JUDGMENT
Amareswari, J.
1. This appeal under clause 15 of the Letters Patent arises out of the order of our learned brother Raghuvir, J., in C.M.A. No. 327 of 1979.
2. The four plaintiffs filed a suit for a declaration that they are not the members of a Hindu joint family with or without one Sitaram and they were not doing any business jointly or as members of the joint family and for an injection restraining defendants 2 and 3, who are the authorities under the Sales Tax Act from “claiming” that the plaintiffs are the joint family members or that they did any business as members of the Hindu joint family.
3. M/s. Ramakrishna & Co., and M/s. Murali Krishna & Co., are two proprietory concerns. They were registered as dealers under section 12 of the Andhra Pradesh General Sales Tax Act, 1957, with Rama Rao, son of Krishna Rao and Murali Krishna, son of Krishna Rao as the sole proprietors, respectively. For the years 1971-72, 1972-73 and 1973-74 the sales tax authorities issued notices for making assessments. There was no response and during their enquiry, defendants 1 to 3 came to know that there are no persons by the names of Rama Rao and Murali Krishna and they are fictitious names and business was carried on by one Sitaram as a kartha of joint family consisting of himself and the four plaintiffs. Plaintiff No. 1 is the brother of Sitaram. Plaintiffs 2 and 4 are the sons of Sitaram and plaintiff 3 is the son of Dayaram, the deceased brother of Sitaram. The authorities thereafter issued notices to Sitaram and the four plaintiffs as to why assessment should not be made against them. Objections were submitted. Sitaram died in December, 1976. After considering the objections, assessment orders were passed holding that Sitaram and the plaintiffs constituting a Hindu joint family did business and they are liable to pay a sum of Rs. 1,85,141.34 towards sales tax.
4. At that stage, the plaintiffs filed the present suit for the reliefs that the plaintiffs are not the members of the family and they are not liable to assessment of tax and also for a permanent injunction restraining the defendants from “claiming” that the plaintiffs are the members of the Hindu joint family and they did business as such. Defendant No. 1 is the sister of plaintiffs 2 and 4. Defendants 2 and 3 are the sales tax authorities. In the plaint they averred that Sitaram was not the kartha of the Hindu undivided family and the plaintiffs did not conduct any business under the name and style of M/s. Ramakrishna & Co., and Murali Krishna & Co. The three brothers in their respective branches have not conducted any business. Therefore, the plaintiffs individually or together are not liable to pay any amount towards sales tax. Along with the plaint they filed an application for temporary injunction restraining the respondents from recovering any tax from them. The trial court dismissed the application.
5. The plaintiffs carried the matter in appeal C.M.A. No. 327 of 1979 out of which this appeal arises. Before the learned single Judge the question of maintainability of the suit carried large and on the request of the plaintiffs appellants to determine it as a preliminary issue, the learned single Judge held that the suit is not maintainable in view of section 36 of the Andhra Pradesh General Sales Tax Act. Aggrieved thereby, the plaintiffs have now come up in appeal.
6. In the first instance we thought that since the C.M.A. before the learned single Judge arose out of an order on an interlocutory application for injunction pending the suit, we thought of remanding the matter to the trial court to consider the question of maintainability of the suit. But when we went through the order under appeal, we found that it was not a prima facie finding and the learned Judge decided the issue on the request of the plaintiffs themselves. Since this is a matter involving a pure question of law and the cases have been pending from a long time, we think it is appropriate to give a quietus to this matter particularly in view of the fact that pursuant to the order of the learned single Judge holding that section 36 is a bar to the maintainability of the suit the trial court dismissed the suit.
7. The main submission of Mr. Vilas V. Afzal Purkar, the learned counsel for the appellants, is that section 36 of the Sales Tax Act is no bar for maintainability of a suit seeking a declaration of the status of the plaintiffs whether they constitute a Hindu joint family and it is not a matter which falls within the scope of the enquiry under the Sales Tax Act.
8. We first refer to section 36 of the Andhra Pradesh General Sales Tax Act which is as follows :
“36. Bar of jurisdiction of courts. – Save as otherwise expressly provided in this Act, no court shall entertain any suit, or other proceeding to set aside or modify, or question the validity of any assessment, order or decision made or passed by any officer or authority under this Act or any rules made thereunder, or in respect of any other matter falling within its or his scope.”
9. It is seen from this section that no suit can be filed to set aside not only an assessment or order, but also any decision made or passed by any officer under the Act and also in respect of any other matter falling within his scope. The Sales Tax Act is designed for levy and collection of sales tax on the turnover of business made by dealers.
10. Section 2(e) defines a “dealer” as any person who carries on the business of buying, selling, supplying or distributing goods and includes a local authority, a company, a Hindu undivided family or any society, etc. Thus a Hindu undivided family can also be a dealer and it is a taxable entity under the Sales Tax Act.
11. Section 12 deals with registration of dealers. It says that every dealer whose total turnover in any year is not less than Rs. 50,000 shall and any other dealer may get himself registered under the Act.
12. Then we come to section 14 which deals with assessment of tax. Clause (1) of section 14 empowers the authorities to levy tax on the basis of the return submitted by the dealers if it is satisfied that the return is correct and complete and if it is not so satisfied, he may pass a best judgment assessment after giving an opportunity to the dealer. Clause (2) of section 14 empowers the sales tax authorities to levy a penalty in case he has made a judgment assessment under clause (1). Clause (3) of section 14 deals with a situation where a dealer fails to submit a return before the prescribed date or produce accounts after inspection or submits a return subsequent to the date of inspection. In such a case, it is open to the sales tax authorities to make a best judgment assessment determining the tax and also levy a penalty. Clause (4) of section 14 which is relevant for our purpose is as follows :
“14(4) In any of the following events, namely, where the whole or any part of the turnover of a business of a dealer has escaped assessment to tax, or has been underassessed or assessed at a rate lower than the correct rate, or where the licence fee or registration fee has escaped levy or has been levied at a rate lower than the correct rate, the assessing authority may, after issuing a notice to the dealer, and after making such enquiry as he may consider necessary, by order, setting out the grounds thereof –
(a) determine to the best of his judgment the turnover that has escaped assessment and assess the turnover so determined;
(b) ………..
(c) ………..
(cc) ……….
(d) ………..
(e) levy the registration fee that has escaped levy;
(f) ………..
In addition to the tax assessed or fee levied under this sub-section, the assessing authority may also direct the dealer to pay a penalty as specified in sub-section (8).”
13. Under clause (4) of section 14 if the authorities are of the opinion that the turnover of a dealer has escaped assessment, they can proceed to levy tax after giving an opportunity to the dealer and making such enquiry as they deem fit. Thus in a case where a person does business without registering himself as a dealer as required under section 12, he is also liable to be assessed. The authorities can also collect registration fee under clause (e) and levy penalty. Thus while clause (3) of section 14 relates to a dealer who is liable to tax which means a registered dealer, clause (4) empowers the authorities to levy tax on the turnover of business of a person even though he does not get himself registered under section 12 as a dealer. Section 12 deals only with the necessity for registration. Supporting a person does business without registering himself as a dealer, in addition to his being prosecuted for violation of the provisions of the Sales Tax Act he can also be assessed to tax under clause (4) of section 14. Section 14 speaks of a dealer and not a registered dealer. The argument of learned counsel amounts to this, namely, that only a registered dealer can be assessed to tax and not otherwise. We are unable to accede to this contention in view of the plain language of section 14. All that section 12 emphasises is on the necessity for registration in case where the turnover is more than a particular amount. In cases less than Rs. 50,000 no registration is necessary. Therefore, registration is not the basis on which tax liability is determined. No doubt, section 14(4) requires that assessment can be made only after issuing notice to the parties. It is not the case of the petitioners that no notice was issued to the plaintiffs before making the assessment.
14. The other submission of Mr. Vilas V. Afzal Purkar is that the authorities are precluded from determining the status of the party, namely, whether he is a member of the joint family and as such it is not a matter within the province of the sales tax authorities and section 36 is, therefore, not a bar. This argument ignores the definition of a “dealer” which includes a Hindu undivided family. For the purpose of assessment the authorities will have to necessarily make an enquiry who the dealer is. A Hindu undivided family is a taxable entity as per section 2(e) of the Act. It is a part of the enquiry as to who is the dealer. The authorities will have to necessarily find out whether the dealer is an individual or a Hindu undivided family. Therefore, it is a matter which is within the province of the authorities and as such any suit in that regard is barred by section 36.
15. It may be relevant to note that the suits are filed only after the assessment proceedings are initiated. Such a suit is not maintainable as against defendants 2 and 3. Defendant No. 1 is the daughter of Sitaram and the sister of plaintiffs 2 and 4 and the suit is not held to be maintainable against her. It is open to the plaintiffs to purpose the suit as against defendant No. 1.
16. We see no merit in this letters patent appeal and it is accordingly dismissed.
C.R.P. No. 4410 of 1981 :
The civil revision petition is filed against the order dismissing the review petition filed by the plaintiffs.
17. After the judgment of the learned single Judge holding that the suit is not maintainable, the suit was dismissed. The plaintiffs filed an application to review that order on the ground that an letters patent appeal is pending. The same was dismissed, against which the present civil revision petition is filed. In view of the fact that the letters patent appeal is now disposed of holding that the suit is not maintainable, this civil revision petition has necessarily to be dismissed.
18. In the result, both the letters patent appeal and the civil revision petition are dismissed with costs.
19. It is represented that appeals are pending against the assessment orders. The appellate authority shall consider whether the view taken by the primary authority is correct or not.
20. Letter patent appeal and revision petition dismissed.