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The Commissioner Of Commercial … vs Agrawal Medical & General Store on 21 March, 2003

Madhya Pradesh High Court
The Commissioner Of Commercial … vs Agrawal Medical & General Store on 21 March, 2003
Equivalent citations: 2003 (3) MPHT 142, 2004 137 STC 333 MP
Author: D Misra
Bench: D Misra, S Pande


ORDER

Dipak Misra, J.

1. This is a reference under Section 44 (1) of the M.P. General Sales Tax Act, 1958 (for brevity ‘the Act’) by the Board of Revenue to this Court for answering the question which reads as under:–

“Whether in the facts and circumstances of the case the Board of Revenue was justified in taking the view that the limitation of 30 days for the application under Section 45-A of the M.P. General Sales Tax Act, 1958 should have commenced from 4-12-1981 when the ex parte order was communicated to the assessee dealer, and not from 27-7-1981, i.e., the date on which the case was closed by the Assistant Sales Tax Officer for ex parte order ?”

2. The facts, as are discernible from the order passed by the Board of Revenue are that the assessee-dealer was assessed to Sales Tax for the period 11-11-1977 to 31-10-1978 by the Assistant Sales Tax Officer, Narsinghpur, Circle-1. In the order of assessment it has been recorded that the dealer was served with notice to appear before the Assessing Authority on ten occasions between 9-5-1979 to 14-7-1981. In the last notice dated 14-7-1981 the next date of hearing was indicated as 27-7-1981. As the assessee chose not to appear, on 13-8-1981 the Assessing Officer recorded about his absence and passed the ex parte order. It is relevant to state here that on the earlier occasion, the Assessing Officer had also recorded that the assessee had not remained present and there was no prayer for adjournment and in that backdrop he had directed for passing of the ex parte order.

3. As is perceivable, the ex parte order was communicated to the dealer on 5-11-1981 in which he was asked to deposit Rs. 4,165/- on account of tax penalty. The dealer filed an application under Section 45-A of the Act on 4-12-1981. Originally the Assessing Authority by order dated 5-12-1981 had set aside the order dated 13-8-1981 because he had found that the total sales of the dealer, during the period under assessment was relating to tax paid goods and, therefore, he had not incurred any tax liability. The order of the Assessing Officer was taken up in review by the Additional Commissioner of Sales Tax, Jabalpur, under Section 39 (2) of the Act. A notice was issued to the dealer-assessee that his application under Section 45-A of the Act had been filed after the prescribed period of 30 days from the last date of hearing, i.e., 27-7-1981. It had not been mentioned when the notice had been received by him and, therefore, period of limitation in that case would run from the date of intimation regarding the ex parte order. The Additional Commissioner by order dated 4-1-1985 rejected the plea taken in the application because according to him the order-sheet graphically made it clear about the fixation of the date of hearing, i.e., 12-8-1981. That apart, the case had already been closed for ex parte order on 27-7-1981.

4. Being aggrieved by the order passed by the Additional Commissioner the assessee preferred an application under Section 39 (3) of the Act before the Board of Revenue. The Board of Revenue expressed the view that as no ex parte order was passed or came into being on 27-7-1981 the limitation for filing an application for setting aside the ex parte order would commence from 5-11-1981 and hence, the Assessing Authority was justified in entertaining the application and disposing of the same on merits. After the disposal of the matter by the Board of Revenue the Department filed an application for making a reference to this Court on ground that there was no basis for the view taken by the Board of Revenue as the ex parte order was not passed on 27-7-1981 and the limitation would run from the date when the order was passed on 12-8-1981, which was communicated to the dealer. It was contended by the learned counsel for the Department that it was not obligatory to pass an order on the date the case was closed for ex parte order. It was also urged that the Legislature intended that the limitation would run from the date of ex parte order. It was putforth before the Board of Revenue that the language used in the statute ‘the date of hearing’ and not “the date of ex parte order”, therefore, a literal meaning has to be given to the same and any kind of interpretation was not permissible, the language being clear and unambiguous.

5. The aforesaid stand of the Board of Revenue was combatted on the backdrop that it would not be correct to assume that 27-7-1981 was the last date of hearing because the order- sheet of 13-8-1981 again mentioned that no one was present and no application had been received. It was setforth that if the case was really closed the Assessing Authority would have straightway passed an ex parte order. The Board of Revenue did not accept that the last date of hearing was 13-8-1981 and not 27-7-1981. However, the Board of Revenue was also to the view that the assessee was not liable to pay tax as he was dealing with the tax paid goods. Though such an opinion was expressed in the facts and circumstances of the case which has its own peculiarity. Yet the Board of Revenue framed the aforesaid question, as it was urged by the Revenue that by such an order a precedent would be established and there would be cases which would cause loss of revenue to the State and that is how, the reference has been made to this Court.

6. Despite of service of notice there has been no appearance on behalf of the assessee. Ordinarily we would have directed for filing of fresh requisites, but as the Board of Revenue has observed in the most unequivocal and categorical manner that the assessee was not liable to pay any tax because of its dealing with the tax paid goods, we do not think it necessitous to issue any further notice to him.

7. Mr. Hemant Shrivastava, learned Government Advocate for the State also does not dispute the aforesaid legal position. Thus, we proceed to answer the reference inasmuch as there may some cases which might be pending under the old Act, namely, M.P. Genera! Sales Tax Act, 1958 and the dealer may not be dealing with the tax paid goods. In this scenario we think it condign to reproduce Section 45-A of the Act. It reads as under :–

“45-A. Power to set aside an ex parte order.– In any case in which an order of assessment is passed ex parte, the dealer may,–

 (a)      if he had previous intimation of the date of hearing, within thirty days of the date of hearing; and  
 

 (b)      if the dealer had no previous intimation of the date of hearing, within thirty days from the date of service of such order,   
 

 apply to the assessing authority to set aside the order and reopen the case and if such authority is satisfied that the applicant did not receive notice or was prevented by sufficient cause from appearing on the date fixed, it may set aside the order and reopen the case for hearing :  
 

 Provided that no application for setting aside an ex parte assessment order shall be entertained unless it is accompanied by satisfactory proof of the payment of the amount of tax admitted by the order:  
 

 Provided further that such an application shall be entertained only once in the course of any proceeding."   
 

8. Submission of Mr. Shrivastava is that the date of hearing is the crucial and as it finds mention in Section 15-A (a) and in the case at hand the date of hearing was fixed on 27-7-1981 and prior to that the assessee had due intimation with regard to the date of hearing. We need not to delve deep into the obtaining factual matrix of the present case. The real hub of the matter is whether if an assessee had previous intimation of the date of hearing whether the limitation would be computed from the date of hearing itself or from the date of passing of the ex parte order. We may at this juncture state that as far as Section 45-A (b) is concerned, there is no difficulty or remora to confer the meaning of Clause (b) that 30 days limitation would commence from the date of service of the order passed ex parte. The said clause would be attracted if the dealer had no previous intimation. The problem arises in relation to 45-A (a) inasmuch as the term used is ‘within 30 days of the date of hearing’. The whole provision has to be read in a purposive manner and appreciated in the given context. It is well settled in law that a provision has to be read keeping in view the text and the context.

9. In this context we may profitably refer to the decision rendered in the case of Santasingh v. State of Punjab, AIR 1976 SC 2386, wherein the Apex Court ruled thus :–

“The words of a statute, when there is doubt about their meaning, are to be understood in the sense in which they best harmonise with the subject of the enactment and the object which the Legislature has in view. Their meaning is found not so much in a strict grammatical or etymological propriety of language, nor even in its popular use, as in the subject or in the occasion on which they are used, and the object to be attained.”

10 It has been said long back that the Courts are not bound to be guided by the literal interpretation when it frustrates the quintenssential purpose of the statutory provision.

11. In the case of Vanguard Fire & Gen. Ins. Co. v. Fraser & Ross, AIR 1960 SC 971, it has been held as under :–

“The Court has not only to look at the words but also at the context, the collocation and the object of such words and interpret the meaning intended to be conveyed by the use of the words under the circumstances.”

12. In this context, we may profitably refer to the decision rendered in the case of New India Sugar Mills Ltd. v. Commissioner of Sales Tax, Bihar, AIR 1963 SC 1207, wherein Their Lordships held that while interpreting a statute the Court cannot ignore its aim and object.

13. In the case of N.K. Jain v. C.K. Shah, AIR 1991 SC 1289, the Apex Court referred to the decision rendered in the case of Seaford Court Estates Ltd. v. Asher, (1949) 2 All ER 155, wherein Lord Denning, L.J., observed as under :–

“The English language is not an instrument of mathematical precision. Our literature would be much poorer if it were. This is where the draftsmen of Acts of Parliament have often been unfairly criticised. A Judge, believing himself to be fettered by the supposed rule that he must look to the language and nothing else, laments that the draftsmen have not provided for this or that, or have been guilty of some or other ambiguity. It would certainly, save the Judges trouble if the Acts of Parliament were drafted with divine prescience and perfect clarity. In the absence of it, when a defect, appears, a Judge cannot simply fold his hands and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament, and he must do this not only from the language of the statute, but also from a consideration of the social conditions which gave rise to it and of the mischief which it was passed to remedy, and then he must supplemented the written word so as to give ‘force and life’ to the intention of Legislature. A Judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out ? He must then do so as they would have done. A Judge must not later the material of which the Act is woven, but he can and should iron out the creases.”

In the aforesaid case, Their Lordships held that the propose of the Legislation is allowed to be achieved and a purposive approach is necessary.

14. In the case of Busching Schmitz Private Limited v. P.T. Men-ghani, AIR 1977 SC 1569, the Apex Court had laid emphasis on the principle that the Courts should adopt object oriented approach keeping in mind the principle that the Legislative futility is to be ruled out so long as interpretative possibility permits. It has also been settled that there should be object oriented approach but in the said conception it can not be carried to cause violation to the plain language of the statute. The scheme of the Act and the occasion are to be kept in view.

15. We may hasten to state that if the text is made alien to the context or the context is bereft of the text then there would be an anamoly. The heading of the provision opens with the words “to set aside the ex parte order”. Thereafter the words used are “in any case in which an order of assessment is passed ex parte”. Thus, the power is to set aside the exparte order. The language used in the section itself is in consonance with the heading of the provision. To elaborate the section opens with the words in any case in which an order of assessment is passed ex parte. After Sub-sections (a) and (b) the provision stipulates that the assessee may apply to the assessing authority to set aside the order and reopen the case. Thus, the purpose is to set aside the ex parte order and get the proceedings reopened. Unless an ex parte order has been passed the question to set it aside does not arise and the question of reopening of the same also does not crop up. Thus, in our considered opinion, passing of ex parte order is the substratum of Section 45-A. The words “within 30 days of the date of hearing” occurring in Clause (a) actually means the date of the order and the order means ex parte order. Unless such a meaning is given to the aforesaid words an absurd situation would arise up and law does not countenance any kind of absurd situation. It is well settled in law when a provision is literally interpreted and by interpretation it leads to any kind of absurdity it has to be avoided. To give proper meaning and purposive logical interpretation to Section 45-A one has to abandon the concept of literal construction in regard to the term ‘date of hearing’ and has to construe it as the date of order. That makes the provision sanguine, purposive, logical and workable.

16. In view of the aforesaid analysis we answer the reference by stating that limitation of 30 days for an application under Section 45-A (a) of the M.P. General Sales Tax Act, 1958 would commence from 13-8-1981 on the date which the ex parte order was passed and not from 27-7-1981 when the case was set out for ex parte order. To put it succintly the provision enshrined under Section 45-A (a) would convey the meaning that the computation of limitation has to commence from the date of passing of the ex parte order and not from the date of hearing.

17. Resultantly, the reference is answered in favour of the assessee and against the revenue.

18. The M.C.C. is accordingly disposed of.

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