioner, Sales Tax. It was submitted by Mr. Oza that even as per book adjustment only a sum of Rs. 18,960/- had been recovered by the Sales Tax Department and, hence, the balance dues could be stated to be outstanding. This submission sounds attractive at first blush but does not bear scrutiny. As can be seen from communication dated 30. 8. 1993 (Annexure-M) the sales tax department has shown outstanding amount to be Rs. 47,065. 33 and in fact this is the amount paid by the petitioners by different challans. The said communication dated 30. 8. 1993 does not state that figure of Rs. 47,065/- is the balance amount due after giving credit for the amount already recovered through attachment and auction of the lands in question. In this regard, communication dated 3. 5. 1995 from the Sales Tax Commissioner to the Collector, Rajkot requires to be noted. It is stated in the said communication that in case of the petitioners the lands in questions had been auctioned long back and were duly mutated in favour of the Government. Despite that even if the petitioners have made payment of any amount as sales tax and claimed exemption in relation to interest and penalty no question would arise as regards returning of the lands which was auctioned, to the trader, because Amnesty Scheme did not have any such underlying purpose. ( 17 ) THUS, on a plain reading of the circular dated 14. 7. 1993 it is apparent that the case of the petitioners does not fall within the terms stipulated in the said circular and the petitioners could not claim to be eligible to seek benefit of the said circular. Even otherwise, once the debt had been discharged, may be partially in monetary terms, the said debt cannot be said to be subsisting after a period of nearly 19 years. It is not even the petitioners case that between 1974, when the auctionproceedings took place and in 1993, when the Amnesty Scheme was put-out, the Sales Tax Department had at any time called upon the petitioners for any outstanding dues. It is not even the petitioners case that between 1974, when the auctionproceedings took place and in 1993, when the Amnesty Scheme was put-out, the Sales Tax Department had at any time called upon the petitioners for any outstanding dues. For all intents and purposes the Sales Tax Department had effected recovery of its tax dues and the debt stood discharged. The contention on behalf of the petitioners may be tested. Could the Sales Tax Department have taken any action against the petitioners in any competent forum for so called recovery of its outstanding dues once the lands in question had been attached and auctioned, and auction proceedings credited by book entry in favour of the Sales Tax Department? The simple answer would be no. Considering the period of limitation also, assuming for the sake of argument that there were any outstanding dues in 1993, bar of limitation would come into play and Sales Tax Department could not have called upon the petitioners to discharge its debt by availing any legal remedy. In the circumstances, this contention does not merit acceptance. ( 18 ) THE petitioners having made payment of tax as can be seen from the evidence produced on record, the next question would arise whether under the Amnesty Scheme there is any stipulation of quid pro quo so as to enable the petitioners to seek return/regrant of the lands in question. Paragraph 7 of the Scheme on which reliance was placed specifically refers to proceedings of attachment, auction, prosecution etc. which are admittedly pending on the day of the Scheme. They do not refer to proceedings which have already terminated. In the present case admittedly attachment/auction proceedings culminated in the recovery of the amount by the Sales Tax Department and no proceedings for recovery could be said to be pending on the day of the scheme. Thus, even on this count the scheme cannot be said to be applicable in case of the petitioners. ( 19 ) NEXT issue that would arise is as to whether dehors this scheme the petitioners would be entitled to claim regrant of the lands. Thus, even on this count the scheme cannot be said to be applicable in case of the petitioners. ( 19 ) NEXT issue that would arise is as to whether dehors this scheme the petitioners would be entitled to claim regrant of the lands. The case of the petitioners is founded on the footing that in relation to the very same dues it is not open to the respondent State Government to attach the lands and auction the same on one hand for recovery of sales tax dues, and also collect payment under the Amnesty Scheme on the other hand. To this extent, the petitioners are right that for satisfaction of the very same dues the State Government cannot recover the amount twice over in relation to one and the same debt. However,the question that then arises is : whether the petitioners are entitled to regrant of the lands which have already been mutated in favour of the Government ? It is pertinent to note that the lands were entered in the Government head upon successful culmination of auction proceedings. The attachment and auction proceedings took place as a mode of recovery of outstanding dues of sales tax. Therefore, the debt stood discharged on the said day. The subsequent payment of tax under the Amnesty Scheme was voluntary payment and accepted as such by the State Government. It is not even the case of the petitioners that, the petitioners were called upon to make payment in satisfaction of any outstanding dues, communication dated 30. 8. 1993 (Annexure-M) notwithstanding. Therefore, if at all, there has been a double payment in relation to one and the same debt, it is at the behest of the petitioners themselves. The petitioners knew very well that the debt had been discharged when their lands had been attached and auctioned in 1974. The petitioners do not deny this knowledge. If that be so, the petitioners cannot thereafter claim that because the petitioners made voluntary payment in 1993 the lands must be returned to the petitioners by the State Government. At the best, the petitioners may be entitled to seek refund of the amount paid in 1993 of their own volition, because the State Government cannot retain funds twice over in satisfaction of one and the same debt. Hence, the contention regarding double payment and return of lands on the said basis does not merit acceptance. At the best, the petitioners may be entitled to seek refund of the amount paid in 1993 of their own volition, because the State Government cannot retain funds twice over in satisfaction of one and the same debt. Hence, the contention regarding double payment and return of lands on the said basis does not merit acceptance. ( 20 ) IN this connection, it is necessary to take note of the fact that entry no. 228 whereunder the lands came to be mutated in favour of the State Government were challenged in 1991 before the Deputy Collector, Rajkot. On 24. 4. 1991 the said appeal was dismissed by Deputy Collector, Rajkot and being aggrieved the petitioners approached the Collector, Rajkot on 4. 5. 1991. On 30. 11. 1992/3. 12. 1992 the Collector dismissed the appeal and subsequent revision filed before the Secretary, Revenue Department on 21. 1. 1993 came to be rejected on 3. 7. 1993. It is also pertinent to note that in the meantime the petitioners had moved Collector, Rajkot by various applications right from 7. 6. 1980 to regrant the lands. These applications sought regrant of lands after showing willingness to make necessary payments in this regard - not tax. Thus, till 3. 7. 1993 when the Revision Application came to be rejected by the Secretary, Revenue Department, there was no occasion for the petitioners to make claim of regrant of lands on the basis of double payment having been effected for the outstanding sales tax dues. It was a fortituous circumstance that on 14. 7. 1993 the public circular floating Amnesty Scheme came to be issued by the State Government and the petitioners seized upon the opportunity. As already stated hereinbefore the claim on the basis of payment made under the Amnesty Scheme cannot carry the case of the petitioners any further. .